I see 3 factors: the first 2 are in the past and the 3rd is just starting now. First, if we follow your analogy about gravity and the Feds try to manipulate that law (e.g. by inverting the yield curve or printing fiat currency) that is like flirting with the Karman line at which point aeronautics act funny (or useless), for low but not nearly zero interest rates, it is different - it is like Low Earth Orbit where the ship (market) will still be within reach of gravity. Hence, the proper set to maneuver is altered e.g. by going faster horizontally perhaps, but then the trajectory formula is also different. Now, add to that the 2nd factor of HFT / automated trades, and the reaction is magnified very fast (even if only one algorithm is wrong, it does not matter because the flow pattern will be followed by all other HFTs, especially if the less than perfect algorithm came from a bigger firm - roughly this is the version of AI with emphasis on Artificial or the machine version of "monkey see, monkey do". The up and coming rise of the retail investor will be the 3rd factor. We do not have a lot of data yet, but so far, based on GME, RKT, AMC, it will be an interesting future market. Serves us right when the USA retirement system basically "forced" ordinary folks to become "investors" via deferred retirement plans, WITHOUT any commensurate effort on the EDUCATION side. Financial literacy today is not part of any minimum grade school or high school curriculum, yet both white and blue-collar workers today are told to put money away in 401-K and eventually roll over to self-directed IRA when they change or quit jobs. Imagine if we put millions of random people (without any training) into a rocket beyond the Karman line just to see how they behave in weightless environments (I think the biological functions alone done in that space will have all sorts of unpredictable stuff individually and in aggregate....hmmm).
As a trader, I keep it simple: From what I see, everybody focusses on the FED and their wording. All of the other macro indicators don‘t matter if there is so mich money and only rewardless rsik in bind markets. I just care about price action, about the trend and follow with a strict risk and money management. Thats‘s why it pays to ride an irrational bubble from time to time (what we see in cryptos currently).
I see 3 factors: the first 2 are in the past and the 3rd is just starting now. First, if we follow your analogy about gravity and the Feds try to manipulate that law (e.g. by inverting the yield curve or printing fiat currency) that is like flirting with the Karman line at which point aeronautics act funny (or useless), for low but not nearly zero interest rates, it is different - it is like Low Earth Orbit where the ship (market) will still be within reach of gravity. Hence, the proper set to maneuver is altered e.g. by going faster horizontally perhaps, but then the trajectory formula is also different. Now, add to that the 2nd factor of HFT / automated trades, and the reaction is magnified very fast (even if only one algorithm is wrong, it does not matter because the flow pattern will be followed by all other HFTs, especially if the less than perfect algorithm came from a bigger firm - roughly this is the version of AI with emphasis on Artificial or the machine version of "monkey see, monkey do". The up and coming rise of the retail investor will be the 3rd factor. We do not have a lot of data yet, but so far, based on GME, RKT, AMC, it will be an interesting future market. Serves us right when the USA retirement system basically "forced" ordinary folks to become "investors" via deferred retirement plans, WITHOUT any commensurate effort on the EDUCATION side. Financial literacy today is not part of any minimum grade school or high school curriculum, yet both white and blue-collar workers today are told to put money away in 401-K and eventually roll over to self-directed IRA when they change or quit jobs. Imagine if we put millions of random people (without any training) into a rocket beyond the Karman line just to see how they behave in weightless environments (I think the biological functions alone done in that space will have all sorts of unpredictable stuff individually and in aggregate....hmmm).
As a trader, I keep it simple: From what I see, everybody focusses on the FED and their wording. All of the other macro indicators don‘t matter if there is so mich money and only rewardless rsik in bind markets. I just care about price action, about the trend and follow with a strict risk and money management. Thats‘s why it pays to ride an irrational bubble from time to time (what we see in cryptos currently).