Broken Pie Chart

Derek Moore is back together with Jay Pestrichelli this week to react to the market turmoil. What is going on and is this just a revaluation or something worse? Plus, now the Fed Funds’ futures indicate 3 rate cuts. Looking at the Mag 7 selloff compared to the rest of the market. Unemployment was fine so what’s the big deal? Later, looking at whether the options market via the implied volatility readings is pricing in more, less, or just right actual historical volatility. They even take a listener question and read a sad email from an avid listener who is boycotting the show. We hope they come back but this week we dig into everything markets and provide some historical context and whether there are bullish signs.

Peter Lynch on corrections from 1994

Comparing this drawdown to all the others since 2009

Why investors shouldn’t panic

Reminding everyone why it’s good to be hedged to ease your mind around corrections

What are options markets saying via the implied volatility levels and the Vix Index

Comparing 10 Day implied volatility on SPY options vs 90 Day implied volatility

The S&P 500 Index forward PE ration vs earnings estimates

Nvidia bear market territory despite earnings beats and falling Forward PE ratio

Washington DC new unemployment claims in perspective

The unemployment rate of 4.1 percent threads the needle

3 Fed Rate cuts now priced in 2025?

Value of hedging your portfolio

High yield has held up ok so far compared to the equity market

Earnings estimates are still higher, but will analysts cut them due to tariffs?

Uncertainty of Tariffs

Why the Atlanta Fed GDP Nowcast went negative

Balance of trade on exports minus imports due to tariffs gets really wide

Trade deficit expands

Mentioned in this Episode

Peter Lynch 1994 video talking about corrections in markets frequency https://zegainvestments.com/blog/for-investors-worried-about-market-corrections-this-is-why-you-hedge-so-that-you-can-worry-less

Derek Moore’s book Broken Pie Chart https://amzn.to/3S8ADNT