Twenty-two years ago today, the American capital markets basically shut down for a week. No one was allowed to fly. Remember the heroic efforts find office space away from downtown NYC and to get the New York Stock Exchange and bond markets functioning again? Odd thought, maybe one should just do little to nothing for the next month?
There are building pressures that will make the path forward for the economy and capital markets more than a little rough. Volatility will return big time.
The banking crisis is hardly over for one. Take a look at what is happening with bank deposits at smaller banks. It is worse than in March!
The price of oil is now higher than when Biden started selling off much of the strategic petroleum reserve. The Democrats are going to panic since the price of gas so influences election results.
The equity markets have powered higher led by Nvidia and the promise of generative AI. What will happen if Nvidia's demand for GPUs is demonstrated to be overstated? The nifty seven are likely to correct significantly in that event. Can your portfolios withstand a 35% decline in Apple, Microsoft and/or Alphabet?
We have done little to correct the forthcoming debacle in commercial real estate, and the auto workers are about to go out on strike. Oh, and the Federal government is likely going to experience a full shutdown before the start of 2024, while President Biden gets impeached by the House of Representatives for influence peddling.