I have many opinions about Russia’s invasion of Ukraine
The impact on markets is, personally, well down my list of concerns. But it’s my job to cover them, and this can be expected to have a big effect.
I needed to fathom the thinking of traders and investors who bought U.S. stocks in such volume that they forced one of the biggest turnaround rallies in history
In the medium term, investors are still as confident as ever that there will be no inflation problem. Or, to put it more bearishly, they still think the Fed will tighten too much over the next few months, and reward us with a sluggish economy thereafter.
The great majority of geopolitically driven selloffs since 1945 proved to be buying opportunities. That, along with some algorithmic buying of stocks that looked cheap according to a model, probably does account for the rally in New York morning trading.
The war aim seems to be decapitation of the regime, and installation of a Russian puppet. We can live with that; Ukraine has been run by Russian puppets before, and the world didn’t end
The natural gas price dooms any chance of a strong European response.
John Authers Bloomberg 25 February 2022
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