XJO 1.04% 7,730.2 s&p/asx 200

The yield curve is still inverted, but for some reason, it's...

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    The yield curve is still inverted, but for some reason, it's been overlooked.
    As a young adult who had just broken into the middle class in 2005/2006, I was euphoric about my net worth. The financial crisis quickly made me aware that wealth on paper is merely a mirage unless you do something about it. In 2007, monitoring my home value on Zillow (yes, I know their "Zestimates" are not necessarily accurate estimates, but they are convenient) and hitting the browser refresh on my investment portfolio was like a drug. The higher the numbers, the wealthier I felt, and the more bullish everything appeared. Looking back, it was both euphoric and complacent. The years following were a reality check; stocks lost over half of their value, and my home in Las Vegas was among the worst-hit zip codes in the nation, with losses close to 80%.
    Risk came fast and hard with very little warning. Almost two decades after the financial crisis, I have yet to forget what true despair felt like, and I hope I never do because it is my mechanism for tapping the brakes on risk when things are going too well. I hope I am wrong, but it feels like things are going too well at the moment. Further, I see signs of dysfunction similar to those that were present prior to the Financial Crisis, such as overleverage (think Yen carry trade), complacency (think Dow 14,000 caps in 2007), and yield curve inversion (inversion started in early 2006 and recession officially arrived in late 2008). If everything is going unusually well for you regarding asset valuation or even your speculative trading, it might be time to focus on protecting accumulated wealth. Unless you hit the sell button or hedge your price risk, it doesn't count; complacency kills.

 
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