Peak Absurdity, Or, “A Sad Commentary”

It’s always dangerous to call a top in absurdity (“peak absurdity”, if you will), but if we’re not close to it by now when it comes to flip-flopping Fed predictions then we don’t know what peak absurdity might look like. As Richard Breslow put it last week: “Every market trading in lockstep is a legacy…

Sleepy Tuesday

So it’s a sleepy Tuesday, which is to be expected because God knows what went on in the Hamptons over the weekend. But the desks better get it together quick because as you all know, this is a big month. In fact - and this is a sad state of affairs- the fate of the…

Starting to Lean into Expected Rise in Volatility

The markets continue to hang on every word from the Fed. The Fed is very unlikely to change monetary policy until December. What that means is a continuation of historic low interest rates and no change in the status quo. However, let's review some exhaustion signs from the market and see what opportunities are ahead...

“Crude” Realities Rear Their Ugly Head

Well, you’ve gotta love crude. A while back - we’re not sure exactly how long, chalk it up to bad short-term memory - we noted that this was about to become another round of OPEC headline hockey, all of it completely meaningless except of course to the non-thinking algos that will simply buy/sell the “news”…

The Big Hedge Driving Markets

Free Online Seminar The Next Big Short with Don Kaufman Wednesday, September 7th at 8 PM New York Time / 7 PM Central https://theotrade.com/short/ Thanks to the Volker rule in the Dodd-Frank Bill big banks need to dynamically hedge their positions. This means when the market goes up they need to buy S&P Futures into…

Are We On A Path To De-Globalization?

One of the most important things to understand about the upcoming US election is that both candidates seem to be leaning towards adopting some manner of protectionist policies. For Clinton, it seems to be an outgrowth of her protracted battle against Bernie Sanders whose message about lost jobs resonated among large swaths of the electorate.…

“Eventually, Markets Have To Reflect Realistic Assumptions”

On Thursday in “Stop The Madness,” we highlighted some commentary that we think is broadly representative of how investors are thinking about markets these days. In a nutshell, the message is this: there’s so much cash floating around and no one knows where to put it because yields on everything from German bunds to investment…

Payrolls Post-Mortem: Just Good Enough, Or An Excuse To Wait For December?

We’re not much for conspiracy theories but come on. 151K on the jobs print? If the Fed was looking for “optionality” they certainly got it with that number. Yes, it was below consensus, but not by a large enough margin to completely rule out a September hike. The other side of that coin is that…

Critical Levels on the S&P - Doing it Live!

Today's trading day is a great example of having the ability to look over the shoulder of an experienced trader. Let's look at a clip from this morning's room session with Don Kaufman. Then if you'd like to join TheoTrade's live trading chat room here's a special (35% off) one time offer link to use:…

Exposing The Lie Behind “Efficient” Markets

We’ve talked tirelessly about how correlated and interconnected markets have become in the post crisis world. If you believe in the efficient market hypothesis, you believe - generally speaking - that asset prices always reflect available, relevant information. In other words, you can’t “beat the market.” It’s always going to “beat” you to the mark…