The bear market rally in equities hit a speed bump today but the reality of what is happening in our economy can no longer be masked. The warnings from Jamie Dimon about the banks, the layoffs by companies where even Apple started firing people, and the dysfunction in DC is causing everyone and every major corporation to prepare for a hard landing in the near future.
The bond market has been gyrating like a super ball wrapped in a straight jacket in a rubber room with volatility spiking to levels last seen in 2008 as highlighted by Jim Bianco in his Twitter feed today:
The MOVE index measures bond market volatility, much like the VIX in the stock market. The MOVE is derived from the implied volatility of 1-month options with maturities from the 2-year to the 30-year.— Jim Bianco biancoresearch.eth (@biancoresearch) April 4, 2023
The chart below highlights the long-term average of the MOVE (91.5) and a one… pic.twitter.com/owu43veFEw
Meanwhile the 2s-10s spread continues to warn of a hard landing while flirting with a rapid acceleration from a 50bps spread to zero without any warning.
The action in the 2 year US Treasury on its own indicates major instability and appears to flash a warning sign that bad events are on the horizon:
Despite all of the action today, equities did not provide the warning many are hearing where the smart money resides. Bonds are telling everyone that a prolonged period of economic instability is on the horizon, especially if foreign buyers abandon their participation in US government and corporate paper.
The big screaming flashing red danger signal however came from gold today:
The precise quote from the author Earl Nightingale is:
Wherever there is danger, there lurks opportunity; whenever there is opportunity, there lurks danger. The two are inseparable. They go together.via AZ QUOTES
The action in gold today indicates both.
There is great danger ahead in the American and perhaps the entire Western economic system along with one more opportunity to save your families from what is to come. If gold costs too much, think about acquiring silver. If silver costs too much, get food, water, and protection.
There is a storm coming and over 90% of America is totally unprepared for it. Especially when gold trades above $2300 later on this year.