June 2022 - Stocks, Crypto & Interest Rates

[shri]

Following up on June developments to these threads:

May Interest Rate Hikes and Effects on Stocks
https://geoexpat.com/forum/155/thread363554.html

May 2022 Crypto Drama (Seemed like an opening act for June)
https://geoexpat.com/forum/155/thread363593.html

May 0.5% interest rate hike
https://geoexpat.com/forum/155/thread363453.html

BTC-USD @ 21Kish following all sorts of meltdowns (and I have no clue what half the terms used by the bros or what 90% of the companies, coins and other buggery involved means).

Bitcoin plunged to an 18-month low, falling below $23,000. The most valuable cryptocurrency tumbled by 15% in the past 24 hours, while ethereum, which is second to bitcoin, fell 17%.

https://www.cnbc.com/2022/06/14/cryp...reum-fall.html

Interest Rate Hike on Wednesday - expected @ 0.75% - priced in or not, it should be interesting to see how the markets react. Quite a few banks / analysts betting that 0.75 is the new 0.5% and 1% might be the new 0.75%

JPMorgan Chase & Co. economists said they expect the Federal Reserve to raise interest rates by 75 basis points at their meeting on Wednesday after a survey showed Americans’ inflation expectations rising.

An increase of 100 basis points is also “a non-trivial risk,” chief US economist Michael Feroli said in a note Monday.

https://finance.yahoo.com/news/jpmor...203611091.html

S&P 500 goes bearish... but looks like there will be a decent enough bear market rally in the very near short term

Three weeks ago, Wall Street narrowly escaped a bear market, with stocks rebounding at the last minute from a brutal drop that had brought the S&P 500 down 20 percent from a record high in January. The next few weeks offered a glimmer of hope that the worst of the losses might be over.

That glimmer is now gone.

On Monday, the S&P fell 3.9 percent, closing the day nearly 22 percent below its Jan. 3 peak and firmly in a bear market — a rare and grim marker of investors’ growing concerns for the economy.

https://www.nytimes.com/live/2022/06...ks-bear-market

( Mark Six @ 28M tonight! )

[shri]

Not on the list of things I was expecting to see in today's financial news.

Shares in Hybe, the South Korean entertainment and talent agency behind global pop superstars BTS, sank on Wednesday after the seven-member boy band said they were taking a hiatus as a group to pursue solo projects.

Hybe shares dropped 26.4 per cent on Wednesday morning, underperforming a 1.2 per cent fall on the country’s benchmark Kospi. Uncertainty over the group’s future has grown, with some members facing the prospect of military conscriptions in the coming years.

[bdw]

USDD is supposed to be pegged to the USD isn't it? It looks fucked....

[ByeByeEngland]

Crypto falling apart? Surely not it’s a robust instrument and we will all be using it soon

[shri]

Grave dancing when there is wealth destruction should be left to two special GeoExpat members..

[Gollygordon]

Crypto falling apart? Surely not it’s a robust instrument and we will all be using it soon

Someone said 'what can I short' in the other thread and I alluded to this very asset, which is based on the failed UST and somewhat resembles a ponzi scheme. 'Crypto' isn't falling apart, this asset has lost its peg.

[Elefant&Castle]

So much for inflation hedge - or for coinbase being more stable than crypto itself.

Last week, an anonymous employee petition called for the removal of three senior Coinbase executives for the failure of several product launches, overseeing a toxic work culture and aggressively hiring for thousands of roles, “despite the fact that it is an unsustainable plan”.

CEO Armstrong...

Armstrong called the petition “really dumb on multiple levels”, and invited unhappy employees to “quit and find a company to work at that you believe in”.

https://www.ft.com/content/0f959336-...2-55710e71ae58

[Gollygordon]

Coinbase coming out of this downtrend looking borderline incompetent. Reports of massive job offer retractions, even for candidates who had resigned from prior workplaces to accept CB roles. They have been listing every shitcoin under the sun, all sorts of crap that even people following the space daily have never heard of.

Their short termism seems to have ramped up post IPO. Coincidence? Think not.

FTX and Binance looking great by comparison.

[Gollygordon]

So much for inflation hedge - or for coinbase being more stable than crypto itself.

Somewhat tongue in cheek, but the inflation hedge narrative started blowing up in the summer of 2020 when supply chain shocks and demand spikes were pretty evidently on the horizon and the likes of Ray Dalio and Stanley Druckenmiller were becoming more vocal about seeing BTC as gold substitute. Those who followed their lead anytime around then can now consider themselves comfortably hedged against the inflationary pressures we've experienced over the time since.

[Gollygordon]

For the trolls lolling at crypto prices but still holding real estate and stocks. How will you feel if crypto is simply flashing a warning that the all asset bubble brewing since 2009 has simply popped? The canary in the coalmine, if you will? Smaller market cap, higher beta, leading indicator. A more rapid deleveraging and a more rapid reversion to the mean, but mechanically and sentimentally more closely aligned to traditional financial markets than many have admitted to themselves yet.

Anyway, my portfolio remains extremely heavily positioned towards that outcome. My upside hedges are rekt, but my overall thesis is gathering pace.