12 Aug

CPI read

US inflation (CPI measure) was 5.4% annualized in July, a rate unchanged from the previous month and fractionally above expectations.

Crude stocks were marginally less down than expected.

The Senate passed a $1T (i.e. $1MMM) infrastructure bill, with cross party support. A federal budget …

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11 Aug

Inflation

It seems fairly obvious that if the currency is rebased, inflation will occur. If the govt. announces that each pound in your bank account will be multiplied by ten overnight, the price of everything will rocket. Well, not everything. Your mortgage will suddenly have got a lot …

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10th Aug

Markets

I haven’t posted daily recently. I’m too busy with RL. But the trend seems embedded: commodities down, dollar up, yields down, curves flattening, inflation transitory, rates heading to zero (real rates -2%). Equity markets lack direction. The accepted cause seems to be the dreaded Delta …

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9th Aug

Tacit knowledge

When I was quite young, I must have seen some sort of TV interview of Hermann Bondi, then the master of a Cambridge college. He said something which resonated with me, which is that in some sense we have an instinctive grasp of Newtonian mechanics. A …

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6 Aug

Are you late to the tech party?

The time to be bullish tech was two months ago (outlined here), but back then people were busy puking tech.

Not overly surprising, but the latest big tech melt up has forced people into buying quality tech up here. Chasing tech …

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5 August

Evergrande may just be the first roach in the kitchen

the regulatory directive says that banks should stop lending to heavily indebted local-government financing vehicles (LGFVs), companies set up by city or provincial governments to finance building projects and public works. The groups, which have not so far …

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4 August

Nobody trusts this market

One of the topics over past weeks has been the extreme bid in protection vs what the market actually is doing. We have had a few sharp moves lower, but that was “fixed” in 24-48 hours.

While 3 month realized vols have trended small …

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3 Aug 2021

Oil becalmed

Open interest in oil futures is dropping rapidly. Basically, all markets, from gold to oil to USTs are settling on an disinflationary thesis.

I can’t help thinking that this will spill over in emerging markets debt, i.e. that we’ll soon see the …

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1 Aug

Sandridge Energy and Baytex Energy

Bison Interests are keen on these two. Highly geared, but benefiting from rising demand. You’ll have to listen to the lastest episode of the Market Huddle to get the detailed thesis. Or search for Josh Young on Seeking Alpha.

House prices, globally …

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28 July ‘21

Earnings set to rocket

Analysts’ forecasts for earnings, which are typically for 3-5 years, are more backward looking than forward looking. What goes up like a rocket tends to return to earth quite smartly.

Inflation expectations

Like a lot of people, I tend to think of the …

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