TLDR: at the bottom

Edit: Changed fair to speculation/opinion as your feedback does make sense. There is too much speculation around this but the unfortunate thing is I believe it will never be clear due to the sensitive nature of the topic.

Disclaimer: It is my first attempt at compiling a research for masses to read on reddit and provide further strength in my arguments or rebuttals that would disprove my thesis. The biggest weakness to my argument is that finding concrete evidence is extremely hard as "currency printing" is an extremely sensitive topic and both governments and the companies doing the printing both refrain from providing the public with too much information because of "national security" reasons. Long story short, this is very speculative because of the lack of transparency in the government.

Thesis: The Black Swan event that the media has been talking about that could potentially devastate not only the US economy but also the global economy is here -- and it is China's money printer.

The status of the rumor revolving around the $314 billion USD worth of printing done under the leadership of Chen Yaoming of People's Bank of China is still unclear and for obvious reasons China/CCP denies this rumor.

Link to Bloomberg's first article talking about China denying such rumors

https://www.bloomberg.com/news/articles/2021-12-22/china-denies-detained-mint-banker-forged-314-billion-of-notes

For many of us, this article was our first exposure to such scandal revolving around the Chinese government printing money. Regardless, two things that stood out to me about this article as
1. Why did I hear about this rumor first through a denial report from Bloomberg?

2. Why is the rumor specifically $314 billion?

If you are on this subreddit, let alone reading this post, I will safely assume that you do not trust everything the MSM has to say. In this case, I believe that their extreme silence towards this topic is just as obvious in their motives. If people (the majority of the population) know for a fact now that the Chinese government has been printing money, but unaware to what degree, there will be an insane amount of panic running in the markets-- both domestically in China and globally. In case you have been living under a rock and believe that illegal printing of the yuan would only affect China and h

Notes:

• Time Period Analyzed: 11/27/2020 to 2/19/2021
• Options data was pulled from contracts that had expiration dates from January 8th until February 19th, 2021.

Disclaimers and Constraints:

• This information does not constitute financial advice.
• The information used in these analyses was extracted from chartexchange.com and is available to the public.
• The total amount of calls and puts for the period analyzed is understated: there is volume for calls and puts that were purchased and held (open interest) for contract expiration dates later than February 19th 2021. This statement is especially true for out of the money puts that were purchased on January 26th, 27th, and 28th of 2021 for contracts that expired after February 19th 2021. This part of the analysis will be conducted in a separate post as it brings to light an important phenomenon that did not happen prior to the black swan event - the abundant purchasing of OOTM puts at < $5 strike prices.

Daily High Stock Price vs Max Option Strike

Notable Dates on This Graph:

• 1/13/2021: The stock price nearly doubles (+89.46%) but market makers only increased the max strike by 25% (from 40 to 50). At this point, the daily high was 77% of the max strike price, which was unprecedented for the time period analyzed up to that point. This date is also important as the daily stock volume increased almost 20x (1946%) along with a massive increase in call volume (+1065.87%) and put volume (+1845.14%) respectively.
• 1/22/2021: The daily high of the stock price ($76.76) passes the maximum strike of 75, thereby making every single call on that date in the money (ITM) for a short period of time. In premarket on 1/25/2021, the price pushed to $136.
• 1/25/2021: The daily high of the stock price ($159.18) once again passes the now doubled maximum strike of 150, once again making every single call on that date ITM for a short period of time and later that day the price is promptly shut down to 50% of the maximum price to a low of $75.51.
• No other dates observed does the daily high stock price pass the maximum strike price, but there were close attempts on 1/26/2021 and 1/27/2021.
• On 1/29/2021, market makers set the options strike price to its maximum of 800 for options out for the remainder of the time period

TLDR: Past short squeezes have often come after a sudden unpredicted float reduction as showcased in Northern Pacific of 1901 and VW in 2008. BBBY share repurchase announcement exemplifies this quality of squeezes and sent ripples through the "meme basket".

Hi all, to quote Winston Churchhill, "The farther back you can look, the farther forward you are likely to see", so we will be using history that has occurred in past "short squeezes" as well as some recent information to mold my thesis.

Also, I found it helpful to realize that any of these trading situations from years before computerized trading with a slight grain of salt. Why? Because "a trade" took a lot longer back then, like minutes instead of microseconds, which is worldly different but general principles apply. It is only exacerbated in the complexity of modern markets by high-frequency trading and in general how fast trading has become.

1901 Northern Pacific Squeeze

A slugfest between two titans, James Hill/J.P. Morgan and Steve Harriman, in one of the last great railroad wars of America. In 1901, Union Pacific was in a shitty position, mired in bankruptcy, and not enough profit to meet its obligations. However, Steve Harriman believed that if Union Pacific could acquire railroad lines in Chicago(Burlington & Quincy Railroad) the railroad would become extremely profitable and powerful. However, James Hill and the Northern Pacific Railroad, with support from J.P. Morgan, thought the Chicago railroads would bring massive profit also. In the ensuing negotiations for Burlington. The owner of Burlington went with the Northern Pacific offer. This royally pissed of Harriman and theoretically, Hill/Morgan only owned 23% of Northern Pacific. So, Harriman became Chad Harriman and began buying Northern Pacific shares on the open market secretly to wrestle control from Hill/Morgan and utilize the Chicago railroads.

Pause, this was a 155 million dollar market in 1901 dollars(5,002,123,529 in today's dollars). Fucking huge market. So pretty much if Jeff Bezos began buying all Gamestop common shares on the open market because he believed the NFT marketplace for games would be huge.

Well, Morgan and friends didn't realize that Harriman did such a big dick wreckless move until Harriman almost owned the entire float. That's when the price started rising as the bidding war began between the two parties. As they bid up the stock, a flurry of short-sellers entered the equation. Now *enter a classic

Isabelle Furhman who gave a great and unsettling performance (especially for a child actor at the time) in Orphan, is finally given a long overdue lead role and man, is it harrowing, frightening, and unforgettable. Her performance and character continues to live rent free in my head and I watched it over a week ago. She's rightfully already won best actress at a couple festivals, and thankfully got an Independent Spirit Award nomination. The film also got nominations for best feature, best director, best supporting actress, and editing and cinematography.

What Whiplash did for jazz band, and Black Swan did for ballet, The Novice does for row crew. It's another character study of a person willing to go beyond their limits both physically and psychologically and then even further, no matter the cost. But with its propulsive and gorgeous direction/editing/cinematography/sound design, it ends up being a heart pounding, unsettling, and disturbing psychological thriller that just happens to be about row crew.

I'm being vague because it's best to just go in blind. But Furhman, just, wow, really adds to the intensity. I can't stop thinking about it and look forward to watching it again. Just make sure you have some booze or anxiety meds, because it's like one extended panic attack that is relentless and doesn't let up even after the credits start to role. It's also a great debut feature and I look forward to whatever Lauren Hadaway does next.

Don't let this one go under your radar. My palms were sweaty for basically the entire time, and I felt just as bruised and ruined by the end.

Give Furhman the damn Oscar nomination! it won't happen. But she deserves all the accolades. I hope she finally breaks out after this, like she should have after Orphan.

Gold reserves being bought by Central Banks. Covid Stimulus ending. Inflation rises. Are we looking towards a massive crash? This is going to be a massive boost to Bitcoin and Crypto.

Nassim Taleb

Fooled by Randomness

• Survivorship Bias means you don&#39;t hear from the losers on a topic, you only hear from the winners.
  • Watch out judging a person by their results because history will only show you the winners. You won&#39;t hear the stories of the losers
• Over short terms, you see variance, not returns. Don&#39;t monitor your portfolio on a daily basis
• AFTER an event has occurred, it is easy to make a story as to why it happened and why people should have seen it. But it is difficult to see in advance BEFORE it happens
  • Events are more random than we think
• Negative pangs cause a 2.5x more emotional response than a positive one
• It is not how likely an event is to happen that matters, it is how much is made or lost when it happens that should be the consideration
  • Maximize your profit expectancy, not probability
• I try to benefit from &quot;rare events&quot;, events that do not tend to repeat themselves frequently
• I believe that rare events are not fairly valued, and that the rarer the event, the more undervalued it will be in price
• Investors for pure emotional reasons, will be drawn into strategies that experience rare but large variations.
• Pascal&#39;s Wager – The optimal strategy for humans is to believe in God because if God does exist the believer will be rewarded and if he doesn&#39;t exist, the believer has nothing to lose.
  • IE - Inequality of outcomes, don&#39;t try to pick up nickels in front of a train
• There is no point in searching for patterns that are available to everyone; once detected, they would be self-canceling
• &quot;One cannot judge a performance in any given field by the results, but by the costs of the alternative (i.e. if history played out in a different way). Such substitutes courses of events are called alternative histories. Cleary the quality of a decision cannot be solely judged based on its outcome.
• Past events will always look less random than they were (hindsight bias)
• Probability almost never presents itself as a mathematical problem or brain teaser
• No one accepts randomness in their success, only in their failure
• Take into account the costs of mistakes
• Bad information is worse than no information at all
• 5 traits of a Market Fool
  • Overestimating accuracy of data or overconfidence
  • Getting married to positions
  • Changing story
  • No plans for taking losses or exit strategy
  • Denial of luck and randomness

**

Every Monday - Friday at 7am CST

u/not_ya_wify

u/mollila

GOOOOODDDDD MORNNNNININNNNNNGGGGG SSSSUUUPEERRRRR SSSSTOOOOOOOONNNNNNK!

I am u/Odd-Ad-900 and I am your mildly unhinged morning news anchor.

Yes, I took my Reddit given name. No, I am not "new". Calling me a shill? MGGA Please... (psshhhh)

I want to give A Big thank you to my news team u/blazlyn, u/viviconsadventures, u/tokyorose and our very own mods u/dismal-jellyfish and u/luma44 You guys are the best! And I couldn't do this without you.

Can You Smell That? It smells like the fire that will consume Rome. It might be a good show!

God I love this job.

My poor nipples...

Insert NON-FLACCID intro card:

HARD

u/pctracer has been coming through like a champ for MONTHS NOW!!! Thank you APE. It is a safe bet that most of us did not know anything about RRP before this past spring, and you sir/ma'am, have kept it up for so long even an enzyme would make noise (https://youtu.be/3w-D_Pp2gEM) From all of us here at The Daily Stonk, Thank You. Keep up your good work.

u/pctracer

We have a new high score!!! LFG!!!

u/whoaitsnick915

This post could not be more important to read. Do not believe any bullshit. We are pretty immune to it at this point, but if you hear something Fucky, please be aware and ask questions before jumping to conclusions.

[ u/amh13 ](https://preview.redd.it/hm0x5z976h881.png?

I've seen a lot of fear recently based around an accelerated FED taper and a stock selloff taking down the crypto market. While I don't want to discount this possibility, I have done some DD and think there is a really interesting historical comparison to be made.

In the words of Michael Saylor, Bitcoin is digital gold. It is the most sound money ever created, and its fundamentals are even better than those of the original physical gold. It has a finite supply which is completely transparent to everyone, it can be carried with you anywhere just by knowing your key, it is infinitely divisible, and it can be easily used as payments with Lightning or even on chain for large transactions.

If we believe that it fundamentally is a gold 2.0 and sound money (as I do), then it would make sense to compare it to gold during a market crash. We haven't ever had a real recession during Bitcoins existence, so let's take a look at the next best thing.

Here is a chart of gold during the late 2000s and early 2010s.

As we can see, while gold corrected around 30&#37; initially, it then went on its biggest parabolic rally yet as investors transitioned to risk-off assets.

Let's look at how that compares to what stocks were doing during the same time.

The stock market was absolutely destroyed, and unlike gold, took over 5 years to even recover. Obviously in the long run it went to the levels we see now, but it had completely brutal losses compared to gold and lagged in recovery both by time and by speed.

When companies miss revenue, houses get foreclosed on, and the velocity of money slows down, gold just does its thing. It never relied heavily on the economy to be a sound form of money, and neither does Bitcoin. Bitcoin also will just continue doing its thing during an economic crisis. Block every 10 minutes, 6.25 per block, hash rate goes up. Nothing more nothing less.

Most rich people, and businesses, are not dumb. Aside from what all the news companies may say, Bitcoin is not fundamentally a 'risk-on' asset, and I can guarantee that there are many wealthy people behind the scenes who already recognize that. Its volatility has been trending down and will continue to do so. It now has over a decade of

I have Google News feeding me any and all stories related to Candida auris with a goal that these outbreak stories hit my radar faster than an Elon tweet surfaces on the radar of Tesla investors. If you are currently invested in or considering an investment in Scynexis, I suggest that you do the same with whatever news platform you use.

These outbreaks will continue to happen over the near-term as COVID keeps hospitalization numbers near all-time highs and as certain COVID treatments keep immune systems suppressed in small subsets of hospitalized patients. The white swan of this story is any outbreak of Candida auris, such as the one that just happened in late December (and is covered in the news story linked at the very bottom of this post) or the two outbreaks that happened this past summer in Texas and Washington, D.C. that killed several people.

The black swan event is an outbreak of multi-drug resistant (MDR) Candida auris that resists the echinocandin and azole antifungal drug classes. The headline for that event will read "Outbreak of Multi-drug Resistant "Superbug" Fungus Emerges in US hospital". This will be especially true if it finds a way to circumvent current hospital containment procedures.

What is Candida auris?

Candida auris is a species of fungus from the genus Candida. Candida cause a number of different fungal infections in the body, the most common of which is Vulvovaginal Candidiasis, also known as a vaginal yeast infection. Yeast infections are largely caused by the species Candida albicans, against which Fluconazole is highly effective at treating.

C. auris does not cause vaginal yeast infections (though many other species of Candida do and are worthy of attention for anyone trying to predict near-term annual sales numbers for Scynexis). Instead, C. auris has gained widespread attention for being a recent cause of invasive candidiasis which is an infection of the bloodstream and is highly fatal for those that get it (30-60% mortality rate).

Invasive candidiasis is caused by other Candida species, too. But, C. auris is particularly bad because some of its strains resist the first-line and step-down therapies for fungal infections of the blood. These patients typically have no other treatment option. Resistance to one of the leading antifungals for Candida species (Fluconazole) is almost an innate trait of C. auris at 90% resistance (I've seen as high as 96% in some research papers; either way

My running theory has been a little different… more of a slow bleed over 2022 to end of 2023… where summer 2023 might be the best time to buy

BUT I just had something enter my brain now and these thoughts just percolated…

My parents just mentioned to me they want to sell this spring.

They don’t want to move this winter.

They know “that’s when the frenzy will be”.

There’s probably millions of lizard brain boomers out there thinking the same thing. “Buy gold” “list in spring” just more boomer “common sense”

———-

Add this to a wave of people who regret their 2020-2021 FOMO purchase listing (we’ve seen an uptick)

https://www.reddit.com/r/REBubble/comments/r7vd7r/regret_selling_house_after_only_1_year/

https://www.reddit.com/r/FirstTimeHomeBuyer/comments/r0qa3t/anyone_else_buy_a_lemon_house/

———-

Add Foreclosures and short sales etc are going to be hitting over the next 90 days… taking investors away from the “normal” homes. No more biding against investors.

https://www.reddit.com/r/REBubble/comments/r7iixz/rrealestate_told_me_this_was_cancelled_thousands/hn0l3z4/

——-

Add the New homes are being built as spec homes…. And because they’re delayed with supply chain BS, they’re “started but not complete”…. More homes are started but not complete than anytime going back since the 70s

All the news I’m watching says supply chain is getting better fast. These homes will be complete by Q1 Q2 and since they’re spec homes they’re not spoken for they’re new inventory

https://calculatedrisk.substack.com/p/most-housing-units-under-construction

So

350k homes on market now

https://twitter.com/mikesimonsen/status/1465426502028193793?s=21

Normally 950-1.5M

Add 250k forbearance boost

600k hooms

Add new builds (say, 800k)

Now 1.4M hooms

Add 200k “regret listers”

1.6M hooms

Add 1M lizard brain boomer hooms getting listed

2.6M hoom listings

Every single one of these cohorts is “waiting it out to get more money in the spring”

In 180 days we could see inventory go from 350k to 1.5M+ easily… that would be a huge shock to the systems for sellers… if it somehow perfect storms and happens over like a 90 day period as spring starts it could be Hilarious 😂

I’ll go clean up typos and add source links tomorrow

EDIT: ok so we probably won’t see 2.5M inventory this summer/spring but just some simple math above shows you how many variables/places we could see inventory come from. We could easily triple the current inventory of 370k to nearly 1M… easy.

Even if we don’t explicitly choose to be overweight tech, most of our 401k’s are heavily exposed to tech, considering that FANG, Apple & Microsoft make up 25% of the S&P 500.

The NASDAQ-100 has had a remarkable run since 2003, having had only 1 negative year (2008, -41%) on a total return basis and 2 (2018, -1%) on a nominal basis.

Everyone’s moving to the cloud, and there are plenty of exciting new technologies on the way (autonomous driving, virtual reality, internet of things, etc. etc.)

The internet bubble popped in 2000 because it was being driven by a lot of lower quality companies. This time, FANG+ are generating massive profits and Facebook/Apple/Google are trading at 24 to 28 times earnings - high but not extravagant. And it took 6%+ interest rates to pop the bubble back then.

Many people, myself included, cannot conceivably think of a scenario or black swan event that could sink this industry & produce steep losses like in 2000-2 & 2008. But it‘s precisely times like this when it’s good to get defensive and hedge against downside risk ... yet in consideration of the above, hedging just feels like throwing money away.

What do you think? Are you hedging your tech exposure?

God ur eyes are gonna HURT during this month

You wake up and check the charts: BTC is down 30% and Alts are crumbling.

You hurry to see what is happening and it's all over the news: [insert black swan event here]

The market is on a downtrend and your portfolio is going down at each minute.

Do you pull everything out or just HODL?

I've always wondered what would be the best thing to do and if I should just pull it out on a downtrend and just comeback in later or just let my portfolio soak it all in

One way to be prepared is taking profits, which I'm already am, but I feel I should be ready to take advantage of this situation too

G'day cunts, thought it'd be a fun dumbfuck discussion to see what crazy theories are out there as to what the next major Black Swan event will be that impacts the world. If we all throw our hat in with a prediction, maybe one of us will knock it out of the park and get to feel smug on the internet.

For the cunts that need explaining, a Black Swan Event (first coined in the book "The Black Swan" by Nassim Taleb) is a sophisticated wankery metaphor used to describe highly impactful events that come out of nowhere.

To be classed as one, they should have the following three properties:

• They are unpredictable and extremely rare. More specifically, the probability of such an event occurring is so low that there is insufficient historical data to build a meaningful probabilistic model calculating the chance of the event occurring.

• They have a major effect on the world. Pretty fucking self-explanatory.

• With the benefit of hindsight, dumb cunts will explain how it was obvious that this would occur.

One thing people get wrong about Black Swan Events is that they are observer dependent, AKA an event might be a Black Swan to you but not to me. Someone as autistic as Michael Burry had the foresight to go through through all the spreadsheets explaining how mortgage backed securities worked, while the investment banking world bundled the shit into a black box and sold it. The GFC was a Black Swan for them, but not Burry.

Another minor point is that these events don't have to take place in a single moment, they can take several years to play out and still be Black Swans.

Some examples of Black Swan Events in the past 50 years to give you an idea.

• The Fall of the Soviet Union (1991)

• 9/11 Attacks (2001)

• Emergence of Google (1998-2010)

• The Global Financial Crisis (2007-08)

My one (which is pretty fucking tame), I believe the entire world economy is overexposed to China as a producer, and the Great Chinese Recession which is just starting now will lead to abysmal returns in the stock market over the next 5-10 years. Evergrande is merely the tip of the iceberg to the systemic rot in the Chinese system. Yes I'm a little late to the party in calling this a Black Swan, shout out to the guys who figured this out five years ago.

Another one likely would be a major solar storm hitting the planet such as the Carrington Event of 1859. I believe w

#BLACK SWAN

Release Date: December 31, 2021

STREAM ON Spotify / Apple Music / YouTube Music / YouTube (All Tracks)

I've spent quite a lot of time studying and modeling various hedging strategies to provide good downside protection against market crashes with the lowest possible cost. A couple weeks ago I think I finally found what I think is the best answer: long HYG puts. HYG is a corporate junk bond ETF. As a bond ETF, the volatility is typically very low (like ~7% IV) and this makes slightly OTM puts extremely cheap, especially when overall market volatility is low. But as a corporate bond ETF, it sharply tanks during times of credit crisis since the risk of default goes way up. You can see this mean divergence behavior on the attached chart.

HYG price history since 2007

This makes it an ideal candidate for black-swan hedges by buying OTM long puts on a monthly basis. And I'm not the only one who thinks so -- look at the MASSIVE open interest on OTM puts:

https://preview.redd.it/vjptkvudp0081.png?width=1530&format=png&auto=webp&s=e988c10ad41e1742c4d06a25e619f0c31772f20f

Anyways, hope this is helpful!

Read Part One Here

Notes:

• Time Period Analyzed: 11/27/2020 to 2/19/2021
• Options data was pulled from contracts that had expiration dates from January 8th until February 19th, 2021.

Disclaimers and Constraints:

• This information does not constitute financial advice.
• The information used in these analyses was extracted from chartexchange.com and is available to the public.
• The total amount of calls and puts for the period analyzed is understated: there is volume for calls and puts that were purchased and held (open interest) for contract expiration dates later than February 19th 2021. This statement is especially true for out of the money puts that were purchased on January 26th, 27th, and 28th of 2021 for contracts that expired after February 19th 2021. This part of the analysis will be conducted in a separate post (part 3) as it brings to light an important phenomenon that did not happen prior to the black swan event - the abundant purchasing of OOTM puts at < $5 strike prices.

Call and Put Open Interest (OI)

Notable Dates on This Graph:

• Highest Call Open Interest: 2/05/2021 (337,659)
• Highest Put Open Interest: 1/29/2021 (927,907)

Ratio of Open Interest of Calls vs Puts

General Observations:

• As noted in the previous graph above in addition to this graph, the ratio for the observed period overwhelmingly favors puts. There are only two dates where calls open interest have a higher ratio than puts.

Notable dates on This Graph:

• Highest % Ratio of OI Calls:
  • 11/27/2020 (57.15% of total open interest was calls)
  • 1/5/2021 (53.7% of total open interest was calls)
• Highest % Ratio of OI Puts:
  • 1/28/2020 (80.62% of total open interest was puts)
  • 2/1/2021 (80.73% of total open interest was puts)

Comparing Call and Put Volume vs Call and Put Open Interest

Genera

Notes:

• Time Period Analyzed: 11/27/2020 to 2/19/2021
• Options data was pulled from contracts that had expiration dates from January 8th until February 19th, 2021.

Disclaimers and Constraints:

• This information does not constitute financial advice.
• The information used in these analyses was extracted from chartexchange.com and is available to the public.
• The total amount of calls and puts for the period analyzed is understated: there is volume for calls and puts that were purchased and held (open interest) for contract expiration dates later than February 19th 2021. This statement is especially true for out of the money puts that were purchased on January 26th, 27th, and 28th of 2021 for contracts that expired after February 19th 2021. This part of the analysis will be conducted in a separate post as it brings to light an important phenomenon that did not happen prior to the black swan event - the abundant purchasing of OOTM puts at < $5 strike prices.

Daily High Stock Price vs Max Option Strike

Notable Dates on This Graph:

• 1/13/2021: The stock price nearly doubles (+89.46%) but market makers only increased the max strike by 25% (from 40 to 50). At this point, the daily high was 77% of the max strike price, which was unprecedented for the time period analyzed up to that point. This date is also important as the daily stock volume increased almost 20x (1946%) along with a massive increase in call volume (+1065.87%) and put volume (+1845.14%) respectively.
• 1/22/2021: The daily high of the stock price ($76.76) passes the maximum strike of 75, thereby making every single call on that date in the money (ITM) for a short period of time. In premarket on 1/25/2021, the price pushed to $136.
• 1/25/2021: The daily high of the stock price ($159.18) once again passes the now doubled maximum strike of 150, once again making every single call on that date ITM for a short period of time and later that day the price is promptly shut down to 50% of the maximum price to a low of $75.51.
• No other dates observed does the daily high stock price pass the maximum strike price, but there were close attempts on 1/26/2021 and 1/27/2021.
• On 1/29/2021, market makers set the options strike price to its maximum of 800 for options for the remainder of the time period analyzed

I've seen a lot of fear recently based around an accelerated FED taper and a stock selloff taking down the crypto market. While I don't want to discount this possibility, I have done some DD and think there is a really interesting historical comparison to be made.

In the words of Michael Saylor, Bitcoin is digital gold. It is the most sound money ever created, and its fundamentals are even better than those of the original physical gold. It has a finite supply which is completely transparent to everyone, it can be carried with you anywhere just by knowing your key, it is infinitely divisible, and it can be easily used as payments with Lightning or even on chain for large transactions.

If we believe that it fundamentally is a gold 2.0 and sound money (as I do), then it would make sense to compare it to gold during a market crash. We haven't ever had a real recession during Bitcoins existence, so let's take a look at the next best thing.

Here is a chart of gold during the late 2000s and early 2010s.

As we can see, while gold corrected around 30&#37; initially, it then went on its biggest parabolic rally yet as investors transitioned to risk-off assets.

Let's look at how that compares to what stocks were doing during the same time.

The stock market was absolutely destroyed, and unlike gold, took over 5 years to even recover. Obviously in the long run it went to the levels we see now, but it had completely brutal losses compared to gold and lagged in recovery both by time and by speed.

When companies miss revenue, houses get foreclosed on, and the velocity of money slows down, gold just does its thing. It never relied heavily on the economy to be a sound form of money, and neither does Bitcoin. Bitcoin also will just continue doing its thing during an economic crisis. Block every 10 minutes, 6.25 per block, hash rate goes up. Nothing more nothing less.

Most rich people, and businesses, are not dumb. Aside from what all the news companies may say, Bitcoin is not fundamentally a 'risk-on' asset, and I can guarantee that there are many wealthy people behind the scenes who already recognize that. Its volatility has been trending down and will continue to do so. It now has over a decade of

Read Part One Here

Notes:

• Time Period Analyzed: 11/27/2020 to 2/19/2021
• Options data was pulled from contracts that had expiration dates from January 8th until February 19th, 2021.

Disclaimers and Constraints:

• This information does not constitute financial advice.
• The information used in these analyses was extracted from chartexchange.com and is available to the public.
• The total amount of calls and puts for the period analyzed is understated: there is volume for calls and puts that were purchased and held (open interest) for contract expiration dates later than February 19th 2021. This statement is especially true for out of the money puts that were purchased on January 26th, 27th, and 28th of 2021 for contracts that expired after February 19th 2021. This part of the analysis will be conducted in a separate post (part 3) as it brings to light an important phenomenon that did not happen prior to the black swan event - the abundant purchasing of OOTM puts at < $5 strike prices.

Call and Put Open Interest (OI)

Notable Dates on This Graph:

• Highest Call Open Interest: 2/05/2021 (337,659)
• Highest Put Open Interest: 1/29/2021 (927,907)

Ratio of Open Interest of Calls vs Puts

General Observations:

• As noted in the previous graph above in addition to this graph, the ratio for the observed period overwhelmingly favors puts. There are only two dates where calls open interest have a higher ratio than puts.

Notable dates on This Graph:

• Highest % Ratio of OI Calls:

  • 11/27/2020 (57.15% of total open interest was calls)
  • 1/5/2021 (53.7% of total open interest was calls)

• Highest % Ratio of OI Puts:

  • 1/28/2020 (80.62% of total open interest was puts)
  • 2/1/2021 (80.73% of total open interest was puts)

Comparing Call and Put Volume vs Call and Put Open Interest

General

Notes:

• Time Period Analyzed: 11/27/2020 to 2/19/2021
• Options data was pulled from contracts that had expiration dates from January 8th until February 19th, 2021.

Disclaimers and Constraints:

• This information does not constitute financial advice.
• The information used in these analyses was extracted from chartexchange.com and is available to the public.
• The total amount of calls and puts for the period analyzed is understated: there is volume for calls and puts that were purchased and held (open interest) for contract expiration dates later than February 19th 2021. This statement is especially true for out of the money puts that were purchased on January 26th, 27th, and 28th of 2021 for contracts that expired after February 19th 2021. This part of the analysis will be conducted in a separate post as it brings to light an important phenomenon that did not happen prior to the black swan event - the abundant purchasing of OOTM puts at < $5 strike prices.

Daily High Stock Price vs Max Option Strike

Notable Dates on This Graph:

• 1/13/2021: The stock price nearly doubles (+89.46%) but market makers only increased the max strike by 25% (from 40 to 50). At this point, the daily high was 77% of the max strike price, which was unprecedented for the time period analyzed up to that point. This date is also important as the daily stock volume increased almost 20x (1946%) along with a massive increase in call volume (+1065.87%) and put volume (+1845.14%) respectively.
• 1/22/2021: The daily high of the stock price ($76.76) passes the maximum strike of 75, thereby making every single call on that date in the money (ITM) for a short period of time. In premarket on 1/25/2021, the price pushed to $136.
• 1/25/2021: The daily high of the stock price ($159.18) once again passes the now doubled maximum strike of 150, once again making every single call on that date ITM for a short period of time and later that day the price is promptly shut down to 50% of the maximum price to a low of $75.51.
• No other dates observed does the daily high stock price pass the maximum strike price, but there were close attempts on 1/26/2021 and 1/27/2021.
• On 1/29/2021, market makers set the options strike price to its maximum of 800 for options out for the remainder of the time period analy