Mind The GAAP (Again)
Ok, so we pretty much covered everything worth mentioning regarding Monday’s session earlier. OPEC chatter notwithstanding, there’s really no good reason to do anything ahead of the Fed and the BoJ unless you think you have a pretty good read on the tone Yellen will strike in the presser and on what Kuroda intends to…
Bond Markets Are Feeling the Fear
Bonds are showing a higher volatility than the overall stock market. Let's see how this impacts the financial stocks and our current positions...
“Wait-And-See” Week Off To Aimless Start
Well, what can you say about Monday? We shot a terrorist, subsequently captured him, and GM got a key upgrade (USA! USA!). Other than that, it’s an aimless session. After a fast start, stocks drifted lower, then rebounded a bit, and then… you get the idea. The problem, apparently, is oil. Have a look: “They…
Levels to Trade By and Volatility on the Horizon
Here are the key levels this week to watch in the S&P. These key levels in the S&P will dictate order flow to all the major stocks you trade. With the Bank of Japan and the Fed announcing this week here are some of the trades to keep your eye on...
Previewing A Big Week: Fed, BoJ On Deck
Ok, so next week is obviously critical. We’ve got the FOMC and the BoJ and as we’ve tried to emphasize, the BoJ may actually be more critical than the Fed. The Fed has plenty of reasons to go “full-Brainard” as it were and forestall a second rate hike. They’ve got a weak non-manufacturing ISM number…
Irrational Complacency
Ok, so two things to wrap the week: bond yields and volatility. Both have been suppressed by central banks. Here’s what Citi said on August 30: “We have written recently on the distortionary effect of central bank action on asset prices. One of the most jarring manifestations of this is the persistently low implied volatility…
Deutsche Bank On The Brink, Refuses To Pay Department Of Justice
We’ve long documented the sad if sometimes comical demise of Deutsche Bank, the German behemoth that’s become synonymous with, how shall we say, “unscrupulous” business practices. The company replaced its co-CEOs last year including Anshu Jain, a man who a BaFin (that’s the German financial watchdog) once outed in a report as being a cheerleader…
AAPL Baking Shorts
AAPL shot higher again today taking the over all stock market with it. As well as taking out any shorts in its path. Let's look at some potential catalyst for the market. There is now only a 12% probability of rate hike next week the Fed. This comes after the ECB and the Bank of…
Suddenly, Everyone’s Talking About VaR Shocks Again
We’ve talked quite a bit lately about systematic strategies and about the dangers they pose to markets. We’re talking here about CTAs (trend followers), risk-parity, and vol. targeting. We dodged a bullet around Brexit when it came to CTAs. Here’s why: (Chart: BofAML) What that shows is that CTAs weren’t forced to liquidate as aggressively…
“They’re Just Too Polite And Timid To Say What The Wanna Say”
Well, we got a spate of good/cop bad/cop economic data out this morning. Jobless claims were basically in-line, but if you you’re a Lael Brainaird type and you’re looking for excuses not to hike, you can probably find a reason or three in the retail data, which missed, casting doubt on the supposed “strength” on…