eurodollar futures

Sure, One and Done

By |2019-08-01T15:35:23-04:00August 1st, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The FOMC yesterday reiterated their stance that the economy was strong. But they also hedged. A one-and-done rate cut is one thing, some insurance (allegedly) for keeping the good times rolling. What about QT, though? That’s the funny thing that you can’t help but get stuck on. Not bank reserves, mind you, they’re worthless (perhaps [...]

The Speed of Sour: LIBOR Now Inverted, Too

By |2019-06-25T17:09:14-04:00June 25th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Last week, for the first time since February 2008, the LIBOR curve inverted. The 3-month tenor has been on the move downward for some time. The 1-month rate has been gentler in its slope. Last Thursday, the two finally crossed. As unnatural as inversion in the UST curve or elsewhere, it’s another sign of imminent [...]

Behind The Blame Game, A Nastier #4

By |2019-06-21T11:57:48-04:00June 21st, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

After what is all but certain to be the final “rate hike” in this cycle, Bloomberg reported that President Trump had previously explored all possible legal ramifications of demoting Federal Reserve Chairman Jay Powell. The issue has become a major one, in the media, anyway, now that Mr. Powell has indicated his error. There will [...]

Curve Sanity (Updated)

By |2019-06-19T17:10:47-04:00June 19th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

UPDATED for imminent rate cuts and latest FOMC statement (June 19) Rate cuts will be insurance against whatever “trade wars” will throw at the global economy. That’s the current line from monetary officials in the US, anyway. The real question to ask is, how would they know? Starting with trade wars. Is that really what’s [...]

TIC Reveals The Landmine; This Time Is Already Different

By |2019-06-18T16:34:52-04:00June 18th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

I’ve been writing since October when China reopened from that month’s Golden Week holiday that big dollar problems were imminent. You needn’t have taken my word for it, the PBOC said as much. Not directly, of course, but in interpreting the central bank’s anticipated behavior left little doubt.  Over the next few months, more and [...]

Curve Sanity (Not What Most People Want To Hear or See)

By |2019-06-13T18:47:44-04:00June 13th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Rate cuts will be insurance against whatever “trade wars” will throw at the global economy. That’s the current line from monetary officials in the US, anyway. The real question to ask is, how would they know? Starting with trade wars. Is that really what’s behind all this? The evolution of the curves told you everything [...]

Curve-sanity

By |2019-06-12T19:01:18-04:00June 12th, 2019|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

There are those which are so very clear in their disingenuousness – to the point of overdoing it and becoming obviously absurd. In the increasingly desperate rush to downplay the headlong race to rate cuts, this one’s up there: Eurodollar futures traders, having decided that the Federal Reserve is likely to cut the fed funds [...]

Payrolls: Rate Cuts Not Of Their Choice

By |2019-06-07T12:09:23-04:00June 7th, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

It’s never just one payroll report. The month-to-month changes in the Establishment Survey barely qualify as statistically significant, let alone meaningful. What that means is one good monthly headline is nothing to get excited about, just as one bad month shouldn’t get anyone too worked up. May 2019’s jobs report, however, isn’t in isolation. The [...]

What Kind Of Risks/Mess Are We Looking At?

By |2019-06-03T18:08:37-04:00June 3rd, 2019|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The fact that the mainstream isn’t taking this all very seriously isn’t anything new. But how serious are things really? That’s pretty much the only question anyone should be asking. What are the curves telling us about what’s now just over the horizon? I hesitate to use 2008 comparisons too often because many people immediately [...]

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