Note

I am not spending much time on this blog this week and next. I have personal stuff to deal with.

Wrap

The markets seem to be directionless. Gold is up a bit, Comex futures near month now over 1900. Bonds are up: 10Y yield down to 1.581%. Oil is practically flat, CRB is up 1%. Equities are practically flat: NDX up 0.1%, SPX down 0.2%. The dollar is weakening, back to 90. General flows seem to suggest this is a conviction trade.

Other news

There doesn’t seem to be much news. There is a lot of coverage of crypto, but I suspect that this is because of a lack of major international, financial or political news. A lot of commentators are focussed obsessively on the Fed. It seems to be using the reverse repo facility, heavily, to shift all those T-Bonds that it keeps accumulating back onto the banks balance sheets. How buying up a huge chunk of the market (after the primary dealers have taken their vig) only to loan it back to the banks again seems an worse than pointless activity.

Link to article quoting Zoltan.

Crumbs

• Excellent article on how the Fed started chopping inconvenient goods and services from the CPI basket in the 70’s.
• Fed starting to think about implementing CBDC.