A very difficult period for banks. BTC is less volatile than stocks

The Dow has already advanced for the second time in a row on a weekly basis, but this is not a very realistic picture of what is happening on the New York stock exchanges. The broader S&P 500 has lost 1.6 percent in the past five days, while the tech Nasdaq has lost more than three percent. Once again, the inflation announcement in September caused a lot of tension. It was 8.2 percent, just down from a month earlier, but what if core inflation (which doesn’t take food and energy prices into account) rose to 6.6 percent. Inflation expectations, measured in a survey by the University of Michigan, rose (for the first time since March) by 0.4 percentage points. The average American currently expects US inflation to reach 5.1% in 12 months. The Fed will not ignore this and everything that indicates that it will raise interest rates by 75 basis points not only at the November meeting, but also at the December meeting.

Morgan Stanley profits fall 30%
Meanwhile, the US quarterly earnings season has already begun. Analysts expect earnings to be only 3.6 percent higher than the corresponding period last year. First, the results were announced by the largest banks. Morgan Stanley says it’s been one of the most challenging neighborhoods in 15 years. Because of the challenging investment banking environment, the bank posted a profit of $2.6 billion, nearly 30 percent less than the same quarter last year. Shares fell five percent on Friday, more than peer banks, which have a higher share of common stock (« selling by piecesBanking firms such as JPMorgan Chase and Wells Fargo. Morgan Stanley is down 23 percent this year, and JPMorgan (third-quarter net profit fell 17 percent, but beat expectations) is down 30 percent.

Is there another « black swan » to be afraid of?
Jamie Dimon of JPMorgan Chase warned investors to prepare for more turmoil in light of what is happening with UK government bonds. After the new British government announced tax cuts and programs to solve the energy crisis in September, British bond prices fell sharply (and the required yield rose sharply as a result), shaking British pension funds operating according to the LDS strategy (Commitment-driven investments), through which they ensure adequate liquidity to cover the necessary payments. As the money received more and more calls (margin call)To further hedge their positions, this triggered additional bond selling and forced the Bank of England to act, as it was already a systemic risk. « My experience shows that with such events we can expect some negative surprises,Damon is afraid.

Bitcoin’s Surprisingly Low Volatility
There was no bread in the cryptocurrency market last week either, but the losses were mostly not huge. Bitcoin – which is worth just over $19,000 – hasn’t moved away from the $20,000 mark by more than 10 percent for two months. Recently, it has become less volatile than stocks, which – with low turnover – is not a good sign. Speculators who want to catch the local bottom and sell less and less after the local top in such an environment. In addition, cryptocurrencies are still affected by the same forces as other investments, i.e. mainly expectations of further tightening of monetary policy. With the announcement of high inflation in September, Bitcoin couldn’t shake off the negative signal on Thursday.

Six months of Euribor higher than two percent
It’s pretty clear this year that neither bitcoin nor gold (currently just a good percentage above its 19-month low of $1,621 on Sept. 2) are neither inflation-proofing investments, but traders are putting the fear of higher interest rates ahead. It also halted this boom in the real estate market in both the United States and Europe. In the United States, the 30-year mortgage rate is seven percent, the highest since 2002. Just a year ago, the interest rate was just over three percent. The Euribor rate is also steadily increasing, the six-month rate is already above 2%, which of course brings higher monthly repayments to everyone who has variable rate loans.