#JustDarioDaily
⚠️This is A T-1000
#stocks Market⚠️
Who remembers the T-1000 from Terminator 2? Schwarzenegger (a less powerful T-800) could shoot anything at that machine, but no matter what, it was impossible to kill. Doesn’t today's market feel pretty much the same? 🤔
#Evergrande ;
#CountryGarden ;
#WeWork ;
#CreditSuisse ;
#SiliconValleyBank ;
#FirstRepublicBank #UkraineWar ; German
#Recession ;
#UK Pensions ; record
#yields;
#china slow down … gosh the list is getting so long… 🫣and yet despite all these bullets being shot at its body,
#stocks regenerate every time like the T-1000.😨
These days the chatter about a new strong
#covid strain is intensifying, personally I heard from several people I know across various countries getting sick again, including in the small 10,000 people town in Sicily where I am at the moment. However, do you know what I think? Even if they find an excuse to lock the world home again this time
#stocks will hardly be bothered.
The T-1000 finally dies when they manage to throw it into a vat of molten steel. Eventually the only thing that could kill the T-1000 was the very same substance the machine was made of.
What if the only thing that can trigger a true
#lehman and prick this (insane) bubble is the very same thing that is making this bubble apparently indestructible? Liquidity then is the key. 👀
Liquidity is like oxygen for financial markets, till is abundant prices can still survive at the top of Mount Everest. However, there is a big part of the global financial markets where liquidity is starting to become scarce:
#China.
I explained before like in China
#stocks are not that of a relevant part of the household wealth differently from other major countries like
#US. For example today Evergrande resumed trading, it collapsed 90%, and yet it didn’t trigger any catastrophic event mostly because China is still committed to keep pumping liquidity in its
#stocks market and keep all afloat. Foreign investors are mopping up all this fresh liquidity and moving it back home to keep feeding their own domestic bubbles.
Now, what if China throws the towel and finally shifts the focus to (finally) troubleshoot their domestic economy rather than helping
#Blackrock & Co. to divest the hundreds of billions they invested in Asia and that they now want to take back? At that point, the only “active printer” in the world left will be the
#BOJ. Sadly, at these yields,
$JGB are returning to be an attractive investment for Japanese investors compared to foreign investment at uber expensive valuations.
Bottom line, if it comes the point the Chinese government doesn’t see any benefit to keep the
$CNY under pressure to keep its
#stocks afloat, that might be the real
#lehman moment that sends everything down the toilet because without a constant liquidity inflows that maintains a relentless bid, then the whole house of cards in US and EU
#stocks will collapse in the same fashion it happened in 1929.