After The Crash, Another Wave Of Bad News Will Be Coming
Submitted by QTR's Fringe Finance
I am not a financial professional, and nothing in this article should be construed as financial advice. Please consult your own financial advisor before making any investment decisions, and read my full disclaimer at the bottom of this post.
After yesterday’s absolute bloodbath in the Nasdaq, which fell more than 5%, I wanted to follow up on a few things I’ve learned watching these types of market events unfold over the years, what I’m seeing this morning, and why I think the next several days could be just as important as yesterday’s selloff itself.
(Photo: Some guy doing something important while I write a financial column full of toilet humor in my pajamas at 6AM,. Yahoo Finance, 2026)
While yesterday may have been the day the market finally began acknowledging some of the risks I’ve been writing about since August, I suspect we’re only beginning to find out exactly how much damage has been done. And, as usual, the market isn’t going to make that process particularly easy because sure, there’s nothing wrong with releasing positive guidance out to 2030 or whatever Oracle did last week, but when it comes to negative news that’s material now…well, no one wants to piss in the punch bowl.
The first thing I want to note today is that usually, volatility tends to beget volatility…and I’m talking about directionally agnostic volatility. When you get a move as violent as yesterday’s, there’s nothing wrong with expecting similarly violent moves in the opposite direction. In fact, as I write this, Nasdaq futures are already up nearly 2% this morning.
This is not surprising to me. I feel like it’s exactly what happens when markets begin repricing risk in a hurry. Shorts cover, dip buyers show up, traders who were caught offsides scramble to reposition, and investors who have spent the last several years being conditioned to buy every decline convince themselves that yesterday was another golden opportunity to pick up their favorite technology stocks at a discount.
CNBC this morning
Maybe it was, but I would caution against declaring a violent bounce with an actual mid to longer-term bottom. Some explosive rallies in market history have taken place during sustained bear markets. When positioning becomes extreme and liquidity deteriorates, markets can rip higher with extraordinary speed without changing the underlying trend. A 2% bounce after a brutal selloff doesn’t necessarily mean the selling is finished any more than one terrible day means every stock in the market is suddenly worthless.
Both things can be true: the market can rally violently, and the broader trend can remain decidedly lower. In fact, I would expect precisely that type of action if we’re entering the prolonged repricing of the AI trade that I’ve been warning about. The important thing, in my opinion, isn’t whether the Nasdaq manages to bounce today. It’s whether the fundamental assumptions that supported its previous valuations are still intact.
But there’s something else I think is even more important this morning: yesterday was the crash…but the next several days are when we start finding out who actually got hurt. Markets can reprice trillions of dollars in a matter of hours, but figuring out where those losses landed, who was leveraged, who was forced to liquidate, and which counterparties were exposed to the wrong people at the wrong time takes considerably longer.
I would expect...(READ THIS FULL ARTICLE HERE).