The First of May...
Technology has continued its run... showing that the market is completely detached from the underlying economy.
Good morning:
Hooray… hooray… the first of May…
This will be a pretty active day in the markets.
Tesla stock is sliding after news broke that they had started a new CEO search to replace Elon Musk. Microsoft proved resilient… McDonald’s traffic has been dropping… Meta proved that you can lose billions on a worthless technology, and the stock market will still like you…
Liquidity. Yesterday, while doing my live show at TheoLive, I went on a long explanation of how the markets work (I’ll be live again in about 15 minutes). This week, Howell said global liquidity (capital in the system) reached a new all-time high. It’s up over $5.5 trillion YTD, aided by improving collateral values and lowering bond volatility.
Here’s the key: Liquidity impacts risk assets and cryptocurrencies with a three-month lag. After Q1, investors increase their exposure to risk assets as Bitcoin prices recover. As we have said, this year will likely see a peak in global liquidity, setting up for challeng…
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