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Disconnects And The Fed’s Ever-Present Reflexivity Problem
As discussed at some length in "Who You Gonna Believe?," one of the key market themes headed into September was the notion that benchmark equities were disconnected from rates, FX, commodities and even from their own internals in terms of pricing a US slowdown which, notwithstanding constructive reads on consumer spending and the services sector, is plain enough to see.
Opinions vary on the scope and severity of that slowdown, and indeed some observers claim they can't see it at all. I can see
Thanks H. Thought-provoking and important to keep in mind for long- and short-term investors/traders. When the vol lever spins again, reflexivity will help explain why there’s no crash-up again. No bailout this time unless we’re getting nuked, in which case it won’t do much good.
I’m surprised no one commented on this article.