We have ourselves a fucking rout underway, with the NASDAQ off by more than 500. If you’re wondering what the news is: here it is: Pax Americana is over.
What is the premium attached to being the dominant super power in the world?
But today isn’t about stocks, per se — but the calamity occurring in the crypto markets. In fairness to the mood, often times bottoms are placed during times like this. Just when you think the world is going to explode — BAM we melt up. The only problem with that narrative is the FUCKING FED MIGHT HIKE RATES BY 100BPS ON WEDNESDAY!
The US 10yr is +16bps to 3.36%. The cost of servicing debt is exploding and this has spilled into both the MBS and CMBS markets. I have no way of being able to predict what tomorrow might bring. I can only tell you from experience that when shit like this happens — unemployment is around the bend and lower stock prices are all but a foregone conclusion. This issue we are facing isn’t transient. The inflation monster might be tamed — but by the time it is — the economy will be in such disrepair it’ll take Fed rigging to get us back to normal again. And then we might undergo yet another round of inflation and this cycle will repeat itself for years to come.
My trading is FLAT for the session, now holding 10% positions in FAZ and TZA, the rest cash.
Happy trading!
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