It wasn’t supposed to be this way, but it is. We have a bonafide rout on our hands and we cannot stop the selling. The SOX is down 6% for the session, NASDAQ down 2.3% and the Russell down 3.4%. The regional bank index is off by 4.5% and the volatility index is up a rather genteel 11%.
The impetus is multi faceted, but mostly fears of war with Iran, Kamala up in polls and a general disdain for stocks and people forced to liquidate due to margin calls.
Margin debt in the US stands at $809b, +15% from last year.
I’ve been patient with trying to give this market a chance to bounce but the selling has been relentless, unending momentum sharply to the downside. It would BEHOOVE you to believe this is a one off event and how the US 10yr plunging below 4% is a good sign. In fact, secular and consumer staples and utilities are strong, alongside treasuries, in a classic risk off tape. Do not misconstrue the old bull market for this new bear, as it’s claws scratch away at your face cleaving out your eyeballs leaving you to toil about the market without your senses, off balance and staggering towards a cliff.
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“The Bull Never Left”
You change your mind more often than my wife.