Infinite QE

Tale of the Tape

Good evening, folks. 

Today saw a mild sell-off relative to the recent price cascades we’ve experienced almost daily as of late. The S&P 500 only fell 2.93%.

If this would have happened a few months ago, we’d have been screaming murder but today this is almost a win.

Funny how price changes our perspective on things and how we attenuate to volatility.

This morning, the Fed unleashed the QE equivalent of the Caesars All You Can Eat Bacchanal Buffet in Las Vegas, Nevada or at least what that used to be before the global plague. See more below.

Stocks rallied on the Fed announcement but gave it up. There’s just no bid.

Energy and financials were conspicuous laggards yet again both falling more than 6%. Financials are now down 39% year to date which is disturbing any way you slice it. In fact, Bank of America is this close to being 50% down year to date. 

The VIX fell 7% today which is unusual given the fall in stocks. As we mentioned above, maybe we’re attenuating to the volatility.

S&P 5002,237-2.93%
Russell 20001,002-1.13%
Dow Jones18,591-3.04%

Infinite QE

Prior to today’s open, the Fed announced numerous plans to aid the economy while we attempt to “flatten the curve”.

Here’s the money quote from the Wall Street Journal:

Among the actions announced Monday, the Fed said that the purchases of Treasury and mortgage securities that it approved one week ago are essentially unlimited and that it would buy $375 billion in Treasury securities and $250 billion in mortgage securities this week.

By point of comparison, the Fed will buy more government-backed debt this week than it did during a controversial round of asset purchases, called quantitative easing or QE, that it undertook between November 2010 and June 2011, when it bought $600 billion in securities.

Olympics Postponed

It’s official, the 2020 Tokyo Olympics have been postponed. ☹️

Here is what International Olympic Committee member Dick Pound had to say,

On the basis of the information the IOC has, postponement has been decided. The parameters going forward have not been determined, but the Games are not going to start on July 24, that much I know.

Here’s USA Today with more.

Production is Halted

Boeing was halted this morning prior to news being reported that the company would suspend production at its Puget Sound facilities. The suspension is expected to last 2 weeks, but who knows. Boeing’s stock has lost 53% in the last 2 weeks, anything can happen. Following the halt, $BA gained 6%, closing up 11% for the day. 

NYSE Floor Ringing, Surreal 

The Opening Bell rang this morning despite no traders working on the floor. This is a strange sight.

Today on Stocktwits…

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