No One Knows What’s Going On Anymore

When you become so wedded to a market narrative that it becomes gospel, you are probably about to make a financial misstep. I’ve been a skeptic for years about the sustainability of what are increasingly artificial markets. Markets that rely for their viability, on a bid for equities that comes from somewhere no one really…

It May Be Time To Stop Blaming Central Bankers

“My message will be largely favorable, although recent developments have been mixed.” That’s it ladies and gentlemen. We’ve officially reached the nadir of Fed communication. Janet Yellen is now telegraphing what she is about to say in a speech which is itself ostensibly meant to telegraph something else. It’s a kind of bizarre evolution wherein…

Goldman: 100 Basis Points Equals One Trillion In Losses

On Friday, we got an abysmal NFP print. And that should have sent stocks soaring right out of the gate. As we explained here earlier today, bad economic news has traditionally been good news for equity investors and traders in the upside down environment that has largely characterized the post-crisis world. By the end of…

"So, Maybe July Then?”: Poor Jobs Report Puts Question Mark Over Fed

Bad news is good news. Or not. The market’s reaction to Friday’s NFP report betrays the extent to which investors and traders no longer have any idea how to read the Federal Reserve. There was a time when negative data was a guaranteed boon for risk. The worse the data, the better for stocks. Why?…

Positioning For A Rate Hike: Let’s Look At Valuation, Sentiment, And Flows

I like talking to traders. I no longer classify myself as one, but there was a time when I was a card-carrying member of the club. Nowadays, I like to look at the macro picture and try to discern whether there’s something big on the horizon that will ultimately encompass all asset classes and thus…

A Cautionary Word About Trading And Policymakers On An OPEC, ECB Thursday

I want to talk a bit about perceived policymaker ineptitude today in the wake of the OPEC and ECB meetings, both held in Vienna. First, let’s do the headlines: we got nothing in the way of an agreement out of OPEC and no policy change from Draghi. To be sure, both of those outcomes (or…

“Yen”-sanity: Markets Swoon At The Open After Japanese Currency Soars

On Friday, I outlined how Japan’s FX Catch-22 could end up weighing on US equities. Make no mistake, it’s an important dynamic to understand. Generally speaking, risk moves opposite the yen and there’s also carry unwind when the JPY moves higher. One hot topic in Japan recently has been Prime Minister Shinzo Abe’s plan to…

In Epochal Shift, Saudi Arabia Readies International Bond Sale

Something important happened today. The ubiquitous “people familiar with the matter” confirmed that Saudi Arabia is set to tap international capital markets for the first time in a bond sale worth as much as $15 billion. Although the Gulf’s budget crunch began making front page financial news (finally) late last year and has been a…

Fed Summer Survival Guide

Ok, so it’s Tuesday, which might as well be Monday thanks to the US and the UK being closed yesterday. I don’t mind penning “news-ish” market updates, but as regular readers here are probably aware, I prefer to outline my take on market themes or macro trends that I think matter from a big picture…

Citi Comes To LendingClub’s Rescue, But You May Want To Fade This Rip

If you want to find examples of people making really ill-advised decisions that not only seem silly in retrospect, but also at the exact moment they’re made, the stock market is a great place to start looking. We got a perfect example last week in shares of LendingClub, the beleaguered marketplace lender that’s suffered through…