We take it for granted, the seemingly endless barrage of buy orders taking the markets to new highs, compressing volatility and reducing it to a story to be woven near the fireside to the grandkids.
“Back in my days, we’d deal with this instrument called volatility. One day it really went up. Boy you had to be there.”
“Grandpa, what’s volatility?”
What is taking place in the markets is nothing short of extraordinary. The markets go up, constantly, for years and everyone doubts them. God bless the souls of Tim Knight and Zerohedge. I have no idea how they can remain on the interwebs after being treated so brambly by the markets.
Now based upon historical precedence, which doesn’t seem to mean anything these days, a $13 handle on volatility should mean we are near the highs, if not the high of the markets, and something is going to surprise us in such a way– we will regret the day our fathers decided to do without a contraceptive. Theoretically, markets are about to plunge and all of you stupid readers out there will wallow, like fat men in kiddie pools, stuck in egregious losses.
“The Fly” is immune to such occurrences, since he would be in outerspace, enjoying the view, while firing his Orbital Space Cannon (OSC) at the indigenous folks in Africa. There is nothing redeeming, whatsoever, about that God forsaken continent.
But you know it’s all poppycock. The markets will crumble no more than a person inside of the lower class will live life without bitterness, contempt and honour.
Inverse volatility has been all the rage, with XIV being the number one performer in the ETF/ETN world last year. I see no reason to believe it will stop edging higher. After all, NOTHING seems to be able to derail the markets.