Minskey Moment
A “Minsky moment” is a term in economics and finance that describes a sudden and severe market collapse. It’s characterized by a sharp drop in asset prices and a sudden shift in sentiment from bullish to overwhelmingly bearish.
The concept is named after economist Hyman Minsky, who studied financial instability and the cycle of optimism and risk-taking in financial markets.
The odds for a Minsky Moment within the next 12 months are around 70%, in my view. The exact trigger and timing are unknowable, but I see several potential black swans. Consequently, I think it’s a great time to be in cash and precious metals as we await the next opportunity.
