Following what may have been the most drama-filled weekend since “Lehman Sunday”, in which we saw not only another major spike in covid cases around Europe and the US, but also the total collapse of OPEC after Saudi Arabia unilaterally decided to flood the market with deeply discounted oil in a desperate attempt to crush the competition (yet which may backfire and soon lead to riots in Riyadh), markets are reacting appropriately and just like during Lehman Sunday, everything is crashing:
- S&P emini futures are down more than 4% in early trading, plunging as low as 2,845 and fast approaching their limit down price of 2,819 as investors around the world puke risk in an unprecedented fashion.
- Dow futures are down more than 1,000 points unwinding all of Friday’s remarkable late-day rally and then some…
- VIX futures are up 16%, so one can only imagine where spot will be soon.
- With everyone rushing into safety, rates are soaring and the Ultra bond future is already up a gargantuan 7 to 232-16 in a squeeze that will surely lead to the failure of more than one macro fund still short the long-end, while the 10Y yield is on pace to hit a record all time low of 0.50%, one which screams recession.
- Naturally, the oil complex is imploding, with WTI down 27% to $30…
- … while Brent has dropped as much as 31%, to just $33 in early Sunday trading in what Bloomberg dubbed “one of the most dramatic bouts of selling ever”…
… and indeed, today’s move is the biggest one-day drop in Brent on record.
… in line with Goldman’s shocking price target cut, which now expected Brent dropping into the $20s.
FX, as discussed earlier, is in freefall, with carry trades getting unwound, while commodity pairs are getting anihilated:
- NORWEGIAN KRONE FALLS TO LOWEST SINCE AT LEAST 1985 VS DOLLAR
- FALLS EXTEND IN CANADIAN DOLLAR, NORWEGIAN KRONE, MEXICAN PESO
Finally, gold, also known to certain WSJ “experts” as a pet rock, it just spiked above $1,700 for the first time since 2012.
What happens now? Well, earlier today Morgan Stanley said that to stabilize markets, the Fed would need to announce not only a rate cut but also resume official QE…
We believe equity markets will struggle until policy-makers get back ahead of the curve with more interest rate cuts and an extension of the current balance sheet expansion and/or an official quantitative easing program – something we think is likely coming
… and with spot VIX likely set to trip 60 or more, the Fed will need to do something or risk another Great Depression, although how sending nominal bond yields into negative territory across the board will help markets remains to be seen. Maybe the Fed’s time has finally run out?
Or maybe Trump – who provoked the market gods one too many times with his relentless stock market boasts as stocks hit artificial high after artificial high – actually has something up his sleeve, because moments after futures opened, he tweeted a rather cryptic “nothing can stop what’s coming.”
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They will lower the pump price by .01cents.
And that will take three weeks to accomplish.
Yes . . . it only RISES in four seconds.
One of the very few things w Bush said that I agree with: This sucker is going down.
Great! I’ll be able to save money on gas and use those extra funds to buy toilet paper, hand sanitizer, and bleach. What’s that you say? You’re telling me that all those products are already unavailable. Evil hoarders!!! It’s not fair!!! Reeeeeeeee!
“We will not let him divide us. . . “
Go to your local pool store and buy chlorine tabs. They can last years (bleach wont last 18 months) and one 5 gallon $125 bucket will clean 1m gallons of water for dri king
Went to grocery for 1 thing at 3pm-larger than average crowd. Only tp was a little of the cheap stuff-all the quality brands were gone. There was lots of paper towel product. Walked over to the feminine hygiene aisle, expecting empty shelves-wrong-it hardly looked like any of that stuff had found a home.
As if New York isnt gonna have enough problems with coronavirus, now theres going to be fund managers and bankers falling onto sidewalks. Just shut it down and spare us.
You know what they tell bankers? It’s not the fall that gets you it’s the sudden deceleration
Weren’t we all awaiting this rout? For a long time? If this is even it.
Frankly I’m almost giddy with excitement just because after about 10 years of getting eye rolls from my wife for predicting a breakdown of the system, I can finally say “See, I told you so!”
This ain’t it, this is the back the truck up time.
Well almost, the carnage will continue to depress for the next week or two, at least until the next sizable rate cut.
And shortly after that…a cure or a vaccine or whatever will be announced…and massive, massive amounts of liquidity will flood into every nook and cranny.
Historic buying, historic refinancing, historic liquidity.
Did I mention it will be historic?
And then…
After the orgy of liquidity generation, Trump is going to announce the biggest middle class tax cuts in history, mid to late summer, turbo charging the historic liquidity consumption event.
After all that spending, nobody is going to remember Corona.
People will be happy, well, not all, some are going to jail, some will check out, some will flee, but everybody you know will be happy and will be happy people are going to jail.
Trump will get reelected in a historic landslide after putting a historic amount of beareacrats in jail.
Did I mention it will be historic?
It will be.
You forgot to mention the 30 trillion in national debt that will collapse the dollar
Easy now, I did not forget, that is for after the election and the End of the Fef.
Even a blind squirrel finds a nut once in awhile.
Me too!
It was never a question of if, only a question of when.
It’s looking more likely with each passing day
H*ly shit
Not Holy at all.
True . . . this time it was v*dka, assh*le
🙂
Actually, White Russian but whose counting
This is intriguing.
I remember about three or four years ago there was discussion that Putin had ordered all government/bureaucratic messages to be typed on typewriters and passed around eyes-only and hardcopy.
People rolled their eyes. They rolled their eyes when I came here with a UHAUL full of furniture padded with toilet paper too.
J.C. is going to try to explain the 5G impact. I’m putting some good use to all those years Uncle Sam paid for me to go to the journalism school. My son thinks I got this one right.
How about those Tulips, by the way?
My God girl, why don’t you just blow JC and let him fuck you up the ass. His video was very informative, but for the love of JC……
MG is back on the sauce.
Don’t mess with Vlad He wrestles grizzlies you know
Ultimate Game Theory?
Putin is a Putz.
March 11th = 35 years since Gorby was installed
The Cold War was just a yard sale and “Russia” is USSR 2.0
Russia always was a customer. It was never a threat.
Free fall ain’t bad it’s the sudden stop .
Jump you fuckers ….
Jaime Dimon supposedly out with emergency heart surgery last week; what are the odds he’s faking it?
I would have never suspected the guy even had a heart.
https://nypost.com/2020/03/05/jpmorgan-ceo-jamie-dimon-had-emergency-heart-surgery-memo-says/
Didn’t the little Dimon fella also have throat cancer? What was going on then?
Too much oral sex with hookers
“All manner of disease and affliction.”
Always the contrarian, I think they’ll get a grip on it for now. They aren’t ready to pop it just yet but they would love to get control of the gun owning half of the country first. For that they need warmer weather. The rioters never burn their houses down before the last frost. If they can scare people into accepting medical martial law (Quarantine) they’ll have smoother sailing.
If the Fed starts buying huge blocks of stocks and bonds with more fiat and throws some helicopter money to the crowds that will mean they don’t want it popping just yet. While everyone was watching as the impeachment turns and days of our virus, the smart money was easing out of the markets and into pm’s while the pensions and 401 type funds were moved into junk bonds and other losers. The Russian and Saudi attack on shale will kill pensioners not the 1% or the NWO.
Corona virus is the perfect opportunity for a meltdown to get rid of the excess. Actually, just to take the profits and fuck the little guy by telling him he’s in debt with the national debt they piled up saving these too big to fail 1% fuckers.
EC.
And the little guy hasn’t been told yet that he is the one on the hook for all those fake dollars outstanding. At least he hasn’t been told in plain language.
Oh, they were also responsible for the run-up in bubblicious prices?
Astounding.
Who said that? You presume a lot.
So they could kill pensioners [financially] no matter what, i.e. doesn’t matter how stock/bond/resource/RE prices moved over the past years?
This Putin guy is really omnipotent…
I didn’t say or imply any of that. I said the pension money is going to get clobbered in the process of all this chaos. Are you so stupid that you thought I said they targeted the pensioners who are just chump change in the scheme of things or are you just being an asshole.
And you still haven’t even touched on the Fed’s role in setting the route and paving the way for this coming disaster.
Instead you recite stereotyped propaganda, and now are playing the victim card plus accuse others of acting stupid.
I wasn’t writing a book asshole. You want to write about the fed go for it. You just dropped an insult out of the blue and then get your panties bunched when I throw shit back over the fence. I haven’t told anyone to piss off today.
Piss Off.
Keep sidestepping the issue that you deliberately mispointed to who is really responsible for pensioners soon getting financially killed.
And if you cannot write it concise without completely falsifying your argumentation, better drink a big cup of STFU.
By the way I tried it with sarcasm first, but seems you are impervious to finer tones.
Once again asshat. Piss off. You want to point out who you think is responsible and why in the reply column go for it. I made a simple easily understood statement and you decided to drop an insult because you can’t tell the difference between a simple comment and a Thesaurus.
In more apropriate articles here I have gone into great detail about who is responsible and why. I may do so again sometime but not because a squirrely dikwad like you can’t pay attention.
Look, the Paul Krugman defense: “But I wrote exactly that, in a half-sentence in one of my 1000 articles over the last 5 years!”
You made an easy-to-understand virtue-signalling statement against the default-propaganda villain, that Putin-Hiter guy. And then you react piqued when I call you out on it.
I think you only have one option left now, namely to call me a Russian Asset (a/k/a ‘Telling the truth identifies you as a Russian Asset’) [/sarc, for the underequipped]
And you should really stop playing the victim card (“drop an insult”), especially if you cannot take the echo to your own actions in this thread.
You are insane if you can find all that nonsense in a simple statement. You certainly have a resentment going over something. Your retorts get crazier each time.
Anything specific you can point at?
Also you may want to count how many ad-hominems you used, compared to my count, before talking about “crazy.”
Holy sheet!
Time to dust off the “…since Lehman” slogans
Its a Lehman Sunday today March 6th 2020 bro….the mkt circuit breakers will be engaged this week, lets just sau I am in the know and a little birdie told me so…..
March 8th Brot
“As investor rush to safety”. Yeah where and what is safe??? There will be a huge rush into gold and silver as the bond market will crash also and any idiot hiding there will be crushed too.
All paper “financial instruments” are in peril. If you can’t hold it in your hand you don’t own it. You may win the “bet” but what happens when nobody can pay?
The “Markets” are having a Correction:
Let’s hope it is a proper Correction.
Zerohedge comment:
Flights cancelled, pilots on forced leave, lease payments on planes due, insurance companies being hit with cancellations claims, Oil Longs incinerated and shorts don’t want to touch it, cheaper fuel coming at a cost to profit on the bottom line, Airline Jet fuel price hedges now take or pay, 401’s decimated, defined benefit schemes now cannot fund them, tax take falls, hospitality workers told services not needed, travel companies laying off or shortening hours, Hotels vacancy rates soar and cleaners/ maids/ laundry services halved, 2nd incomes disappears as temporary staff waylaid, Mortgage payment / Rent due but hours shortened with subsequent lose of income, Banks have no margin at near zero interest rates and defaults on loans start to become a reality,
Stock Margin calls sound like bells in an abbey, the realization occurs that printing money does not create one grain of rice nor does it plant harvest or eat it of it, labor self isolates and production falls, casuals have no sick leave and must work thus spreading the pain, the World FX markets become a turmoil of miss steps and reactions, Costs mount just in the containment and the infected overwhelm the available beds, Algorithms just fall of the ladder and cause more selling which begets more selling, Central Banks have zero effective tools to fight a moving ghost, the list goes on….
Then … POOF just like that the exuberance of the ‘Stock Market” is replaced by the sober reality … Its gone!!
https://www.zerohedge.com/markets/market-massacre-oil-crashes-30-dow-down-1000-points-vix-explodes-es-craters
Joe Lunchbucket thinks he’s going to get a break by saving 20 cents on gasoline. Meanwhile, this will trip the derivative bomb that the crackpots on fringe podcasts have been talking about for 10 years. The end of shale fracking as well, causing a cascade through all finance and credit markets. Leverage, margin, debt, lack of savings. In short, the system is too fragile to handle this shock. The true elite will always benefit. They will be bailed out one way or another. The douchebags in McMansions as well as the little guy are supremely screwed. Government will also figure out a way to negate any hard assets they may have been wise enough to accumulate through the stroke of a pen. The big guys must be bailed at any cost.
But it’s certainly fun to watch it all collapse. Aren’t all you old timers thrilled? Did you really want to go out without seeing the end of this paradigm of unrelenting debauchery and bullshit? Nature is pulling us kicking and screaming out of our smartphone-induced fairy tale and back to cold, hard reality.
It wasn’t only “ fringe crackpots” who were screaming about the derivatives monster bubble of all bubbles by the way
Keep flapping your gums about stocks.
Meanwhile, the UST will gut pension funds like so many fish.
They’re already gutted, but the fish just don’t know it’s dead yet.
Oops, forgot about the idea to nationalize pension funds into Social Security. If they could do that with employer paid health insurance, making employers pay for unemployed folks, then they can make pension funds cover SS folks faking disabilities and shit.
Now that is scary shit.