Marko Kolanovic: ‘Over The Past Month, Confidence Virtually Collapsed’
“Instead, already fragile sentiment was undermined”…
“Instead, already fragile sentiment was undermined”…
A truly incisive critique from the Street’s most celebrated analyst.
Searching for the elusive “pot of gold.”
“This view has a simple logical mistake”…
Light at the end of the tunnel?
“We still think that the market will move higher into the year-end, and investors may have to participate on the upside.”
“…there is an elevated risk of market reversion into year-end.”
“Many macro fundamental narratives were presented to explain the price action the past week, but”…
“This risk is now balanced, and can turn into a positive impact”.
“…the equity market likely implies that the Fed is underestimating various risks.”
“…the question arises whether the rest of the world should diversify away from the risks of the USD and USD-centric finance.”
Reading the tea leaves.
“The main risk to our pro-cyclical and non-US tilt is a spiraling escalation of the trade war, political tail risks in Washington, and failure of the Fed to recognize those potential developments.”
Kolanovic’s latest is, as ever, well worth reading. But it should be viewed in context.
“The recent divergence in the performance of US Equities vs. the rest of the world is unprecedented in history.”
“Regardless of whether this materializes, our view is that a slower pace of hiking is the right thing to do.”
“…re-risking is likely to continue during the summer as volatility stays contained and investors increase equity positions.”
You know what? I’m not sure you people are emotionally stable enough to be trusted with Marko Kolanovic notes anymore.
“Liquidity was a big problem in the market meltdown of early February, and hasn’t really recovered since then.”
Marko Kolanovic – a.k.a. “Gandalf”, a.k.a. the “half-man, half-God” – has a new note out and it’s great.
“Narrative of recent selloff: imminent concerns about inflation, rates, trade wars, and a growth downshift are overblown, in our view.”
Gandalf. Need more Gandalf.
And when “presented” with that opportunity in an environment where trading revenues are drying up, you can bet the whales and squids are going to come knocking demanding their “fair” share of the action.
Super bullish with (more than) a hint of tail risk.
The thing about wizards is they are “never late, nor are they early.” Rather, “they arrive precisely when they mean to.”
And what does Kolanovic think the next crisis will look like? Well, “the next crisis’s main feature will be severe liquidity disruptions resulting from market developments since the last crisis,” he says.
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