Do You Know That The Black Swan Is Invisible ? – Weekend Market Talk
The reason is, it would not be a Black Swan anymore if we can see it.
Lucky you if you had a fun filled weekend shopping in Chinatown, soaking in the lunar new year spirit and festivity in this simply salubrious weather, temperatures in the low 20’s with nice northerly winds.
Furrowed brows, mostly, for the people I have been talking to, starting with some rumours of potential losses looming in some of the US EM funds and ETFs for Latam, Asia and MENA. Talk is that sell orders are mounting and in queue for EEM US, an emerging market ETF that is also the most popular.
More talk on the Deutsche Bank’s surprisingly bad results and whilst reporters have made little fuss over the bank’s outlook, the grapevine in the markets is all abuzz on the EUR 623 million charge for various valuation adjustments and the potential impact on derivatives.
The big straw, however, is the HSBC story which has apparently been denied. http://topinfopost.com/2014/01/25/hsbc-bank-may-collapse
Definitely bad timing after the default scares in China last week and at a time when all is looking weak and Argentina looks like she just gave up by loosening currency controls for individuals.
If you still do not appreciate the severity of it all, this may jolt a little reality.
Citi reports that this S&P sell off in the past 2 days, for all its 3.14% only minor correction, may not be as minor in the bigger scheme of things. Because things have been too good on cruise control, the sell off is a 4.46 standard deviation off its 3 month volatility. That is the 3rd largest in the past 15 years.
Retired Trader says this could be a Roasted Swan and the definition of a market top is not when the smart seller has sold, it is when the last buyer has bought.
With all these headlines and rumours swirling around me and half intoxicated on pineapple tarts, Roubini strikes again. http://www.businessinsider.com/nouriel-roubini-mini-perfect-storm-2014-1
Why does this not feel like it is all a coincidence ?