By now it is clear that we are in the throes of a historic market sell off. Money is flying off the table at a record-breaking pace and it's affecting everything from stocks to bonds to commodities to cryptos.

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One of my colleagues asked a really smart question yesterday if everything is selling off where is the money actually going?

We know that in most major market sell-offs other assets tend to rise in relation. Gold is usually a benefactor as it is seen as a safe haven and hedge. Many times the US Dollar and the Japanese Yen will rise as stock investors move to hold cash.

In this case, everything is just falling. The answer is that it doesn't go anywhere it simply disappears.

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Let's think about Market Cap. This metric is calculated by multiplying the total number of shares by the current value. So, if Apple is worth $180 per share and there are 5 Billion shares so we get to a market cap of $900 Billion. ($180 X 5 Billion)

Here's the fun part. Let's say there are only two people on the floor of the NYSE today and one person wants to sell his shares but the other guy doesn't want to buy. The seller will have to keep lowering his price until the buyer agrees to pay for it. If the price they place the trade is $160 then that becomes the market price.

We then adjust the entire Market Cap to incorporate the current price to ($160 X 5 Billion) $800 Billion. Boom!

With one trade everybody holding apple lost money and the company itself lost $100 Billion worth of value.