Cannibal Spirits

The term "animal spirits" is often used to describe the appetite for risk-taking in markets, but it is overused and misused. The author has been skeptical of Bitcoin and cryptocurrencies, but now acknowledges their growing importance as a gauge for risk-on sentiment. As the market cap of Bitcoin grows, so does its systemic risk. The author remains cautious about the potential risks, including the threat of quantum computing and the possibility of a market panic. Despite this, the author believes that the stock market has remained resilient due to excess liquidity, strong investor optimism, and confidence in Fed policies. The author also notes that the nation feels relieved after the election, but reminds readers that freedom in markets means prices can go both up and down. The author's disclaimer emphasizes that the post represents their opinions only and they may own or transact in any names mentioned without warning.