VIX HITS 14.1, ITS LOWEST READING ALL YEAR

🔴 The VIX fell to 14.1 on Friday, its lowest reading all year — on the same day rate-hike odds nearly doubled.

CNBC reports that after Federal Reserve chair Kevin Warsh's first Jackson Hole speech, Fed funds futures tracked by CME Group put the odds of a September rate hike at nearly 60%. Thursday, those odds sat at 35%.

Bond traders got the message. Stock traders did not flinch.

The S&P 500 slipped three-tenths of a percent midday as Nvidia unwound part of its earnings pop. That is about half the roughly 60 basis-point range options pricing had implied for the session.

Bitcoin and gold each fell at least 2.5%, which CNBC frames as investors across asset classes bracing for higher rates.

Ben Emons of Highline Asset Management told CNBC the low VIX reflects a Fed seen as vigilant on inflation without hiking aggressively — a setup traders read as bullish for stocks.

📉 But the calm is front-loaded. Cboe's Mandy Xu points to a steepening term structure: the spread between six-month and one-month S&P 500 options is in the 96th percentile of the past year. Late-February VIX futures are priced around 21 versus just under 16.9 for the active contract.

Translation: the market thinks higher rates bite later, not now.

Do you buy the calm, or is the VIX too cheap here?

#Fed #VIX #StockMarket #InterestRates #causeanuproar