🚨FROM THE MOST EUPHORIC MARKET IN HISTORY TO A COMPLETE BLOODBATH IN 2 HOURS🚨
US stocks, Gold and Bitcoin massacred after the Fed cut rates by 0.25% and expect fewer cuts in 2025 and 2026 due to inflation concerns. VIX and US dollar spiked. Performance yesterday: S&P 500 -3.0% - biggest drop since March 2020 CRASH Nasdaq -3.6% Russell 2000 -4.7% Dow Jones -2.6% Bitcoin -5.5% Bank Index -4.2% VIX +54% front mth futures VIX +17% Gold -2.2% Silver -3.3% WTI Crude Oil -0.9% Source: Bloomberg, Global Markets Investor
US BANKS UNDER PRESSURE
With Powell stating that there won’t be significant rate cuts next year and the yield curve un- inverting along with BTFP going away banks were hammered yesterday as most of them have BILLIONS worth of unrealized LOSSES in BONDS. Source: The Coastal Journal
Powell is second to none when it comes to market reaction on Fed day.
He lived up to his reputation and track record yesterday. To say the least... Source: Bespoke
‼️AHEAD OF THE FED MEETING YESTERDAY, INSTITUTIONAL INVESTORS WERE ALL-IN ON US STOCKS AND CASH ALLOCATION AT RECORD LOW ‼️
Institutional investors* cash allocation hit the lowest level ON RECORD. This comes as allocation to US equities hit a RECORD HIGH. What will happen when stocks begin to drop? *171 Fund Managers with $450 billion in assets Source: BofA, Global Markets Investor
BREAKING - Trump tells NBC he'd support abolishing the debt ceiling, calling it 'the smartest thing Congress could do' and suggesting it's more psychological than practical.
President-elect Donald Trump expressed support for abolishing the debt ceiling, calling it a "meaningless concept" that Congress should eliminate entirely. Speaking to NBC News, Trump suggested that removing the debt ceiling would be the "smartest thing" lawmakers could do and offered to lead the charge if Democrats pursue it. He also criticized a recent funding deal reached by Congress, labeling it a "Democrat trap" and questioning House Speaker Mike Johnson’s leadership. Trump suggested a potential government shutdown could help set the stage for his administration, and revealed he had discussed the funding deal with Elon Musk, aligning their views on cost-related issues. Source GNF - Global News First
Bitcoin is still tracking global M2 with a ~70-day lag.
Two scenarios: dislocate from global M2 thanks to BTC-native buy side, or continue following it into a deep mid-cycle correction. Source: Joe Consorti, Bloomberg
The economic weakness in Germany is becoming chronic.
The Ifo Business Index fell to 84.7 in December, down from 85.6 in November –its lowest level since May 2020. This is far below the long-term average of 96.6 and looks weak even compared to recent years. Since the start of the war in Ukraine, the index has averaged just 88.2. The latest drop was driven by a sharp decline in the expectations component, which fell from 87 in November to 84.4 in Dec. Analysts polled by Bloomberg had predicted a slight uptick and none saw a retreat of that scale. Source: Bloomberg, HolgerZ
"Cash is trash"
Fund Manager cash allocations at a record low... Source: Callum Thomas, BofA
