S&P 500

S&P futures point to a slightly lower open, while Asian and European stocks are likewise modestly in the red. Trading volumes are muted for most markets on Monday with investors spooked by rising geopolitical tensions in the Middle East and the Korean peninsula. It is also a holiday-shortened week in much of the West. As Bloomberg puts it, there is a "sense of unease" across markets, with global stocks mixed as investors weighed looming security risks and French bonds retreating ahead of the election following the surprising surge of far-leftist Melenchon in the polls.

We start the week with some market musings from one of our favorite cross-asset commentators, Bloomberg's Richard Breslow who looks at the aftermath of last Friday's "face-ripping" moves and says "you can't help but marvel at the key-day reversals in one asset class after another -- often a powerful sign of a new direction in prices" yet which provide no confidence to any traders for the simple reason that not even the Fed has any idea what is going on: "it doesn’t help that we’ve seen all of these levels before. Experienced all of the same emotional swings multiple times.

I am not a particularly big fan of the idea that markets are efficient. In fact I think people who believe this have never spent any time working in investment management. Everyone in the industry has seen how investment fads wash over the industry from time to time, only to wash out again as returns begin to disappoint.

    - Russell Clark, CIO of Horseman Global

In today's excerpt from Eric Peters Weekend Note to clients, the CIO of One River Asset Management focuses on the one topic that is first and foremost on the minds of the active investing community: the unprecedented shift from active to passive management, and what it means for not only the industry, but for markets during the next "normal correction."

Authored by Pater Tenebrarum via Acting-Man.com,

Counterintuitive Moves

Something odd happened late in the day in Wednesday’s trading session, which prompted a number of people to mail in comments or ask a question or two. Since we have discussed this issue previously, we decided this was a good opportunity to briefly elaborate on the topic again in these pages.