UK Forced to Pivot Back to QE
The US and the UK are tightly tied together from a policy perspective, so understanding UK problems is extremely helpful for portfolio positioning. The UK 10-yr bond has dropped an incredible $28 since Aug.1. The US 10-year, which seemed like it was in free fall, is down $11 over the same period. The panic selling […]
Powell Wins This Round … What’s Next?
Hey There Income Hunter, Jerome Powell finally got what he wanted. But there’s a reason they say be careful what you wish for. It may be time to put on your crash helmet. The VIX finally crossed 30. In many parts, they have some colorful language for that barrier. When we get above 30 VIX, […]
Where Do We Go From Here, J-Pow?
Today’s trade was similar to yesterday from an option flow perspective … Market opened down on terrible news out of Germany showing still very high inflation. Interest rates spiked much higher on the news and that spilled over into the US as the US 10-year spiked above the June high. Bonds are signaling load and […]
Stocks vs. Bonds: It’s Easy!
For decades there was never much choice between whether you hold stocks or bonds in your portfolio … It was a very easy decision … You would hold 60% stocks and 40% bonds. What made the 60/40 portfolio work so well for 40 years was that the US had natural buyers for as many Treasury […]
FedEx Sets the Mood for the Fed
Powell has a bit to stew on over the next few days before he takes the stand on Wednesday to announce another .75% rate hike … Well, at least .75%. That is a given, and the market has further priced in a 1-in-5 chance of a full-point hike. It’s important to remember this will be […]
Will Powell Throw This Dog a Bone?
Hey There Income Hunter, As expected, this week turned out to be a wild one. It started with bond supply that was not easily digested … Then was slapped around by the upside surprise in CPI … And ended with Fed-ex earnings warning from FedEx. The weak economy/high Inflation scenario continues to dominate the market […]
Retail Sales and Labor Union Strength
Hey There Income Hunter, Two important events the past couple of days are signs inflation may remain high while growth continues to slow down. Retail sales initially showed a rise of 0.3% in August, as consumers spent money on new cars and eating out more. (I know I have, and I am stuffed.) Although adjusted […]
Energy Crisis Causing Insanity
Hey There Income Hunter, Well, it appears we found one politician who can’t make money trading. How about the Biden report stating the administration is willing to pay $80 for oil today … But Democrats passed on buying it at $24 when Trump proposed building reserves at that price. You know what’s going to happen […]
Huge Upside Surprise for CPI
Hey There Income Hunter, Well, as we have seen all year, whenever the market is leaning one way … take the other side of the bet. After the rally we have had the past week, the market was sure we would get a weaker CPI print … but instead, the food component printed […]
Treasury Bond Buyers Strike
Hey There Income Hunter, It seems like many disgruntled employees are talking about strikes these days. Well, add US Treasury bond buyers to that list. The second week of each month is the week the Treasury issues 3-year, 10-year and 30-year bonds … Yesterday, there was a double, with both 3-year and 10-year on the […]