Key insights
- The author expresses concern about the current market dip and questions where the money pulled from equities is flowing, noting it doesn't appear to be going into traditional safe havens like bonds. They also believe October oil futures are overvalued, suggesting potential geopolitical risk is being priced in. The author acknowledges misinterpreting market data, clarifying it's a market value decrease rather than a massive sell-off, but maintains a bearish outlook on oil futures.
The way I understand it, people pull money out of the markets and put it elsewhere like bonds or something stable. This has happened in every market dip or crash so far.
This one doesn't have that, people are pulling money out of the market but where is all that cash going? And more importantly, do people actually thing this conflict will last? Oil futures for Oct is close to touching 85, wtf is even happening here?
Now I don't have the balls to short futures, but those prices look ridiculous. I buy stocks without margin and chill but my net loss is in the mid 5 figs and that's irritating af cuz I wanted to buy a car this year.
Tldr, 2 questions,
If money is pulled out of the market, where is it going? It's definitely not bonds or anything stable.
Do people actually believe this issue and its effects will be significant till the Oct future expires??
Edit:
MB, I used Gemini to look up the numbers and I misinterpreted total buy - total sell was 4 trillion. That's not the case tho, few people sold and few people are trading while most of us are sitting on losses. I feel like an idiot for not seeing that it's a 7 % fall in market value and not a sell off, a 7% sell off would have led to a far worse fall.
That being said, I still believe Oct oil futures being at 85 is ridiculous.