VIX Plunges To 5 Year Low

Tyler Durden's picture


VIX at its lowest (sub-14%) since Summer 2007...

and the Volatility term structure, its steepest EVER...


Short-term volatility (risk) is the lowest relative to medium-term risk EVER - is this the biggest ever levered bet on FOMC calmness into European election event risk? Or more technically is this late forced unwinds of legacy long vol/steepeners into the Greece March 20th event risk (which seemed like a decent trade looking for a risk-flare). Given the steepness of the rest of the curve, it certainly feels very technical (flow) driven.

Charts: Bloomberg

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Tue, 03/13/2012 - 09:57 | 2250138 rajat_bhatia
rajat_bhatia's picture

The Vixens are getting ready to ........

Tue, 03/13/2012 - 10:01 | 2250158 JPM Hater001
JPM Hater001's picture

Oh no.  I'll get the stuff ready...we're goin over 13000.

Tue, 03/13/2012 - 10:07 | 2250183 spiral_eyes
spiral_eyes's picture

i heard we were going over 36000

Tue, 03/13/2012 - 10:10 | 2250194 SilverTree
SilverTree's picture

I voted for Dr Paul and 24 of his delegates today in Alabama. It would be nice to vote again for him in the General.


Alas, I fear it is too late.

Tue, 03/13/2012 - 10:14 | 2250214 Winston Churchill
Winston Churchill's picture

Death was pronounced in 2008.

Just waiting for bowel evacuation of corpse.

Tue, 03/13/2012 - 10:28 | 2250264 Killtruck
Killtruck's picture

You, sir, have a brilliant grasp of both the situation and the english language. Well played and nicely put.

Tue, 03/13/2012 - 10:57 | 2250368 JPM Hater001
JPM Hater001's picture

Wow- we are up 78!  This is AWESOME!!!!!!!


Tue, 03/13/2012 - 13:02 | 2250806 Winston Churchill
Winston Churchill's picture

Thank you.

Like my namesake.American mother..Hoever Swiss anglophile father..

English public school.not Eton.


Tue, 03/13/2012 - 10:19 | 2250231 naiverealist
naiverealist's picture

Never forget about the last bastion of voters choice, the WRITE IN vote.

Tue, 03/13/2012 - 10:28 | 2250268 Dr. Engali
Dr. Engali's picture

I'll be writing his name in when I vote.

Tue, 03/13/2012 - 10:28 | 2250270 unununium
unununium's picture

Your pseudonym is very apropos.

Tue, 03/13/2012 - 12:21 | 2250641 Lost Wages
Lost Wages's picture

Do the Diebold machines have a spot for write-ins? Because the only way I will vote this year is if I can put in my own name.

Tue, 03/13/2012 - 12:36 | 2250698 LeBalance
LeBalance's picture

mickey fucking mouse.

Tue, 03/13/2012 - 10:39 | 2250306 Hansel
Hansel's picture

Video: Santorum recommends voting for Ron Paul

Teh lulz, hahahaha.

Tue, 03/13/2012 - 11:12 | 2250432 Ruffcut
Ruffcut's picture

We can't find a fix, so let's play with the vix. CBOE, criminal bitchezz of evil.

Tue, 03/13/2012 - 09:57 | 2250139 LongSoupLine
LongSoupLine's picture

Some cheap f'ing puts is how I see it...

Tue, 03/13/2012 - 09:59 | 2250151 resurger
resurger's picture

no shit!

i have seen puts 150,000K! thats normal


Tue, 03/13/2012 - 09:57 | 2250140 Squishi
Squishi's picture

even ice melts.

Tue, 03/13/2012 - 09:58 | 2250143 spiral_eyes
spiral_eyes's picture

Greece defaults (the moment of supposed disaster) and the world decides that there is now less voltaility than ever.


Hurrah for central planning! Hurrah for big government! Hurrah for socialism to save capitalism! Newly-printed 010101110001010100101 for everyone!

That's what a recovery looks like, extension and pretension! 

Meanwhile, back in the real world...

Tue, 03/13/2012 - 10:31 | 2250272 SheepDog-One
SheepDog-One's picture

YEA amazing isnt it....the 'What can never be spoken' moment Greek default happened, and no one even batted an eye. But for TWO YEARS we were told we had to bail it out and support it and do whatever it took to fix it because a default would be SO terrible and all...just been played by the criminals big time.


Tue, 03/13/2012 - 10:52 | 2250350 toothpicker
toothpicker's picture

A big thanks to our controlled media: "nothing to see here"

Tue, 03/13/2012 - 12:30 | 2250678 rqb1
rqb1's picture

well said

Tue, 03/13/2012 - 09:59 | 2250147 fonzannoon
fonzannoon's picture

If the vix and it's variations are so low why do I keep reading that they are still at a substantial premium to NAV therefore implying that the still could have a way to go on the downside?

Tue, 03/13/2012 - 10:00 | 2250153 Comay Mierda
Comay Mierda's picture

double top in spx, downward wedge in vix, back up the truck!

Tue, 03/13/2012 - 10:02 | 2250167 Cdad
Cdad's picture

Yep...VIX time compression trade.  Grab the front month.

Tue, 03/13/2012 - 11:16 | 2250455 Stoploss
Stoploss's picture

Skew is 139 an a quarta. It's only been higher one time, and not by much. Not so sure VIX is still reliable, but there's nothing else.

Tue, 03/13/2012 - 10:05 | 2250178 resurger
resurger's picture

think of VIX as a CDS against equity shock:

in my perspective, the higher the stocks go from now on (am thinking this is the top because of volume) the more investors will be attracted to hedge their risk, so i think we will reach a stage where stocks are in the green, and the vixes are also in the green..


Tue, 03/13/2012 - 10:20 | 2250232 dwdollar
dwdollar's picture

I'm trying to resist the urge to trade paper, but my inner bear is restless.

Tue, 03/13/2012 - 13:28 | 2250886 Nobody For President
Nobody For President's picture

double top in spx, downward wedge in vix, back up the truck!


Let us wax poetic:

Double top in spx,

Downward wedge in vix;

Back up the Truck

You dumb fuck, 

And give Bens' backside some licks.

Tue, 03/13/2012 - 14:19 | 2251105 GovtMediaLiars
GovtMediaLiars's picture

I'm of the view that yesterday and today's action in the VIX is the culmination of the bottoming process that it has been undergoing for a couple weeks. 
And we don't believe that it can move sideways for long in the current environment. 

It's too bad the VXX is such a terrible vehicle but there are certainly other volatility plays to consider. Tough not to be long equities right now but on the other hand some kind of hedging is clearly in order here and going long volatility in some form could certainly be an option to consider.

Market Madness
Market Madness Metals

Tue, 03/13/2012 - 10:00 | 2250156 Jason T
Jason T's picture

so puts can be bought quite cheaply.  


All I know is, China built 9 milllion cars in 2009 and 18 million in 2011, just 2 years later.  This idea that oil and gas is up only temporary is a complete load of crap.  The wealth of the world has moved from the US to China ..and like lightening, it'll strike that the masses realize it.

Tue, 03/13/2012 - 10:28 | 2250266 SheepDog-One
SheepDog-One's picture

Thats how I see it. While most everyone believes theres '3 years till somethin happens' or whatever, I believe the opposite, this will be brought down by some 'event' out of left field 'no one saw comin' and gives perfect cover for the FED banksters as they make off with all the loot and leave Avg Joe retail investor broke.

Tue, 03/13/2012 - 10:01 | 2250161 NEOSERF
NEOSERF's picture

Computers can't feel emotion and thus tend towards complacency

Tue, 03/13/2012 - 10:11 | 2250165 ekm
ekm's picture

Central planners believe they can decide when to HOLD UP the market and .......when to CRASH it.


Hence, they want to hold it up during GREEK CDS clearances and than allow it to "slowly" decline.


Tue, 03/13/2012 - 10:05 | 2250169 Dr. Engali
Dr. Engali's picture

Let's see, we are on the verge of war with Iran, all hell is breaking loose in Afghanistan, gas prices are through the roof, house prices are still falling, the Euro is falling apart,and the vix is at a 5 year low. Sleep little sheep ,sleep. Don't worry this will end well.

Tue, 03/13/2012 - 11:16 | 2250454 Zero Debt
Zero Debt's picture

Those are all known pieces of information and are already discounted. It would take something unexpected to make VIX shoot up (i.e. equities to move in either direction to affect vol term structure) such as events that would derail the debt ponzi, e.g. actual "disorderly" (ordinary) defaults, a two-notch US devt rating downgrades out of the blue, sudden talk about austerity referendum in a new place e.g. Spain, etc.

Tue, 03/13/2012 - 12:04 | 2250601 francis_sawyer
francis_sawyer's picture


Quiet! You're disturbing my concentration on filling out my NCAA brackets...

Tue, 03/13/2012 - 10:23 | 2250175 DormRoom
DormRoom's picture

when you have this much Central Bank intervention it distorts market signals, and mask risks.   Can't tell up from down.  EURUSD signal broken.  VIX signal broken.  Libor rate broken. CAn't even trust Okun's law. wtf.

Tue, 03/13/2012 - 11:45 | 2250558 359766
359766's picture

trust yourself ... there aren't (m)any other options.

Tue, 03/13/2012 - 10:04 | 2250177 ekm
ekm's picture



Tue, 03/13/2012 - 10:14 | 2250210 GeneMarchbanks
GeneMarchbanks's picture

Ixnay on the APSKay, what say?

Tue, 03/13/2012 - 10:39 | 2250303 ekm
ekm's picture

Not into trading. I can't understand what you're saying.

I'm a macro guy.

Tue, 03/13/2012 - 11:03 | 2250395 WonderDawg
WonderDawg's picture

LOL Uh, he's asking you to stop screaming, in Pig Latin.

Tue, 03/13/2012 - 11:12 | 2250439 ekm
ekm's picture

Ok. Sorry.

Tue, 03/13/2012 - 11:14 | 2250441 ekm
ekm's picture

A lot of mental cocaine on Zerohedge.

Tue, 03/13/2012 - 12:06 | 2250604 francis_sawyer
francis_sawyer's picture

Do Italian swine speak "pig latin"?... Just asking...

Tue, 03/13/2012 - 10:56 | 2250360 pods
pods's picture


Note to self: Buy keyboard cover.

Tue, 03/13/2012 - 11:19 | 2250460 ekm
ekm's picture

I apologize. I'll try to remember not to use capitals for the whole post.

English is a bastand language anyway.

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