Every bubble must pop some time. And since GFC 1 the powers that be have been blowing up massive asset price bubbles all over the world. Now it looks like a reversion to mean in the global markets might be on the cards and be truly vertiginous. If the world central banks are out of QE bullets as the buyer of last resort (long gone are the idea of “free markets” in the financial system), things are going to get very messy in the crony capitalist world over the next 2-3 months.
Remember, true financial market crashes don’t happen in a couple of days or even a couple of weeks. The kinds of massive greed driven imbalances which have built up tend to unwind over much longer periods of time: many months, or longer. But day to day movements can be horrifically volatile.
Meanwhile ZeroHedge suggests that the real global economy is currently falling through the floor, as evidenced by massive declines in global container freight rates.
I like the article heading on MarketWatch: “How market carnage is only going to get worse: in 4 charts.”
Depositor bail-ins, anyone?