Nvidia crushed earnings.

Micron put up numbers that would make most CEOs weep with joy, data center revenue tripling year over year.

Both stocks got hammered.

When phenomenal results get sold, you're not in a stock market anymore. You're in a liquidity event.

I've been talking about this for weeks now, and I hate to keep beating the drum, but the pattern keeps proving itself out: This sell-off didn't start with Iran.

It didn't start with tariffs.

It started in October with crypto, rolled into high-beta AI names in November and December, and now it's working through every asset class like a virus that mutates faster than you can treat it.

The Tap on the Shoulder

I've been through enough crises to know what this looks like from the inside. A portfolio manager sits at his desk. He's got Micron trading at 3.7 times 2027 earnings. The fundamentals scream buy. He walks into his boss's office and says the story is great.

His boss says: "Sorry, that's not what this is about anymore. It's about raising money."

That's the tap on the shoulder. Once it starts, fundamentals stop mattering. Torsten Slok at Apollo warned about this back in October 2024 when he pointed out that global equity markets had essentially become one giant leveraged Nvidia trade. Every fund owned it. Every retirement account was exposed to it. The concentration was historic.

Now the unwind is here. And it's not just stocks.

Private Credit Is the Next Domino

Jeffrey Gundlach at DoubleLine has been screaming about private credit for months. He compared the sector to subprime mortgage repackaging in 2006. The private credit industry got flooded with redemption requests that blew past the standard five percent quarterly gates. Apollo capped withdrawals from its flagship fund after investors requested about 11 percent of total assets.

Here's the math that should scare you. When investors asked for 15 percent of their money and got five, what do they do next quarter? They ask for 100 percent. Because now they know the gates are real. Redemption demands are expected to outpace new investments by two-to-one this year.

People keep saying "Oh, it's only two trillion." That's what the housing market was. Fifteen years later, but that's what it was.

What I'm Watching

The risk gauge I follow, run by a friend, just hit 96 out of 100. I've never seen it that high. The MOVE index, which tracks bond market volatility, nearly doubled from February levels. iShares iBoxx High Yield Corporate Bond ETF (HYG) was already in trouble before Iran. Financial Select Sector SPDR Fund (XLF) was already breaking down. VIX was already elevated.

Don't be fooled into thinking Iran is the whole story. We know something else is going on here. The liquidity squeeze started months ago. Iran just poured gasoline on it.

If we get an Iran resolution and the rally fizzles after a few days, I'd be buying tons of protection. That would tell you the structural problems run deeper than geopolitics. A real bottom needs more than a headline. It needs the plumbing to work again.

Here for a good time AND a long time,

Hans