India Scares, ISM Disappoints, and Munger Curses

As it's been usual in recent weeks, India has been the main destroyer of sentiment in the financial markets. The pandemic is raging there. And although the central authorities of the country stubbornly refuse to announce a nationwide lockdown, individual states and the capital of the country are forced to declare it.

As a result, it becomes more and more obvious that India will not see double-digit GDP growth in 2021. The surge in the pandemic in the country has already minus about 7M jobs and triggered an increase in unemployment to 8% in April from 6.5% in March.

And then the ISM data came on business activity in the US manufacturing sector. Most of the elements, as well as the index as a whole, turned out to be below the analysts' forecasts.

One cannot help but recall the old rule of investors: “sell in May and leave the market”. If we analyze the statistics of the behavior of stock markets, including the United States, over the past few decades, it turns out that the worst time of the year for the market is the period from May to October, and the best is the period from October to May (the so-called Halloween Effect). So, statistically, now is the time to fix profits in longs and go into cash or even sell on the US stock market.

Meanwhile, the cryptocurrency market is undergoing tectonic shifts. Bitcoin, which at the start of the year with a share of 70% was essentially cryptocurrency markets, is rapidly losing its status as a crypto monopoly. The share dropped to 46%. Largely due to the rapid growth of ether, as well as Doge and Binance coins.

Charlie Munger from Berkshire Hathaway will remind you of what professionals think about the cryptocurrency market. During the Q&A session at the Berkshire meeting, he branded cryptocurrencies as best he could, calling them a disgusting development, useful only to kidnappers and ransomware. The position, of course, is quite an ultimatum, but it has a very tangible, reasonable grain.