Yesterday, we were discussing the signs of “Panic behind closed doors” (TwitterX), today we have 100% certainty that something big enough to justify extreme actions from the US Government and US Regulatory Agencies broke somewhere.
How else we can justify the SEC is still holding back the “Fails To Deliver data” specifically for the first half of October?!
Alright, now we have a specific time period to investigate, making it a tad easier than trying to find a needle in a #stockmarket barn. Let’s dig into it!
- The 7th October, the war between Hamas and Israel started out of the blue, but so far, it had little to no impact on the overall financial system.
- Companies Q3-23 reporting season started towards the end of the first half of October, but in that time frame, we didn’t see any particular “firework” despite the shameful banks’ reporting season.
- Screening #stocks and #bonds markets, the “softness” all around seemed justified by the events in Gaza, although here we can already spot something strange. AT THE BEGINNING OF OCTOBER, THE #NIKKEI CRASHED FROM ~32,400 to ~30,400.
- The 3rd of October, the $JPY was under significant pressure, and the government intervened in the market as soon as the FX rate hit 150 against the $USD. However, by the 12th of October, the $JPY was close again to ~150, so the crash of the #NIKKEI was clearly a factor of something else going on rather than simple jitters in the FX market. Otherwise, it would have spiked back up as soon as the $JPY quickly lost value again.
- Wait, something very odd happened in the first half of October that many have already forgotten about. ON THE 10TH OF OCTOBER, THE JAPAN PAYMENT CLEARING NETWORK “GLITCHED,” AND FOR 48 HOURS, 11 LARGE BANKS, INCLUDING MUFG, COULDN’T SEND/RECEIVE PAYMENTS.
Already at that time, we were half-joking that a Japanese financial institution could have run out of liquidity… BUT, WHAT IF THAT WAS EFFECTIVELY THE CASE?!
From the recent ICBC “Hack” saga, we know that a shortfall of 9bn $USD alone is enough to send the biggest and most liquid market in the world into a total state of panic (TwitterX).
Now, would it be possible that the #BOJ and the Japanese Clearing Authority decided to “Turn Off” the payment system to hide a large financial institution liquidity crisis? Is it possible that the heavy selling in #stocks that started around the 12th of October and ended towards the end of the month was due to this large institution being margin called and getting its collateral liquidated? The liquidation wasn’t limited to #stocks, but if you remember, it was particularly hard in the US Treasuries market, with the 10y yield even crossing 5% briefly.
Lately I flagged that Softbank is in a precarious position (TwitterX). Well, in all fairness, Softbank is a very big ultra leveraged player in the markets, particularly in the derivatives one, big enough to represent a SYSTEMIC RISK.
At this point, it is fair to wonder, WAS THIS #STOCKS LAST BREAKNECK RALLY AN ATTEMPT TO RESCUE #SOFTBANK SQUEEZING THE WHOLE MARKET UP, PARTICULARLY TECH STOCKS THEY ARE VERY DEPENDENT TO FOR THEIR VALUATIONS LIKE $NVDA (TwitterX)?
SOFTBANK DID THIS BEFORE IN AUGUST 2020 (TwitterX), AND YOU CAN BET THE WOLF LOSES ITS FUR BUT NOT ITS VICE.
Furthermore, yesterday we found out a possible link between them and Geode (TwitterX), and we also know that Geode oddly has a large chunk of its AUM in custody at the #BOJ (TwitterX).
I will conclude with 2 open questions: Is #Geode working on behalf of the #BOJ to keep the global #stocks bubble inflated in coordination with Softbank so that the latter doesn’t go bust and spectacularly pop the biggest bubble ever created? Furthermore, is the US Government now aware of this risk and actively helping the #BOJ?
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