Last time the Fed started raising interest rates and people were freaking out saying the stock market was about to crash was 2015. Yours truly lost a decent chunk of change on SPY puts at that time, so I remember it clearly. As the chart shows, the market did not crash, it rallied. The main difference between now and then is there is inflation and a new set of geopolitical concerns.
M2 money supply is way up and M1 has been redefined completely so I didn’t bother to include it. M2 velocity is way down which can, to the best of my knowledge, help offset the effects of inflation or reduce it, but I only LARP as an economist on my free time so don’t quote me on that. Most of us and probably most economists don’t understand how everything ties together so while people may freak out from time to time and have logical reasons for doing so, sound logic doesn’t always prevail in systems as complicated as the financial markets. I’m not saying to go long, but I’m putting this idea out there because it’s something to keep in mind before taking out a 2nd mortgage on your house to buy $100 strike Sept 2022 expiration SPY puts in order to become a multi-quadrillionaire.
People may criticize the trend line and say its nonsense. There were plenty of bears claiming it was resistance in the past, and it did serve as resistance, so they were right, as the chart clearly shows. Well, it’s been broken through to the upside and it’s now serving as support again like it did in 2015-2018, in Feb/March 2020, and again in Feb 2022.
M2 money supply is way up and M1 has been redefined completely so I didn’t bother to include it. M2 velocity is way down which can, to the best of my knowledge, help offset the effects of inflation or reduce it, but I only LARP as an economist on my free time so don’t quote me on that. Most of us and probably most economists don’t understand how everything ties together so while people may freak out from time to time and have logical reasons for doing so, sound logic doesn’t always prevail in systems as complicated as the financial markets. I’m not saying to go long, but I’m putting this idea out there because it’s something to keep in mind before taking out a 2nd mortgage on your house to buy $100 strike Sept 2022 expiration SPY puts in order to become a multi-quadrillionaire.
People may criticize the trend line and say its nonsense. There were plenty of bears claiming it was resistance in the past, and it did serve as resistance, so they were right, as the chart clearly shows. Well, it’s been broken through to the upside and it’s now serving as support again like it did in 2015-2018, in Feb/March 2020, and again in Feb 2022.
