Ceci n’est pas QE

Before jumping into some deeper thoughts on the stealth ~$500b balance sheet expansion the Fed announced last Friday, let me just make a few trading observations. First of all, I know I have been quiet lately. Since we touched 3000 in spoos and 1.75% in implied yields...

Backstops Over Accidents

There was very little new to chew on in either the FOMC statement or Jay’s press conference last week – and the market has reacted accordingly. That said, the meeting did offer up some dovish fodder, which I don’t think was fully appreciated by the masses. First, many...

Draghi crushes the resistance; will Powell follow suit?

So Draghi decided to wait until his final meeting to stand up to Berlin. He has certainly had a majority for a long while to do much more in the ongoing fight against Japan-style disinflation. But for whatever reason, he never had the guts to fight the Chancellor!! I...

Kudos to Bill Dudley for his courage, honesty, and integrity

Bill Dudley just penned one of the most controversial opinion pieces every written by either a current or former Federal Reserve official. If you haven’t read it, please take the time to do so here. Bill is calling to action his ex-colleagues at the Fed to EXPLICITLY...

JOMO

I have been on the sidelines now for 7 weeks – no spoos, no blues, no seagulls, no 2s, no chartreuse, no Qs, no EM, no Dax, no Nikkei, no dollar, and most importantly NO WORRIES!! I have not had to deal with Fed flip-flops, CNY breaks of 7.00, Argy crashes, trade war...

No FOMO Here

It’s been 3 weeks since I temporarily parted ways with my long time love. But with spoos still around 3000, and cash 10s still around 2%, I’m feeling no FOMO yet for risk parity. Financial markets continue to feel well-priced for dovish FED and ECB expectations, which...

Rate Reduction -> Flow Reduction

As I watched Jay’s testimony from start to finish yesterday, I couldn’t help but think how incredibly smooth it went. There were no gaffes. There were no contorted explanations of the current policy stance. And there was absolutely no confusion about what was coming...
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