Brutally, very cruel. Around the world, promiscuous selling and massive margin calls for long-term investment positions kicked off, which held out for over a year. Plus those start to come out, who bought the previous correction, behind them those, who bought the market in the morning, then those, who in the afternoon and so on. As a result, the glass of bids becomes empty, and there are many who want to sell. Prices are going down, irrationally, панически. No one can stop, because. previous bullish support is completely demoralized and unable to hold the market. The crowd sinks into fear and despondency and it seems, that nothing will help.
Something similar was in 2008 year, when they accepted the TARP plan and said, that we will support the market, but it did not help and the market continued to fall anyway, even faster. Вопрос заключается в том, that they are ready for serious action. Ie. to that, to repeat an event similar to Lehman? In the form of a default of one of the European countries, or bankruptcy of a bank in the USA, type Bank of America? By the way, and not for the collapse of August, banks in the US and Europe accumulated a record level of cash in their history?! Remember, the same cache, which aroused many questions. It looks like the puzzle is starting to take shape. But I repeat, the collapse may continue, if they move from rumors and news to action, because. someone will go bankrupt.
When the markets collapse, the financial system has such a feature., that funds are beginning to experience chronic liquidity shortages, especially when it comes to funds, where the share of margin positions prevails. And usually in such cases, they forcibly close positions even on "healthy" assets, which is already causing them to collapse and so on in a chain. Therefore, in case of mass panic, there are practically no defensive assets on the market.. Ie. everything falls indiscriminately, from good companies to bad. This was seen in 2008 and we see it now with one exception, what ... the gold is growing.
I would not be especially zealous with shorts, because. major central banks made it clear, so much money will be poured into the system, how much will it take. In fact, this is, what the market wanted to hear from them and why it flew down so furiously. The market can only be long if, that there is an opportunity to hold the pose. We know the power of liquidity very well, когда в течение 6-9 months, all problems in the economy were skillfully retouched and any, even insignificant desires to push the market. Liquidity has a magical effect on the market and in perspective, then the bottom is somewhere nearby and the redemption may begin soon.
but, not immediately and not quickly, otherwise it would be too obvious and easy, and there is never certainty in the markets, therefore, the operation of planting funds on margin колл may continue. As a landmark 1100 points on S&P, which corresponds to more, how 20% коррекции.
A source:
