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…

Margins Or Buybacks: What’s Really Driving S&P EPS Beats?

While perusing FactSet’s “Thought Leadership” section on Friday I ran across something interesting. There’s a narrative out there about buybacks that’s been propagated by a variety of outlets over the past 12 or so months that ties ZIRP and share repurchases to equity strength. To be sure, it’s a compelling argument. Here’s how it goes.…

Calls For “Helicopter Money” Grow As G7 Meeting Betrays Global Growth Jitters

Finance chiefs from the G7 economies are meeting in Japan this weekend ahead of next week’s G7 summit. At the top of the agenda: sluggish global growth. As anyone who follows global macro is acutely aware, Japan is in many ways the poster child for subdued economic activity. Last year, the country received the rather…

Here’s What To Watch Ahead Of The All Important June Fed Decision

Well, here we go again. Both crude and stocks got off to a rocky start on Thursday as the Dow plunged triple digits and oil fell more than 2.5%. The culprit: why, the Fed of course. This week has reinforced the market themes that have played out for most of this year. On Monday we…