Reappointed Powell Is Less Hawkish (Already)
Hey There Income Hunter, The J-Pow moonwalk has begun. This week, Jerome Powell was officially reappointed for another term as Federal Reserve chairman, and in an interview afterwards he made two comments that revealed he is already hedging his ultra- tightening remarks … “If the economy performs about as expected,” Powell said, […]
Commodities Capitulation Day
Hey There Income Hunter, The losses are starting to mount. Internet and tech-heavy investment firm Tiger Global has bled $17 billion so far in 2022 … Japan-based SoftBank reported a $27 billion loss this week … And this is just the beginning. There will be many more stories like this to come. Now, we did […]
Fed Gets No Love From CPI
Hey There Income Hunter, The Fed desperately needs help getting inflation down but yesterday’s headline (all items) and core (all items minus food & energy) CPI numbers were both higher than expected. Elevated levels of inflation will continue to destroy consumer demand and tighten financial market conditions … And we are starting to see the […]
Real Money Starting to Liquidate
Hey There Income Hunter, Monday’s trade had a feel of real money liquidation, as if guys got a tap on the shoulder to get out. Yesterday’s trade probed the downside but held around this monster S&P 500 4,000 level. (The 4,000 level is by far the largest open interest strike across all strikes.) Now, real […]
Bond Curve Warning: Trouble Ahead!
Hey There Income Hunter, Loyal Power Income readers know the value of paying close attention to bonds because they are a predictor of future economic activity. Like pro bond traders, many of you watch the Fed closely … and it doesn’t take too long to figure how inept our central bank really is. […]
How Low Will It Go?
If you love volatility, then you were loving last week’s price action. Fed weeks are rarely boring and this one included a mini-vol crush and rally on Wednesday followed by a historic all-out real money liquidation of financial assets on Thursday. Tech swung from the biggest rally in years to the biggest selloff in years. […]
Hangover Day After the Powell Party
Hey There Income Hunter, We know Jerome Powell needs asset prices to go lower to help the Federal Reserve drive inflation down. When stocks and bonds are lower in price (and, woof, the bond market), it tightens financial conditions for Powell and may keep the Fed from having to do some heavy lifting. […]
Powell Finally Gets Real
Hey There Income Hunter, As predicted, yesterday’s Fed meeting replicated the March event with a short-covering rally. This one may have similar staying power as well. All it took was a simple answer to a question on a 75 basis point hike at the June meeting … Powell did not hesitate to say that it […]
Powell’s Mission Impossible
Hey There Income Hunter, Well, hopefully J-Pow got a good night’s sleep last night because today he could not be facing a worse environment than he is right now … It does not get any worse for an economy than negative GDP and historically high inflation … >> But it’s great for […]
Big Reversal .. The
Hey There Income Hunter, The SPDR S&P 500 ETF Trust rotated down to the 405 area yesterday, with the implication that there is support there, thanks to very large open interest in puts and calls at the 400 strike. Once that area held, SPY climbed back in the last hour of trading to […]