As suggested yesterday could be in the offing, TLT is up a bit today, meaning that long Treasury rates are down a bit, besting the stock market, which is trading heavy and a bit to the downside. Gold is rising adjusted for the mildly stronger dollar.
The volatility index (VIX) is lower, which is the opposite of what one typically sees with the Dow off 40 points and the S&P 500 down. VIX is under 21. The past 2 years, 20 or slightly under that has been the lower bound; and in the 1998-2003 period, 20 was also the effective lower bound (a low VIX correlates with generally rising stock prices). The last time the VIX dropped while the stock market dropped, a brief but sharp correction ensued, and the VIX rose to over 30. Could this disparity be a sign of complacency?
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