Stock Market Volatility Skyrockets Most In HISTORY

MarketWatch reports:

The CBOE Volatility Index jumped Friday to levels not seen since December 2011, logging its largest ever weekly percentage jump as stocks sold off for a fourth straight session. The VIX, or so called “fear index,” surged more than 47% to 28.21 right after the close. For the week, the index is up nearly 120%, making it the largest weekly percentage jump in the VIX’s history, according to FactSet data. The previous largest surge was back in early May 2010, when the VIX jumped nearly 86% on the week. For the week, the Dow Jones Industrial Average and S&P 500 Index both dropped 5.8%, and the Nasdaq Composite Index fell 6.8%.

CNBC notes:

The CBOE Volatility Index, known as the VIX, has doubled in August. If it finishes the month here, it would log the largest monthly gain ever (using data going back 1990). That beats out the 91 percent advance seen in September 2008.

Wikipedia explains:

VIX is … a popular measure of the implied volatility of S&P 500 index options. Often referred to as the fear index or the fear gauge, it represents one measure of the market’s expectation of stock market volatility over the next 30 day period.

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  • ClubToTheHead

    “The Fear Index” is a terrific novel by Robert Harris.

    Maybe too close to the coming future to be enjoyed by many.

  • Anyone Home?

    As I said before, I think everyone knows that this artificial market rally is getting long in the tooth. There isn’t any real earnings growth to support the absurd valuations on many of these stock prices. A lot of businesses are using non GAP statistics to collect earnings data, which essentially leaves room for the companies to fudge their earnings to make them look more solvent than they actually are.

    Blackrock came out and said that as much as 90% of earnings data in 2014 was calculated using this measure, which essentially means that this market is the most overvalued in history, filled with malinvestment due to the Fed’s policy of ZIRP, which subsequently fueled malinvestment in the oil sector. Now all those leveraged loans, taken out with massive amounts of debt, are most certainly going to blow up as oil heads to the low 30s to the 20s and may stay that way for a very long time.

    The resulting damage will be the complete bankruptcy of multinational oil companies and the death of the trillion-dollar junk bond market.

    I think people can’t even contemplate where we are headed. Contrary to the c
    ommon belief that the world will spiral into a sea of hyperinflation as governments try to inflate their way out of debt, what we will experience first, I believe, is a massive deflationary Depression, the likes of which we have never seen before.

    The reason QE has not produced the inflation expected is because the QE money never actually made it into the economy, instead it is sitting in bank reserves, collecting rolling interest. This has lead to a massive loss of velocity in the circulation of money. The Fed raising interest rates would put the final nail in the coffin, as the current rate of mortgage applications and auto loans are almost entirely based on zero percentage interest rates or subprime lending standards.

    Even a miniscule interest rate increase of 4% would cost US consumers 9 billion per year, as well as ensure the Federal government goes completely bankrupt in 5 to 10 years, as we would be paying trillions of dollars on the interest of the national debt alone. The resulting carnage may result in emerging markets dumping US Treasury bonds, an assured death of the petrodollar.

    Either way we look at it, the diagnosis is quite bleak. Best to be prepared and hope for the best.

  • jadan

    Can’t think of anyone who outdoes Michael Snyder documenting the financial debacle dead ahead. He has the undeviating conviction of a Millerite and the relentless zeal of a Moonie in an airport. If the globalization system does not fall apart this year, perhaps on 9/23, and we are not plunged into a jaw clenching deflation, Snyder will have a serious case of cognitive dissonance, along with all the preppers out there. Snyder’s essays are a tonic, if also monotonous. The problem is he has no solutions so far as I can tell. The collapse of globalization is a good thing, but only if it gives rise to a new system of public finance. Ellen Brown’s essay on this page shows the way out. The solution is easy to understand and very elegant. It is a fine antidote to fear and loathing….

  • May 5th, 2015 The QE Era

    I wanted to share this wonderful collection of charts from Jim Bianco of Bianco research:

    http://www.ritholtz.com/blog/2015/05/the-qe-era/

    http://www.ritholtz.com/blog/wp-content/uploads/2015/02/6.png

    08/18/2015 United States Drops In Overall Freedom Ranking

    A new report on the freedom of countries around the world ranks the United States 20th, putting countries like Chile and the United Kingdom ahead of the U.S. Last year, the U.S. was ranked 17th, but a steady decline of economic freedom and “rule of law” has dropped the level of freedom, according to the Cato Institute, Fraser Institute and the Swiss Liberales Institut, which created the study together.

    http://dailycaller.com/2015/08/18/united-states-drops-in-overall-freedom-ranking/#ixzz3jUF5BFrU

  • Here are the gangsters on video and out of their own mouths for those who may be very young.

    How The Democrats Caused The Financial Crisis: Starring Bill Clinton’s HUD Secretary Andrew Cuomo And Barack Obama; With Special Guest Appearances By Bill Clinton And Jimmy Carter

    https://www.youtube.com/watch?v=Lr1M1T2Y314

    Barney Frank lies about his role in the housing bubble

    http://www.youtube.com/watch?v=M3lPyFMrwJc