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The Federal Reserve doesn’t care if market volatility has collapsed, even though volaltility is necessary for a well-functioning capital market. The VIX, volatility of the CBOE S&P 500 index, has declined to 13.5 as The Fed continues to slow M2 Money growth. And with M2 money withrawal, so goes bank deposits. Is Jerome Powell actually Uncle Limelight?

The gap between the VIX Put-call volume and CBOE Put-call ratio is the widest since 2006, the precursor of a major volatility spike. Meanwhile, for those of you interest in railroad regulatory issues, as a general matter, regulations are rarely ever “reversed,:” but rather modified or replaced with changes. No administration would be able to outright “repeal” a major safety regulation because it almost certainly be immediately enjoined by a court and found to be counter to Congressional delegation. I assume most of the attention will be on this final rule (https://www.federalregister.gov/documents/2020/10/07/2020-18339/rail-integrity-and-track-safety-standards) published and effective on Oct 7, 2020. It...

Central bank actions have for the most part suppressed market volatility since the financial crisis of 2008. This is part of a deliberate strategy to lower risk, which is measured by volatility. Reduced risk, it’s hoped, will facilitate borrowing to boost growth. Yet these measures have failed in their primary objective, instead encouraging speculation — which now exerts significant influence over markets and prices. Artificially low volatility has driven a wide range of investment strategies which generate small returns under stable conditions but are vulnerable to large losses under stressful conditions. Depending on how it is measured, an amount of...

You know that the oil markets have truly gone to the dogs when they are suddenly riskier than one of the world’s most volatile commodities: bitcoin.

Woke up this morning and saw the futures were a lot lower. Of course, yesterday they had a record rally. The day before, a record drop. It’s called volatility. I have a couple of observations as an old time trader. I just wish I was on the top step to take advantage of it. The other day I said to “Buy Em” on Twitter. Logically I think fears of a government shutdown and totally overblown. The press hates Trump and you have to figure that any news they report goes through that filter. Any news. Heck, they gave his wife...

Stocks rose sharply in volatile trading on Wednesday as surges in retail and energy shares helped Wall Street regain the steep losses suffered in the previous session. The Dow Jones Industrial Average traded 657 points higher as of 3:05 p.m. ET, while the S&P 500 gained 3.05 percent. The Nasdaq Composite outperformed, rising 3.96 percent. Both the S&P 500 and Nasdaq were on track for their biggest one-day gains since Aug. 26, 2015 and erased Monday's losses. The Dow also recovered all of its losses from Monday.

The Dow Jones Industrial Average traded higher on Thursday, erasing steep losses a day after posting a historic surge. The 30-stock index traded 31 points higher after plunging 611 points earlier in the day. The S&P 500 held just above the flatline after sliding more than 2 percent. The Nasdaq Composite traded 0.2 percent lower after dropping more than 3 percent. Earlier in the day, stocks fell amid renewed tensions between China and the United States.

As Wall Street’s ‘fear gauge’ nears all-time lows, one commonly used measure shows Asian equities near their least volatile this century. The calm that has descended on U.S. financial markets is stretching around the world. Based on one commonly used measure, Asian equities are near their least volatile this century—a byproduct of improving corporate earnings, stabilizing economic growth and the diminishing impact of geopolitical events on markets. In the U.S., Wall Street’s “fear gauge” is near all-time lows, and in Europe, volatility has also largely subsided.

In November 2014 the OPEC countries met in Vienna and agreed to keep pumping oil to maintain their market share rather than cut production to support the oil price. In a post written a month later I addressed the question of how these countries were positioned to withstand an extended period of low oil prices and high budget deficits. More than a year has now passed, so it's time to take a look at how they have done so far and to see what their actions presage for the future. Results to date: OPEC is known to have suffered economic...

Everyone knows that oil prices have crashed, and that has opened up a variety of avenues for investors to play the market. Some may have been burned by staying long on the energy sector, others have tried to pick the bottom. Other investors have found ETFs that track the price of WTI, or ETFs that trade inversely to oil prices, which amount to bets that prices will fall further. In these uncertain times, one strategy would be to bet not on oil prices rising or falling, but simply bet on oil price volatility. If that was your strategy, you probably...

Oil prices have posted their strongest rally in years, jumping an astounding 27 percent in the last three trading days of August. While much of the recent price movement defies reason and is enormously magnified by speculative movements by traders to take and cover their bets on oil, still, there were a series of rumors, events, and fresh data that helped contribute to the spike. For example, on August 31, the oil markets woke up to the news that Russian President Vladimir Putin will meet his counterpart from Venezuela to discuss “possible mutual steps” to stabilize oil prices. The meeting...

[ Secondary blog source: Tyler Durden / The Zero Hedge / www.zerohedge.com/news/2014-12-24/we-live-new-world-and-saudis-are-first-get-it ] There are many things I don’t understand these days, and some are undoubtedly due to the limits of my brain power. But at the same time some are not. I’m the kind of person who can no longer believe that anyone would get excited over a 5% American GDP growth number. Not even with any other details thrown in, just simply a print like that. It’s so completely out of left field and out of proportion that you would think by now at least a few more...

The debacle ignited by the Federal Reserve this week invites this question: What would have happened had Chairman Bernanke refrained from saying anything? He held on Wednesday one of his press conferences, announcing that, as the Associated Press put it, the Fed would likely slow its $85 billion-a-month program later this year and end it next year if the economy continued to strengthen. The stock market collapsed, and the value of the dollar soared — to more than a 1,300th of an ounce of gold at last check — and alarm is spreading. Well, let it not be said that...

A single algorithm which placed and then cancelled orders on the Nasdaq accounted for 4% of all quoted traffic in the US with no clear goal. An investor gives FRANCE 24 his insight into the mystery which has concerned market watchers. A single mammoth mystery algorithm has set alarm bells ringing for market regulators and players, and underlined the market’s vulnerability to technology and the woeful lack of regulation on algorithms. A single algorithm last week placed and cancelled orders on the Nasdaq accounting for 4% of all quoted traffic in the US. Not only this, it also accounted for...

A note by JP Morgan released today contains the following gem: "The quite frankly frightening volatility in the Italian bond market this week together with the rapid pace of political developments (nascent new governments in Greece and Italy) confirms not only a new, more extreme phase in the European crisis, one in which the very irrevocability of the euro is now up for discussion, but also the disconnect that now exists with the currency markets. Yes EUR/USD dropped but the worst daily decline was a 3-sigma move compared to the 10 sigma surge in BTP yields Wednesday followed by the...

The U.S. dollar may weaken and Treasury yields rise when Asian markets reopen on Monday, though any selling in response to ratings agency S&P's downgrade of the United States is likely to be tempered by the escalating crisis in the euro zone. The S&P cut in the U.S. long-term credit rating by a notch to AA-plus is an unprecedented blow and results from concerns about the nation's budget deficits and climbing debt burden. It called the outlook "negative," signaling another downgrade is possible in the next 12 to 18 months. "The initial reaction will be a high degree of uncertainty...

Do sovereign debt ratios matter? Jul 20th, 2010 by Michael Pettis Posted in Balance sheets, Banks, Financial crisis, History In the past few weeks I have been getting a lot of questions about serial sovereign defaults and how to predict which countries will or won’t suspend debt payments or otherwise get into trouble. The most common question is whether or not there is a threshold of debt (measured, say, against total GDP) above which we need to start worrying. Perhaps because I started my career in 1987 trading defaulted and restructured bank loans during the LDC Crisis, I have spent...

Stocks fell sharply Thursday after an unexpected spike in jobless claims and as global jitters pushed the dollar higher. -snip- The Dow Jones Industrial Average was down nearly 300 points, or almost 3 percent, and the CBOE volatility index, widely considered the best gauge of fear in the market, spiked more than 20 percent to above 43, its highest level in over a year.

Week Ahead: Volatility, the Fed and Plenty of Economic Data Published: Sunday, 1 Nov 2009 | 10:25 AM ET Text Size By: Patti Domm Executive Editor Brace for more volatility in the week ahead as investors wrestle with dual concerns that stocks have gotten too pricey and that the economic recovery is just too uncertain. Stocks start November on wobbly footing, after the past week's selling helped erase October's gains and pushed the S&P 500 to its first monthly loss since March. The Dow fell 2.6 percent for the week, finishing at 9712 but it was a half percent higher...

Oct. 31, 2009, 12:01 a.m. EDT Not for the faint of heart As volatility returns, investors face Fed, employment, and earnings By Laura Mandaro, MarketWatch SAN FRANCISCO (MarketWatch) -- Already reeling from huge market swings, stock investors may get that whipsawed feeling again next week, when the Federal Reserve and the monthly jobs report headline a busy schedule. The broad market, coming off weekly and monthly losses, also faces monthly auto sales; quarterly results from Ford Motor Co. (NYSE:F) , Cisco Systems Inc. (NASDAQ:CSCO) and Time Warner (NYSE:TWX) ; and Congressional votes on healthcare, financial regulation and homebuyers' tax credits....