Blackrock Crisis Part 4 via /r/wallstreetbets #stocks #wallstreetbets #investing


Blackrock Crisis Part 4

Is BLK still going to 0?

TLDR: Yes.

Part 1 Part 2 Part 3

Oh Blackrock, you big beautiful fucked bastard, I am so excited to buy up all your shit with the money I make on you on the way down.

Quick summary of 1-3:

Blackrock is a equity holding giant, the vast majority of their revenue comes from that little MER section at the bottom of the ETF description that you idiots never read. They hold 40% of their crappy overvalued holdings internationally and a boat load of that is worthless Chinese equities and properties. Blackrock owns the world and the world is overvalued. How is China looking since my last post? Not so good huh? A bit of a relief rally during last week’s quad witch party was nice for some BABA holding degens, but lets be clear… China is fucked. Since my last post we have seen new lockdowns and a 2008 style sell off as a result. Granted it was gobbled up when the CCP announced they were going full JPOW but we’ll see how that goes.

All in all Blackrock has been bleeding out for months and as you can see in part 2 I circled this week as a nice little buying opportunity for you guys. I sold some of my April puts around $680, and just went all the way back in gorilla style today for May dated OTM puts.

This week we’re talking about BONDS:

The bond market is rattled at the fed for raising rates too slowly. Last time we talked about how the mortgage rate was moving independently from the real rates, time to look at those pesky yields. Blackrock like another asset manager works with leverage, therefore they have to paying off debt on the majority of their holdings. As yields increase the payments to service that debt increases and with the majority of its revenue coming from that tasty MER or a percentage of their investment holdings their ability to service that debt is dropping and will drop much further as equities and assets continue to correct. Take a look at what the 10 yr is up to recently:

https://preview.redd.it/s6ckgqnp2so81.png?width=1845&format=png&auto=webp&s=369fcd2bd283766ca0e29fc7a88e7c8e374895c0

Good luck paying off that debt during the upcoming recession. Oh and if oil ripping up 50% wasn’t a good enough recession indicator how about the yield curve. If you’ve never heard of anything before you won’t know that yields are supposed to go up the longer the maturation period. i.e. 1<2<5<10<20<30 At the time of writing this Bond yields are:

2yr: 2.107%

5yr: 2.312%

10yr: 2.299%

20yr: 2.647

30yr: 2.523

So far the 5 and the 10 are inverted as well as the 20 and the 30. The classic ones to watch though are the 2 and the 10, so lets check those out:

https://preview.redd.it/bn4gzjb73so81.png?width=1843&format=png&auto=webp&s=7a81d8b375f6d04389e0de148a2c383a9156c875

Oof… Give it a week or two and we’ll see the inversion.

Last little chart to take a peak at even for dummy bulls who think we’re back on easy mode. Here is BLK and SPY from 2018. You can see even though spy had a bit of a rally before the bid dump at the end of the year, BLK was pretty much a steady blead all year.

https://preview.redd.it/ekq10k5n3so81.png?width=1850&format=png&auto=webp&s=1237e8a02206c2cb103685b9f7b3da9553b9f948

TLDR: Buckle up. we’re dumping.

Positions: INB4 yeah last week was ass, but sold the last of my other positions in my gambling portfolio and dumped them in to buy the put dip.

BLK Apr 14 22 630P

BLK May 20 22 650P

Submitted March 21, 2022 at 07:27PM by Nolan4sheriff
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