Chaotic Market Conditions and Worsening Prospects

During the past week, the volatility in various markets has accelerated as the US economy has displayed ever-increasing signs of weakness and vulnerability.

Whether we look at equities, fixed income, crypto, currencies, or commodities, chaotic market conditions have prevailed, with volatility shooting higher.  Stocks, for example, have dropped by nearly 9% since the 19^th of February, and they are showing no signs of stabilizing.  The daily ranges have  increased sharply, and we are now approaching daily swing levels last seen during the vicious sell-off in equities in 2022.  In fixed income markets, the yield on 10-year treasuries has crashed lower, dropping by roughly 12% in just a few short weeks.  One of the stated goals of the new Trump administration was to deliver lower interest rates for US consumers, but I seriously doubt that they wanted the yields to plummet due to chaotic market conditions and worsening prospects for the economy. 

Currencies have also been flying around, and the crypto markets have been absolutely wild. The constant flux in US trade policy, federal job layoffs, and a variety of related factors have  taken a heavy toll on consumer sentiment. 

Suddenly, the specter of a recession is hanging over the US.  President Trump has even suggested that we need to brace ourselves for more pain, and investors have taken that message to heart.