Market Thoughts - 06/13/2022
Market Thoughts - 06/13/2022
Hello Investors,
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I wanted to shoot you a little update on some market trends and news that caught my eye. Keep in mind these are subject to change every day. The financial markets are very over-reactive. Any slight news can destroy the thoughts here.
Market Recap
Hope you all are still with us, that was a wild week in the financial markets.
If you missed it, the markets were feeling effects from the Federal Reserve Quantitative tightening. The QT began on June 1st. QT and rising interest rates gave hope that inflation was at it’s peak. Then came the CPI statistics on Friday.
The CPI statistics came in with an 8.6% inflation rate, the highest since 1981.
This was not expected, as the financial markets thought the Fed had a grip on inflation. Stocks tumbled and treasury yields climb after this news on Friday.
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Week Ahead
On Tuesday, the FOMC begins meetings on interest rate hikes. After the inflation report, can we expect The Fed to get more aggressive with interest rate hikes? The Bank of England just gave a 75BPS hike this morning.
Futures are bloody, with VIX up 9%.
Global financial markets are in turmoil. This isn’t just an American performance.
There are no notable earnings this week.
Crypto
While The Fed started the process of QT, crypto has been deemed a high risk assets in the eyes of the free market.
When you have a high risk asset, treasury yields rising, and QT, you should expect a major sell off. QT simply means “it’s harder to get money”. You can associate QT with interest rates rising.
When it’s harder to get money, people go into lower risks assets.
The Ethereum Merge went very well as they merged their Proof of stake code onto a new test net. They found minimal bugs, which are are addressing.
The biggest news coming out is the Celsius story of their ETH being illiquid and the company facing liquidation multiple ways.
I sounded the alarm a few days ago as well:
Be careful if you are in any CeFi places right now. The bear market is cleansing fake/ponzinomics projects.
Not your keys, not your coins.
Latest News
Americans feel the heat as U.S. annual inflation posts largest gain since 1981. Read More
UK plans to probe Apple, Google's mobile browser dominance. Read More
Crypto’s Total Market Cap Slips Below $1 Trillion as Bitcoin Drops Under $24,000. Read More
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