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🌞 Good morning folks.
The absolute avalanche of Credit Suisse news is a distraction— only half kidding.
Investors are looking for safe havens to ride out the uncertainty across the
US <> Global Financial System
e.g. Gold, Yen, Oil, Blue-Chip Stocks. That's why we saw these assets (+US equity markets) in the green yesterday.
Let’s jump in, ignore the algos 🤾♀️🕳️
👁️ What's got our attention:
⦿ US + EU stocks ended higher yesterday after a deal to rescue Credit Suisse and central bank efforts boosted confidence in the global financial system
⦿ Oil prices rose over 1% after hitting their lowest level since December 2021
⦿ Japanese yen rose yesterday as investors sought a safe haven amid banking uncertainty
⦿ Dollar dropped 0.5% to its lowest level since mid-February
⦿ Federal Reserve Chair Jerome Powell will make a decision on US interest rates tomorrow
Why? 🤷♂️
Markets are like organisms, when you pinch one nerve it moves or reacts in another part of the body. The banking crisis, Credit Suisse failing overseas, inflation fears, cryptocurrency policy-- it's all connected.
Yesterday's market reaction (overall positive) reflected a consensus to sell cash and buy risk assets (e.g. stocks, Bitcoin, Gold, Oil).
Why would someone prefer these things versus cash?
🌍 Non-USD liquidity (e.g. Japanese Yen, Gold, Oil-- ability to sell easily and retain value without being cash)
🏦 Not married to a bank (e.g. stocks, bonds-- less custody fears if assets aren't bank deposits)
👹 Fear surrounding the value of the US dollar amid the banking crisis and Fed activity (USD fell .5% yesterday alone, that's a lot for a currency in one day).
🎰 Speculation that Jerome Powell will cut rates or pause interest rate rises to support the financial system. If rates are paused or lowered this is tremendously good for risk assets like technology stocks, cryptocurrencies, bonds even.
Chart(s) Du Jour 👨🏻🍳
Meme Digestif ☕️
Shout out to our friend @nolitadirtbag
Have a wonderful day, and keep your head on a swivel make sure your savings are not in a suspect regional bank 👋
