Markets Have Nothing Left to Fear But Fearlessness Itself
- Volatility gauges have collapsed as policy uncertainty spikes
- Machines, ETFs, central banks, ‘old normal’ among theories
U.S. Stocks Start the Week Mixed as the Dollar Waffles
This article is for subscribers only.
Greed seems to be running the show in global markets. Fear has fled, and that may be the biggest risk of all.
Currency volatility just hit a 20-month low, Treasury yields are in their narrowest half-year trading range since the 1970s and the U.S. equities fear gauge, the VIX, is stuck near a two-decade nadir. While markets have signaled complacency in the face of Middle East tensions, the withdrawal of Federal Reserve stimulus and President Donald Trump’s tweetstorms, the Bank for International Settlements flagged on Sunday that low volatility can spur risk-taking with the potential to unwind quickly.