What we’re reading (10/27)
“S&P 500 Enters Correction” (Wall Street Journal). “The autumn pullback in the stock market worsened Friday, pushing the S&P 500 into a correction and to its worst two-week decline of the year. The broad stock-market gauge wavered for much of the day before turning lower and losing 0.5% for the session, bringing it down more than 10% from its recent high. A drop in shares of Chevron and JPMorgan Chase helped send the Dow Jones Industrial Average down 367 points, or 1.1%, to its lowest closing level since March.”
“Gold Is Officially Outperforming Stocks In 2023 As October Rally Continues” (MarketWatch). “It’s official: gold is officially outperforming the S&P 500 stock index in 2023 due to an October rally that has brought the price of an ounce of the yellow metal to the cusp of the $2,000 mark, a level it hasn’t seen since May. Metals traders attributed gold’s gains to a surge in demand for hedges and safety plays following Hamas’s Oct. 7 attack on Israel, which provoked a war between Israel and the group that is deemed a terrorist organization by the U.S. and European Union.”
“The Bond Market, A Sleeping Giant, Awakes” (New York Times). “The bond market is stirring. The business world and the Federal Reserve have been forced to take notice. Politicians in Washington may need to do so soon. After years of low interest rates, yields throughout the vast global bond market are soaring. Just this past week, the yield on the world’s most important fixed-income benchmark, the 10-year Treasury note, briefly exceeded 5 percent.”
“Wall Street Braces For Roughly $1.5 Trillion In Further Borrowing Needs By Treasury” (MarketWatch). “Treasury’s heavy borrowing is one of the most important factors behind the recent, steep run-up in long-term yields, which ended the New York session at their highest levels since 2007 last week. Since July, 10 and 30-year yields have each jumped by a full percentage point or more as traders fret over the onslaught of supply for Treasurys, the U.S. government’s fiscal trajectory, and the risks of holding long-dated government debt to maturity.”
“Sam Bankman-Fried Is Going To Talk Himself Right Into Jail” (The Verge). “Sam Bankman-Fried is so fucked. I have come to court every day since opening arguments thinking, Surely things cannot get worse for this man. Surely we have reached the bottom. Unfortunately, there is no bottom — in the prosecution’s telling, FTX and Alameda Research, his exchange and trading company, were matryoshka dolls of crime. Today, the defense started its case, which should theoretically present Bankman-Fried in a better light. But if what I saw of him on the stand is any indication, he may be more damning for himself than any of the prosecution’s witnesses.”
