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Market Uncertainty Has Never Been Higher
The CBOE's VVIX Index, "an indicator of the expected volatility of the 30-day forward price of the VIX" reached extreme levels this week. While all eyes are firmly focused on the to-ing and fro-ing of VIX (the so-called 'fear' indicator), it is the uncertainty of that fear (or greed) that is exploding as VVIX measures. Simply put, the chance of VIX doubling, or tripling, in the next 30 days (which include the final POMO and Fed 'end of QE' meeting), has never been higher.
Chart: Bloomberg
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The Dragon-Kings are coming !
See
http://andreswhy.blogspot.com/2013/11/dragon-kings.html
A derivative of a derivative of a derivative. The chances of the market going up or down has now reached a feverish 100%. The real question is: What if there is no market any more and the numbers are just made up on a computer terminal somewhere in the Eccles building?
Somebody' s in dreamland.
"VVIX Index, "an indicator of the expected volatility of the 30-day forward price of the VIX""
That's what we need. A derivative of a derivative. Fine work, gentlemen. Fine work.
That would be acceleration.
Which is great and wonderful when dealing with physics, not so much for economics or the social "sciences".
Derivatives are only safe in the hands of a rocket scientist.
I thought the market is both up and down, until you look at it. My head is going to explode.
Quick, go to DC if your head is going to explode. Via Dallas.
Will you still love me when the dream is over Lola, that's all that matters.
You're one strange bird, Harbanger.
Rare and timeless but not strange.
Yeah; fortunately I'm not naive enough to care about this. it comes under the class of things that mean less than nothing.
I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do...
www.work-reviews.com
And gold and silver are having their life squeezed out of them even as volatility skyrockets. Given HFT computers, modern markets have proved to be remarkably easy to manipulate.
How many Kevin Henrys work for the Fed?
ISIS finding all that metal sure put a hurtin on the price.
Silly wabbit, gold is going to zero on the spot. Paper is going to zero. The real stuff will be unobtainium at some price no one knows.
A human made system is managed by humans.
Central command will decide when the system will go through wipeout and that decision depends on world trade.
World trade is going down the drain now precisely due to Quantitative Easing and USA non-interventionism.
The longer the wipeout is delayed, the more and the faster economic misery will expand.
Financial market decides absolutely nothing, never did and never will.
It is world trade that influences decision, not financial markets.
I agree, except central command has zero control over truth or finance, central commanders will GTFO right when the market spikes. The same fuckers who will present a solution for our problems after the fall are the same ones who should be lynched for causing it, time will tell.
ekm1
Do you work for the IMF or the World Bank?
"World trade that influences decision, not financial markets."
You ought to be kidding us?
Nobody cares about IMF, absolutely nobody.
IMF is like college economics department.
ekm1
Well well well, you have a problem here:
Michael Hudson: The basic principle to bear in mind is that finance today is war by non-military means. The aim of getting a country in debt is to obtain its economic surplus, ending up with its property.
The main property to obtain is that which can produce exports and generate foreign exchange. For Ukraine, this means mainly the Eastern manufacturing and mining companies, which presently are held in the hands of the oligarchs.
For foreign investors, the problem is how to transfer these assets and their revenue into foreign hands – in an economy whose international payments are in chronic deficit as a result of the failed post-1991 restructuring. That is where the IMF comes in.
The IMF was not set up to finance domestic government budget deficits. Its loans are earmarked to pay foreign creditors, mainly to maintain a country’s exchange rate. The effect usually is to subsidize flight capital out of the country – at a high exchange rate rather than depositors and creditors getting fewer dollars or euro. In Ukraine’s case, foreign creditors would include Gazprom, which already has been paid something.
The IMF transfers a credit to its “Ukraine account,” which then pays foreign creditors. The money never really gets to Ukraine or to other IMF borrowers. It is paid to the accounts of foreigners, including foreign government creditors, as in IMF loans to Greece.
Such loans come with “conditionalities” that impose austerity. This in turn drives the economy even further into debt – forcing the government to tighten the budget even more, run even smaller budget deficits and sell off public assets.
http://www.informationclearinghouse.info/article39034.htm
And michael hudson is correct.
But war by non-military means no longer works now.
Putin, Jinping, Khamenei all world is clashing
The world learned that game and is no longer affraid of it
The world learned that game and is no longer affraid of it
So, in your view;
First: The oil price war orchestrated by the US and Saudi to bankrupted Russia, as well as the BRIC’s, will fail. Or, am I wrong?
Second: And, if it doesn’t fail?
War.
Nothing unusual
Don't you think the IMF will come in after the financial fall to save the World with their SDRs?
Nobody cares about SDRs
World fears only the sound of guns, missiles, carpet bombing etc.
IMF has no army. Nobody cares about IMF
Why the uncertainty? Where is all the good news? If bad news is good news, why isn't the market going up and up and up? This time bad news is bad news and the bad news is getting worser.
FED hit the wall and stuck there. Even if they print again it's an admission they're frauds because US unemployment is 5.9% by their own fake reckoning.
Fake reck rooms, I hate that.
Does Rogue Swan trump Dragon-King ?
http://andreswhy.blogspot.com/2013/11/dragon-kings.html
https://www.academia.edu/8816411/Rogue_Swan_EU_disintegration
can I get a phoenix? so it never dies..
or how about a thunder lizard? or rainbow pooping unicorn?
Investors have always dealt with outcomes that are not only uncertain, but unknowable. What's different this time is that their uncertainties are about the markets themselves, not the investments. Instead of asking, "Is Apple a buy at $95?", they're wondering, "Are all these HFT flash crashes going to lead to a general freeze-up where I won't be able to buy or sell when I have to?" or "How close are we to a banking accident?"
Amish Hacker
Who asked you to invest in Ponzi schemes?
ekm1: "Remember, it is central control. There is no credit system. Only reserve system. Gov provided all money"
So, the next meltdown? Don’t worry; it will be the last one.
There are no Markets, Amish. Since the crash that already happened in 2008, it's all about keepin the patient alive a little longer. Sometimes I wish I were Amish, to live a Christian life with my brothers/sisters in harmony without worry. I'm not sure for how long that will be possible in the US without a revolution. -Also Amish, when people fuck with my home and loved ones, and the US is my home, I will defend her like a old school gamebred American Bulldog.
Harbanger
First: There was NEVER a market in the US, because US is an Empire. If I can borrow Chomsky’s quote: “America’s elites know that capitalism is totally unworkable. We try to impose it in the 3rd world so we can destroy them”.
Second: What’s holding you back to live like an Amish?
Third: Revolution in America? Try Civil-War. That’s more likely.
To say there was never a market in the US is naive and ridiculous. The US as a modern global empire is true, as in a financial empire after WWII, rightfully so, they withstood WWII. As far as Chomsky, he was a progressive and globalist. Was because the angel of death has called his name. Revolution vs Civil war. Do you even understand the difference?
So, the US got to be an Empire, with half of the world’s wealth, consuming about ¼ of the global energy, being the largest world’s consumer, and with the most prosperous middle-class…. By marketing what?
"The acquisition of Canada this year, as far as the neighborhood of Quebec, will be a mere matter of marching, and will give us the experience for the attack on Halifax, the next and final expulsion of England from the American continent". -- President Thomas Jefferson
The main reason US gave up conquering Canada it was because Americans couldn’t acquire supplies from the locals.
Also, have you ever wondered how South America debt, after their military coups with US government support, skyrocketed?
Harbanger,
US never had a real market, compared to other nations, because of these advantages:
In 1846 was the beginning of US war machine —Military Industrial Complex (MIC)— by invading Mexico and stolen about half of Mexico. Link here.
In 1896, America turned its ‘Global War-Machine’ (MIC) into an Empire, by moving into Central America and kicking Spain [an US allied against the British] out. Even the Philippines was taken from Spain. Then, it created the Down Jones 12 industrial stocks.
1900 election [McKinley] campaign was focused on expanding a) US imperialism abroad, b) Protectionism [products had to be made in America], and c) High-tariffs [if the ship carrying any products, to or from America, didn’t have US flag].
In 1944 came Bretton Woods: Dollar as World’s Reserve Currency. It means: United States would use the convertible financial system to trade at a tremendous profit with developing nations, expanding its industry and acquiring raw materials. It would use this surplus to send dollars to Europe, which would then be used to rebuild their economies, and make the United States the market for their products. This would allow the other industrialized nations to purchase products from the Third World, which reinforced the American role as the guarantor of stability.
A trade surplus made it easier to keep US armies abroad and to invest outside the U.S., and because other nations could not sustain foreign deployments, the U.S. had the power to decide why, when and how to intervene in global crises. The dollar continued to function as a compass to guide the health of the world economy, and exporting to the U.S. became the primary economic goal of developing or redeveloping economies. This arrangement came to be referred to as the Pax Americana, in analogy to the Pax Britannica of the late 19th century and the Pax Romana of the first.
And this was a bad deal for us?
Just like the Brits trading in the world's largest empire in return for taxpayer funded colorectal examinations was a good deal for them?
tarabel
For us, you mean, for us, in the US?
If that is what you meant, not at all. We, in America, experienced unimaginable wealth. We’re gonna missed it, when it’s gone.
Sorry, I didn't quite understand your second question.
"The ONLY winners in War are the one's who lend you the money to wage it" Ezra Pound
"Same as it ever was...Same as it ever was...Same as it ever was...." Talkings Heads 1980
Citizen_x
Next war? Same as it ever was?
I think you're for an unpleasant surprise.
"I don't know (how WW-3 will be fought). But I can tell you what they'll use in the fourth. They'll use rocks!" – Albert Einstein
I believe you have taken Chomsky out of context......again.
Which part?
... that capitalism is totally unworkable. (Because it eventfully becomes unprofitable, unless that corporation has a monopoly or is protected by the state).
Or,
We try to impose it in the 3rd world so we can destroy them. (Because the corporations can have the opposition killed or pay for a Coup d’état).
the only market uncertainty i am aware of is yellens... "vagisil or ky?"
Money is for children .
Promises and interest rates are for slightly older children .
Exchange rates are for adults .
The one sure certainty :
Debt Moratorium
Like what happened to WW I debts .
Not forgiven .
Just moribund from moratorium .
An exchange rate of zero .
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In 1931, President Herbert Hoover announced a one-year moratorium on war loan repayments from all nations, due to the global economic crisis, but by 1934 Britain still owed the US $4.4bn of WWI debt (about £866m at1934 exchange rates).
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Still not repaid .
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History of the British national debt - Wikipedia, the free ...
en.wikipedia.org/wiki/History_of_the_British_national_debt
FeedbackWhat will happen if the US tries to recoup these debts (with interest) ?
Many other countries are involved .
The mind boggles .
"In the markets of the Morgue
The Valkyries of Vix
drown quant and borg
to beyond the Styx"
This doesn't make any sense. Has the market become a collection of fearful cream-puffs that are now afraid of their own shadow after a period of ridiculous complacency? The SPX hasn't even dropped 10%.
Or is there something trembling under the surface that only the big money knows about?
Yes
Can someone please explain the VIX.
I my mind volatility is when stuff goes up and down lots!
Why does the VIX only go up on big down days and not big up days.
It acts more like an inverse market indicator.
So the VVix is preempting a big down move?????
The VIX is volatility and is strongest at market turns.
Markets tend to grind up and crash down with some new development that knocks people out of complacency.
The stock market will bounce here for a week or so but likely retest the lows before a final low.
I just figured out why the damage will be so great here in the U.S.. The population is so trained to think a certain way, failure is guaranteed. Think about this: in the Weimar Republic, the currency totally collapsed, and it took only about a month to become worthless. You have to wonder what percentage of the population remained in denial in week one, week two, etc., and how it will go down here. Most Americans are dumb as a rock when it comes to understanding the financial system, and I'm sure the MSM will be the government megaphone every step of the way through the collapse to land us right where they want us. I'm sure it's been rehearsed several times already.
Nothing will happen because we expect it (e.g. the indicator). IT will happen when we least expect it.