System Of A Down

Fly Charts: Understanding the Market Plunge Edition

From the falling market's impact on M&A to a bunch of other charts on the market dip, here are four charts that tell you what you need to know in business today.

Good morning! This is Fly Charts, the daily charts-only newsletter from Gadfly; sign up here. From the falling market's impact on M&A to a bunch of other charts on the market dip, here are four charts that tell you what you need to know in business today.

20/20 Vision

The return of major volatility is unpleasant for many, but does give some much-needed negotiating power to investors in IPOs and stock sales.

Source: Bloomberg

Not Such a Bad Start

Context matters. As bad as this plunge looks in the moment, there have been many worse starts to trading years.

Source: Bloomberg

Overheated

The current market rout -- which is occurring smack dab in the middle of a nice earnings season -- may put a damper on the recent trend towards record-high takeover valuation.

Source: Bloomberg

Lofty CAPE

The S&P 500 would have to fall an additional 52 percent to reach its long-term average valuation. Bulls have nothing to panic about yet, and bears have not been vindicated.

Source: Website of Robert Shiller

And don't miss Tim Culpan on the other crash going on right now: "If the price doesn't rise, then the average miner is set to lose $3 per week at current levels. Mining syndicates such as Antpool -- which are probably buying their mines at less than the retail price -- may still be making money, but will be getting returns 90 percent lower than they would at that 50-day moving average. The only way for miners to return to sustained profits is if Bitcoin prices rise, or some miners turn off the lights, lowering competition. History shows that while the latter is possible, it's unlikely. In fact, those who have plunked down millions of dollars to build their Bitcoin mining operations seem to be playing chicken in the hope that competitors will flinch."

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

    To contact the author of this story:
    Max Nisen in New York at mnisen@bloomberg.net

    To contact the editor responsible for this story:
    Mark Gongloff at mgongloff1@bloomberg.net

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