After the financial markets were flooded with unprecedented waves of virtual accounting entries following the beginning of the Chinese influenza festival (where, by analogy, the actions taken following the rupture of the dotcom and real property bubble were nothing), this virtual waste paper began to be sucked first of all by the large technological piers known under the acronym FANG.
As a result, U.S. stock indices have become unprecedentedly flattened, being increasingly maintained only by these fewer companies, whose capitalization was consistently bloated by large banks and investment funds attached to a Fed drip. In fresh times, these indexes have become flat, as only N, or Nvidia, (replaced under this letter Netflix, was left of the supporting FANG.)
But Nvidia, of course, is not a balloon that can be inflated indefinitely – despite the constant media trajkot about the "artificial-intelligent revolution" – as evidenced by the fact that after yesterday's "phenomenally good" quarter, she graduated from almost +7% at the beginning to almost zero at the closing. In another words, after a fewer quarters of usage of the diverging “liquidity” to force the rumors to be pumped up, the time yet came for the news to be sold rapidly. Yet another "liquid orgy" is not going to happen, due to the fact that this time even central bankers seem to be aware of the constant threat of advanced inflation.
Of course, 1 can besides mention in this context the double highest indexed or that 1 of the biggest beneficiaries of the rupture of the real property bubble has late placed almost all of its portfolio (more than $1.5 billion) on the close melting of the current bubble, but let's leave the plotted and celebrity issues on the side. Anyway, it looks like we've run out of gas to pump all the components of FANG, and its fresh supply is not expected. In another words, all common sense seems to propose that after 3 years of wandering in and out of the air stairs, it is time for a gravitational elevator down. This, on the another hand, may have repercussions for the real economy in our central banking in reality, is simply a subject for a completely different discussion.
Jakub Bożydar Wiśniewski
