Markets took a shit today with the S&P 500 closing down 1.83%, while the Nasdaq closed down 1.57%. The 10 year also ended the day at 2.04%. I'm not a big watcher of financial TV, so I don't know what they are panicking about these days, but I would guess that domestic markets were impacted by big down days across Europe as there are renewed fears that Greece is going to leave the Eurozone. CAC 40 was down 3.31%, DAX was down 2.99%, and Euro STOXX 50 was down 3.70%!
It probably doesn't help that crude oil also tanked some 5%+, closing below $50 at $49.88 on reports that Russia continues to pump record amounts of crude and that Iraq is exporting the most oil since 1980. These pieces of oil news are adding to oversupply fears. I wonder every day about when more people are going to start talking about demand fears, which could send prices even lower. Not completely related, but one of my colleagues always likes to talk about how oil was one of the leading-most indicators of the Great Recession.
As opposed to 2014 I'm also seeing some of the more bullish sell-side shops start to become more cautious, which is a little bit worrisome. I'm not so worried about the US economy as it currently stands, but problems in Europe and Japan could spill over very quickly given the increasingly interconnected world we currently live in. Europe really needs to do some sort of QE, but I don't think it's possible for them to do something like the US has done. At the same time, the idea that they are trying to do something similar could be all Draghi needs. Time will tell.
Those are just some of the things I'm thinking about on this cold, snowy Cleveland evening...
It probably doesn't help that crude oil also tanked some 5%+, closing below $50 at $49.88 on reports that Russia continues to pump record amounts of crude and that Iraq is exporting the most oil since 1980. These pieces of oil news are adding to oversupply fears. I wonder every day about when more people are going to start talking about demand fears, which could send prices even lower. Not completely related, but one of my colleagues always likes to talk about how oil was one of the leading-most indicators of the Great Recession.
As opposed to 2014 I'm also seeing some of the more bullish sell-side shops start to become more cautious, which is a little bit worrisome. I'm not so worried about the US economy as it currently stands, but problems in Europe and Japan could spill over very quickly given the increasingly interconnected world we currently live in. Europe really needs to do some sort of QE, but I don't think it's possible for them to do something like the US has done. At the same time, the idea that they are trying to do something similar could be all Draghi needs. Time will tell.
Those are just some of the things I'm thinking about on this cold, snowy Cleveland evening...