Key insights
- Ultra-wealthy investors are reducing equity exposure, offloading over $1 billion in recent weeks. This deleveraging signals potential headwinds for US equities, driven by concerns over unpriced physical oil scarcity, stalled peace negotiations, murky corporate earnings guidance due to energy costs, and a structurally weaker 'Fed put' amid fiscal dominance and rising term premiums. While not a definitive market top, the move suggests increasing risk perception among sophisticated investors.
This from Bloomberg on 5/28 - thoughts? - ‘Members of the world’s super-rich are electing to take cash off the table as stocks repeatedly test new highs, offloading more than $1 billion of shares in recent weeks.’ Not saying its the top but they usually know before retail - that the August/September physical oil scarcity cliff is not priced into equities, they see the peace negotions are stalled and recognize mango is not going to solve this before sept. They also see that corporate earnings are still holding but forward guidance is getting murky under sustained energy cost pressure and that the fiscal dominance/term premium story means the “Fed put” is structurally weaker than prior cycles - not to mention bonds will go up next week (just look at ^move3m) not saying sell everything tomorrow but it is looking risky….