Some VERY Smart People Who Manage Billions Are Preparing For a BREXIT-Type Event
The “smart money” is flashing a signal that the US economy and ultimately the financial system, are in serious trouble.
CNBC and other media outlets like to focus on stocks because they tend to be more volatile and therefore more exciting. But BONDS are the “smart money” for the financial system.
The Bond market is larger, more liquid and involves more sophisticated investors than stocks. As such it usually picks up on major issues much earlier.
On that note, the Bond market yield curve is flattening rapidly. It has already broken through the election night lows and is now approaching the BREXIT lows.
What does this mean?
That the “smart money” is more nervous today, than it has been since the UK LEFT THE EU.
If you don’t remember what happened in the week that followed BREXIT, many EU banks were limit down losing 15%-20% in a matter of days.
The bond market is sensing that kind of issue right now.
Some VERY smart people, who manage VERY LARGE amounts of money, are positioning for an “event” like BREXIT… and stocks are completely clueless.
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Graham Summers
Chief Market Strategist
Phoenix Capital Research