Earthquakes don’t announce themselves. They build quietly, pressure mounting beneath tectonic plates until one day — snap. Markets have their own version of this: Riskquakes. Sudden shifts that look “out of nowhere,” but in hindsight were rumbling all along.
Think back to the 2008 housing crash. On the surface, things looked fine. Homeownership was at record highs, Wall Street bonuses were flowing, CNBC anchors were beaming. But underneath? Adjustable-rate mortgages were resetting, leverage was spiraling, and credit default swaps were multiplying like rabbits in spring. The tremors were there — just not in the headlines.
Here’s the tricky part: most investors are terrible seismologists. We stare at the surface — quarterly earnings, Fed speeches, meme stock chatter — instead of the hidden fault lines. But markets don’t crack at the surface first. They crack where stress accumulates unseen: liquidity mismatches, shadow portfolios of correlated bets, fragile supply chains stretched thin.
The lesson isn’t paranoia — it’s awareness. You can’t predict every Riskquake. But you can watch the pressure zones. If spreads widen while sentiment stays calm, if your gut says something feels wobbly — pay attention. That’s your early-warning system.
🔗 Want proof? Read about how the Financial Crisis Inquiry Commission dissected the run-up to 2008 here. It’s a masterclass in missed tremors.
Markets, like the earth, are never truly still. The only question is whether you’re prepared to notice the tremors before the shake.
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