European coronavirus update and its implications
I have been watching the third wave make its way across Europe and reading the European press to get a sense of how bad it is. And it definitely looks like another lost quarter for Europe. I really like how comprehensive the coverage in the…
Covid-19 waves, EM canaries, and large cap tech optionality
As the new week begins, I have three subjects I am focused on. The first is the coronavirus, where the mutant-inspired infection wave I have expected is forming. The second is emerging markets, where the increase in the US dollar is…
On the Fed’s playing chicken with the bond vigilantes
Yesterday the US Federal Reserve Open Market Committee released a policy statement that it has decided to stay the course on accommodative monetary policy through zero rates and quantitative easing. It provided absolutely nothing in terms…
Short-covering in Treasuries and a third wave in Europe
I expect to see more of the bear market in bonds in due course. Eventually, I think it's the sell off in Treasuries that will force the Fed's hand. But right now, that is a crowded trade. We've got some negative Covid-19 data out of Europe…
Three Market Narratives
After the last week off, let's see if we can get back into the flow here. And my apologies for ghosting you. I was overcommitted last week against a backdrop where there was less to say.
In the interim, though, I have seen three market…
The return of the reverse radical recovery
Jobs day in the US in 2021 will be the same for me today for the third month running. It's all about the start and stop nature in the leisure and hospitality sectors due to the pandemic. Underneath those shifts, the reverse radical recovery…
The US economy firing on all cylinders? Hardly
In the week ending February 27, the advance figure for seasonally adjusted initial claims was 745,000, an increase of 9,000 from the previous week's revised level. The previous week's level was revised up by 6,000 from 730,000 to 736,000.…
Some forward-looking views on the economy and bonds
I think we're close enough to the end of the Covid era to start talking more about what happens when this period is over. By that, I don't mean that COVID-19 is over as a major public health threat. I mean more that the period of time when…
When will central banks lose control of bond markets?
I have two subjects on my mind today. One is interest rates and the other is equity markets. I wrote a brief Twitter thread on how I'm thinking about this here. But let me spell it out more granularly now.
Rates driving volatility
Interest…
Explaining my shift in tone briefly
I have an interview with Mark Ritchie coming up in an hour and I wanted to write a specific post about the changing tone on Credit Writedowns because of it. I last spoke to Mark in June. And he was a wide-eyed bull, telling me that the 3-…