Risk Happens Fast in the Market’s Sea
“The sea was angry that day, my friends – like an old man trying to send back soup in a deli.”
– George Costanza
Today’s market is different than some of the past sharp drawdowns in the last 12-18 months.
* The drop is broad and deep — with other asset classes like gold and bitcoin joining the downside.
* There is no single catalyst like Leopold (Situational Awareness hedge fund liquidation) to blame on the market’s selloff.
* The weakness in financials over the last several months is now accelerating, with no respite whatsever.
* The decline in over stretched stocks is breathtaking — especially the over conceptualized AI stocks on the periphery (e.g. $GEV -$105 to $820). Look at the breakdown in $CAT’s chart (-$45 and down from $950 to $695 in a straight line).
* We are witnessing a classical (but violent) rotation. See the remarkable strength in staples and healthcare.
* A sign of flight to quality/safety seen in a pronounced rise in bond prices (and in lower bond yields). ($TLT +$1.20 today)
Position: None
