The market is printing -2% on good employment number from the USA and the VIX is only 8% up.
Is there something that Volatility is not considering?
Market’s Reaction To The Employment Data
The market’s reaction to the employment data is bearish. The employment data shows that the economy is strong. The negative knee jerk reaction is because the market does not like a strong economy. They would rather have a weak economy and the Fed launch another QE.
In our analysis, the market is like a spoiled kid throwing a tantrum. The reality is that the U. S. economy does not need more QE and can withstand another 0.25% rate increase. Some of the emerging economies such as India are in good shape. China is likely to be able to impose capital controls and contain the situation of fund flows out of China. Europe and Japan can muddle along.
Teddy Roosevelt M