Given the ongoing market volatility, here's a series of notes & quotes from @biancoresearch and @AshBennington on today's @RealVision Daily Briefing:
📝 🧵👇 (n/7)
📝 🧵👇 (n/7)
1// -20% Market Correction in the S&P 500
>> From the previous high to today's intra-day lows, the S&P 500 reached the -20% drawdown threshold.
>> Many stocks have experienced large negative price performance thus far in 2022.
#Markets #investing #volatility
>> From the previous high to today's intra-day lows, the S&P 500 reached the -20% drawdown threshold.
>> Many stocks have experienced large negative price performance thus far in 2022.
#Markets #investing #volatility
2// S&P 500 Has Fallen for 7 Consecutive Weeks
>> The last time this happened was in 2001 (Jim Bianco)
>> Here's the $SPX data from Koyfin for Friday closing prices: 📉😢
4/8: 4,502.29
4/14: 4,392.59
4/22: 4,271.78
4/29: 4,131.93
5/6: 4,123.34
5/13: 4,023.89
5/20: 3,901.36
>> The last time this happened was in 2001 (Jim Bianco)
>> Here's the $SPX data from Koyfin for Friday closing prices: 📉😢
4/8: 4,502.29
4/14: 4,392.59
4/22: 4,271.78
4/29: 4,131.93
5/6: 4,123.34
5/13: 4,023.89
5/20: 3,901.36
3// Contributor to Recent Market Volatility
>> "Fed policy, as part of its arsenal, can lower stock prices to reign in demand to bring down inflation" - @biancoresearch
>> Declines in housing prices & asset prices (bonds, equities, crypto) can cause negative wealth effects.
>> "Fed policy, as part of its arsenal, can lower stock prices to reign in demand to bring down inflation" - @biancoresearch
>> Declines in housing prices & asset prices (bonds, equities, crypto) can cause negative wealth effects.
4// Negative Wealth Effect
>> Negative wealth effect can cause consumer spending & demand to decrease. Deceleration (or decline) in demand + catching up of supply chains + slowing economic growth can cause inflation rate to decline.
>> Historically, recessions kill inflation.
>> Negative wealth effect can cause consumer spending & demand to decrease. Deceleration (or decline) in demand + catching up of supply chains + slowing economic growth can cause inflation rate to decline.
>> Historically, recessions kill inflation.
5// Risk Factors
>> Tightening monetary policy, inflation, geopolitical risks, concerns of economic slowdowns, and more are several of the current risk factors in impacting current financial markets.
>> Large drawdowns & losses in one asset class can impact other asset classes
>> Tightening monetary policy, inflation, geopolitical risks, concerns of economic slowdowns, and more are several of the current risk factors in impacting current financial markets.
>> Large drawdowns & losses in one asset class can impact other asset classes
6// Labor Markets
>> According to FRED, there are over 11.5 million job openings available, while there are about 5.9 million unemployed individuals. That's a ~1.9 ratio.
Sources:
>> Job Openings, fred.stlouisfed.org/series/JTSJOL
>> Unemployed Individuals, fred.stlouisfed.org/series/UNEMPLOY
>> According to FRED, there are over 11.5 million job openings available, while there are about 5.9 million unemployed individuals. That's a ~1.9 ratio.
Sources:
>> Job Openings, fred.stlouisfed.org/series/JTSJOL
>> Unemployed Individuals, fred.stlouisfed.org/series/UNEMPLOY
7// Supply Chains
>> Bullwhip effect
>> Global shipping & freight & trucking
>> Inventory management & over-ordering
>> Rolling supply shortages & constraints exist across a range of products
>> Challenged supply chains contributed to supply constraints & delivery delays
>> Bullwhip effect
>> Global shipping & freight & trucking
>> Inventory management & over-ordering
>> Rolling supply shortages & constraints exist across a range of products
>> Challenged supply chains contributed to supply constraints & delivery delays
• • •
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