Crumbs

• Seems like risk on. Commodities up, dollar down a bit.
• EM equity markets are dominated by tech and discretionary (e.g. automotive). Not commods!

• But, but stonks never go down!

• 

• Great timing

• (Worthington Industries) $WOR is a steel play. It’s a big purchaser of steel and fabricator of materials for construction. Seeking Alpha Report
• inequality really has zoomed up since 1980.

Steepening

This wonderful chart, from Alex Manzara got me thinking today.

There seems a clear trend of steepening established around 27 Aug 2019. In a chart as compressed as the one above, it’s not clear how much daily noise there is in this trend. But it seems clear. As Manzara points out, normally the steepening comes from a suppression of short term rates (FF or ‘Federal Funds’ as he refers to it). The problem this time is that we are already at what used to be thought of as the lower bound for interest rates. It might be the case that the Fed can force rates negative, but Powell has spoken out against this, and truthfully nobody thinks it is a good idea. So the only way for steepening to continue is for inflation to get ignited, which, again as Manzara points out, means that DX goes down.

Manzara worries that the suppressed Nashville bombing, targetting infrastructure, as well as the Global Winds hack, the Huawei hack, and more and more information coming out about Chinese investment in voting machines manufacturers will trigger things. The previous cycles got going with the S&L crisis & Gulf War, the Y2K fiasco & Dot Com bust, the GFC and now … maybe a constitutional crisis as Trump throws a temper tantrum. Covid is still with us, and the unwinding of massive fiscal stimulus to survive it might still crash the economy.

Who knows, but it’s interesting to speculate. Certainly, the dollar has looked flakey of late.

Wrap

Stimulus bill passed. Hugely risk on for equities. For everything else, not so much: commodities pretty flat, energy down, metals up, most ag. up. Bitcoin … insane. Up 450% since March.

XRP is no longer tradeable. The SEC has taken action against execs. of Ripple Labs for holding an unregistered securities offering. No wonder Satoshi chose to remain anonymous.