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Past Fear, Present Fear
From Slope of Hope: I was looking at the entire history of the volatility index (the oft-cited "VIX') and found an interesting parallel. Take note of this chart
So what we have here is:
+ Cyan tint - a grinding, multi-year slide following the bursting of a gigantic bubble. In this instance, it was the bursting of the Internet bubble, and during Greenspan's deliberate inflation of the housing bubble, investors got calmer...........and calmer.
+ Yellow tint - The slide seemed to be over, and there was a period where fear seemed to be coming back. However, it really never seemed to take hold.
+ Magenta tint - Just when it seemed that fear was forever outlawed, and the VIX cracked briefly to lows never seen before (Grey tint), there was a sudden burst higher in volatility. In the case of February 2007, it was when the Chinese stock market made a brief tumble.
+ Green tint - Nope, the fear index falls back again to similar levels it has been grinding around at for a while. The "VIX fix" seems to be permanent.
Now take a look at more recent history, and apply every single one of those descriptions to the chart below. The only difference I see is that the most recent burst (Magenta) was muted compared to the one from 2007.
Of course, after nearly six years of this nonsense, even someone like me starts to worry that, for the first time in the history of the universe, It Really Is Different This Time. But, ummm, that's kind of what they want us to think, isn't it?
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When the abnormal becomes the norm bad shit happens.
Proof of the increased domination of the Vix and its components by the Fed and its minions.
They can't do it forever. Gravity is always there. As soon as a strong enough wind blows on the house of cards the Fed has built, gravity will take care of it.
2015?
or 2016?
or 2014?
or infinity?
Don't think much will happen 2014, things just don't seemed to have tanked enough in the real economy to be able to slip out of central control yet.
and it can't go on for infinity since you can't run from reality for ever.
Kind of like the population levels of locusts; it drops off for a number of years until the next locust swarm explodes again.
Um, say what?
Is some of this actually the influence of HFT? All those penny trades suppress volatility.
You can throw your rock, hide your hand
Workin' in the dark against your fellow man
But as sure as God made black and white
what's done in the dark will be brought to the light
STFU and print.
Follow the Fed.
Hahahahahahahahahahahaha
The fed is the market, the market is the Fed.
Banksterz know best.
MMMMMMMMMMMMMMMkkkayyyyyyyyy?
I just got a job at Wall Street.
They bring in these big, black fuckin' birds...
I get paid to paint them white and to release them.
It is always different until it isn't different. That's when everyone involved
says: "Why didn't anyone see this coming?" Because greed is a blinding light.
It is time for all of us to put on our sunglasses.