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    Volatility Reports 1/8/24

    January 7, 2024

January 7, 2024

Volatility Reports 1/8/24

Here is cookie cutter stuff from the bullish public stream:

“We believe inflows to money market funds reflect an immense amount of apathy towards equities. 24% Y/Y growth for the industry’s most pedestrian funds. Said another way, cash is comforting, but opportunity cost remains a real threat.”

For one, its defense first, always. That is sound risk and money management. Its not take a risk, else you will miss a potential opportunity. Today as a contrarian I am running with this herd into safety.

And with investable cash avoiding risk. As a side note, you can be 90% in two year and trade with 10% in leveraged derivative’s and options and beat buy and hold on 100% of the account?  In any event, risk off is contrarian.

 

How you know nonsense when you hear it is hard to describe, to analyze that ability is to kill it, like bisecting a frog, ouch. Lets just call it intuition a sixth sense of a trained journalist. But the above chart tells the story of an increasing flow of funds into safe money from 2006 into 2009, right as the bull was topping.

The same thing here from the 2018 peak in the Dow to the recent jump in inflows. Give that the back story of the national and geo political tensions, there is front page reasons for people to be avoiding risk. Today they are beginning to see better returns, after a period of financial repression.

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