MarketSurge powers the charts in this video.
It is said that we should pay the most attention to seasonality when it doesn’t follow the expected path, because it would not be priced in. This is exactly what has been happening in August so far. Historically, US stocks lose ground in August and September in the second year after the Presidential elections. Not this time around; at least, not so far. There are enough other catalysts to change the projected trajectory.
The Fed’s chairman hinted that they might be ready to begin rate cuts. The market loved the message. Small caps gained 4%. Crypto, homebuilders, and China were also among the best performers. The US Dollar was the biggest loser.
In the meantime, we are in the midst of the biggest deregulation of the financial industry in decades, which allows banks to use more leverage and regular investors to have access to more asset classes. It is an environment primed for degenerate speculation.
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