Wednesday, December 17, 2008
Here's an update of a chart I've posted several times in the past. The VIX index, a measure of the implied volatility of equity options, is almost as low today as it's been since the panic phase of this crisis started a few months ago. As panic subsides, I've argued, then equity prices should rise. That appears to be the case, but so far equity prices are lagging. The market is still reluctant to accept the notion that the fundamentals are improving. Perhaps it's difficult for people to embrace the Fed's massive easing efforts as something that can have lasting positive benefits.
Posted by Scott Grannis at 10:42 AM