Recent Volatility Trends

Recent market activity shows a significant shift in volatility trends, catalyzed by a troubling economic outlook and reactions to bad news. The spike in VIX cash, reaching a high of 65, was notable as it coincided with fears of a potential recession and the unwinding of the Japanese carry trade. This increased volatility occurred without a corresponding drastic drop in the broader market, leading to speculation about the factors contributing to these fluctuations. Traditional market behavior, where bad news often leads to selling, has seemed to reverse as investors reacted cautiously to new economic signals.