The VIX has touched 9.40 three times since 1990.
- December of 1993
- December of 2006
- June 2017 to present
What is interesting about these dates? They all precede the build up of a financial crisis of some kind.
Take December 1993, the VIX briefly touched a low of 9.31,
3 years and 7 months later the East Asian financial crisis took place.
5 years and 8 months later the Ruble Crisis leading to Russia defaulting on its debt.
7 years and 3 months later the $QQQ hit an all time high which ended the Dotcom Bubble.
The VIX surpassed the low of December 1993, hitting 8.60 on December 2006,
10 months later the Sub-prime mortgage crisis was beginning as the $SPY peaked.
1 year and 9 months later Lehman Brother collapsed.
I know the VIX as the fear index. In respect to that could it be that a lack of fear in the financial markets drives poor risk-management and inevitably leads to a crisis?