Wall Street To Fed: Promise Us You Don’t Know What You’re Doing
“That’s a risk that we live with every day and we’re going to live with that every day for many, many years to come, so I think you can’t be on pins and needles and say I’m not going to pursue the right policy for the U.S. because something bad might happen in that situation.” […]
Brent Tops $50 On Hopes The Oil Rout Is Over – But Is The Move Sustainable?
Well, the big story today is again crude, as Brent topped $50 (before pulling back) putting pressure on the dollar in what will continue to be the most important market tug-of-war when it comes to how risk is bid. Earlier this month, I explained that everything seems to be trading off of oil, which isn’t […]
Is Someone Lying About Saudi Arabia’s US Treasury Holdings?
I’ve thought (and written) quite a bit about what Deutsche Bank called “quantitative tightening” last autumn. The concept, like many complicated-sounding ideas, is actually simple: countries hold reserves to guard against economic turmoil and when they sell those reserves in times of stress it amounts to the opposite of QE because those reserves are primarily […]
Here’s The Most Important Question For Risk: Whither The Yuan, My Friends?
Sometimes it seems like no one gets it when it comes to the Chinese yuan, which is really too bad because in many ways, what happens to the renminbi determines the direction for risk assets. Last August, the market was abuzz with news that Beijing had decided to let the market play a more active […]
It’s Cool To Be A Bear. Do You Want To Be Cool?
Earlier today, I asked the following question: “Where’s The Bull Market?” My point was simple. Central banks have indeed driven asset prices into the stratosphere and a kind of needlessly contrarian collective gamble has driven oil back near $50 even as the fundamental picture is so bad that crude is being stored offshore in tankers […]
Where’s The Bull Market?
If someone asked me to summarize my general outlook on markets – whether equities, fixed income, FX, or otherwise – in one sentence I’d say this: we are investing and trading in exceptionally uncertain times. Yes, that’s a cliche. But I think it’s an appropriate one in this case. To be sure, being bearish and […]
Morgan Stanley Warns On Oil: “The Market Is Not Healthy”
Ask analysts about crude’s rather dramatic rebound off of the January lows to nearly $50 and you’ll probably get a variety of answers referencing any number of data points that purportedly signal a shift in the supply/demand picture. Barclays, for instance, sees the market swinging to a supply deficit in 2017. But the reality heading […]
A Yen War Looms After Contentious Weekend In Japan
There’s probably no one in the world who wants the Fed to raise rates more than Japanese Finance Minister Taro Aso. Earlier this month, Aso threatened to intervene in the FX market if the yen continued to trade in a “disorderly, one-sided, speculative” manner. For those who haven’t followed the story, this is a big […]
King Dollar Has “Unfinished Business”
This week was about one thing, and one thing only: uber hawkishness from the Fed. To be sure, “uber hawkishness” means something entirely different today than it meant in the Volcker years. Now, you’re a hawk if you think the Fed Funds should be 75 bps. Still, it’s all relative. We live in a world […]
Why One Bank Thinks Emerging Markets May Be In Trouble
Let’s talk about emerging markets. Over the past five days, it’s become abundantly clear that the Fed was getting a bit nervous about the odds the market was assigning to a June rate hike. In short, it was readily apparent that virtually everyone assumed next month was a no go. The looming Brexit referendum only […]