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JPMorgan Identifies ‘Point Of No Return’ For Stocks After Selloff ‘Dress Rehearsal’
When should you throw in the towel on the equity rally? Not on August 5, as it turns out, hindsight being 20/20 and such.
The Sahm rule trigger was a false alarm (just ask Claudia) and the vol shock was a dealer stop-in (a convexity event from legacy short VIX call positions). In other words: The growth scare and the appearance of a market panic were a bit of a Fata Morgana. Hence the quick fade.
As Nomura's Charlie McElligott put it, describing the turnaround in equities and accompanying vol
If there’s a wile e moment and stocks go down they will prob go down more. Get those two a bonus.
Respect on the Redd Foxx reference. They don’t make ‘em like that anymore.