Bonds, Bullion, & The Greenback are all higher since The Fed threw in the towel... stocks are lower...

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And despite the desperate efforts to talk up the economy, SHTF today...

Chinese stocks managed gains on the week, thanks to three big liftathons...

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European markets were ugly all week...

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US equity markets had their worst day since Jan 3rd - all ending the week lower...

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Dow futures fell 500 points from the overnight highs...

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And the S&P 500 fell all the way to stop dead on 2800...

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Marking the sixth refusal at that magical level...

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As Bloomberg noted, you know things have gone a bit pear-shaped when utilities and tech are the top gainers, comfortably outperforming the broader market. But they took quite divergent paths to get there.

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It appears the squeezers ran out of ammo...

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Buybacks had a good week - until Friday, as the blackout window looms...

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Big bank stocks have bloodbath'd this week (worst week of the year) as the hopes of higher rates and steeper curve evaporate...

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But Regional banks were clubbed like a baby seal... the biggest weekly drop since Sept 2011 - after the USA downgrade

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And bank CDS have started to creep higher...

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Tesla had an ugly week...

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Credit and equity protection costs surged on the week...

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Yields collapsed around the world this week, with 10Y bunds going negative once again...

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Global average sovereign yields plunged to lowest since April 2018...

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US Treasury yields crashed this week... this is the biggest weekly drop in 5Y, 7Y, and 10Y yields since April 2017

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For the first time since 2007, the spreads between 3m and 10y yields inverted - flashing the most-effective recession indicator since WW2...

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And inflation breakevens plunged, despite a lack of oil confirmation...

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The yield curve is now inverted to Fed Funds out to almost 10Y...

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Notably, The Fed is now priced to be easier than The ECB in 2019...

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The dollar index ended the week very marginally higher thanks to serious buying-panic in the last two days since The Fed...

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The relative stability expected from an easing Fed has prompted a run into carry trades and USD remains a big player.

The Turkish Lira collapsed today as a surprise tightening by the Turkish central bank failed to stem a rout in the wake of an unexplained drop in official reserves.

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“Today the unsustainable nature of state-owned banks being the only sellers of [US dollars in exchange for lira] over recent weeks became evident,” said Roger Hallam, chief investment officer for currencies at JPMorgan Asset Management.  

Bitcoin managed gains on the week but Bitcoin Cash outperformed...

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Copper ended the week lower as China growth questions continued but WTI and PMs managed to hold on to gains despite the dollar ending higher...

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Gold rallied for the 3rd week in a row...

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WTI topped $60 intraweek, but ended back below $59...

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Finally, we refer to Knowledge Leaders Capital Bryce Coward's analysis of what happens next...

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We’ve cataloged all 20 uninterrupted 15% declines in the post-war period and documented what has happened afterward, as well as the type of market environment in which those declines have taken place. By uninterrupted decline, we mean a waterfall decline of at least 15% without an intermediate counter-trend rally of at least 5%. Some bullet points describing the rallies following those declines are below:

• The average counter-trend rally following a 15% waterfall decline is 11.9% (11% median) and it takes place over 21 trading days on average (median 11 days).

• The rallies end up retracing 57% of the decline on average (median 52%).

• Waterfall declines of at least 15% have only taken place in bear markets.

  • The average of those bear markets have a peak-to-trough decline of 33% (median 29%)

  • The duration of those bear markets is 284 trading days on average (median 139 days)

  • In 16 of 19 instances (excluding the decline we just witnessed), a recession was associated with the bear market

• 100% of the time the low resulting from the waterfall decline was retested, and in 15 of 19 cases, a new lower was made.

It's different this time though...

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