The chart below shows 20 years of the VIX (volatility index) vs the DOW. They are generally inversely related, low VIX strong markets, high VIX weak markets, with VIX 20 being a generally accepted divider and VIX 30 effectively meaning look out below.
To me, given all that that is going on in global markets and geo-politically, VIX apparently approaching historical long term lows, supposedly representing calm, business as usual times, is an anathema … is it a trend ripe for reversal or a trend heralding in the start of long period of calm, stability and prosperity in markets.
I am extremely dubious about the latter, which imo would require resolution in Ukraine significantly in their favour and a sudden rapprochement between China and the US (as in PGA/LIV in golf parlance) … anyone care to rate the chances of either or both?
Dex
