This fallout could happen quicker than 2008’s

by Alex

Reason: More people know how to hedge the crisis/downturn. eg buy puts, vix, shorts. I believe some hedge funds probably hedges with repo funds that borrows from fed. liquidity is double edge sword now.

bubble everywhere, not just stocks. fed cant handle all the crisis with less ammo than 08. for one thing, market already expected 0% interest rate, so cutting rates all priced in

China and entire Asia is down to recession and already spread to other area. its global recession, market is pricing it now. thus I think more pain will come incoming weeks.

10yr yield and all short term yields in collapse in speed never seen before. it indicate money are flooding into bonds from equities.

this virus crisis cant be fixed by monetary policies, even fiscal. you cant help if consumer dont come out to spend. ppl will lose jobs. effect will last 2 quarters at least and only start recovery in the 3rd or 4 quarter. so its typical recession as previous one in term of duration and we are in the everything bubble, anything unexpected could happen in this recession.

investors have front run fed and other indicators for years, and they will priced in everything that potentially will happen, like rates, recession and even crash. if recession in next 12 months, market price will priced in that in weeks. this is why this plunge will happen quicker, and deadlier as time goes. so far, not panicking yet, so keep your puts. ppl are just too greedy, I think they are the most greedy sentiment in the human history, thx to fed. fed helped to create such bad investing environment.

I expect vix will break previous record of 80 and will top off in early 2021. just my imo. so long vix. you can still short small-mid caps, by use tza, but the swings in the market will give you heart attack.

just my 2cent

Sorry, English is not my first language.

Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.


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