Archive for the ‘Eurodollar Options’ Category
Will jobs report instill confidence?
June 8, 2020 –Friday’s blockbuster employment number of +2.5 million NFP sent yields soaring and steepened the curve to new recent highs. Tens jumped 9 bps to 90.5. 2/10 ended at 69 bps, up nearly 7. Red/gold euro$ pack spread settled 62, up 7.5. This data release will almost surely be subject to large revisions, […]
Bond Protest
June 7, 2020 – Weekly Comment The long bond smashed a storefront window and ran away with yields this week while the authorities stood by and watched like a big city mayor. The thirty year bond yield screamed 27 bps higher to 1.676%. Tens rose 26 to 90.5. The Russell sprinted 8% on the week […]
Steeper
June 5, 2020 –May jobs report today with nonfarm payrolls expected down 8 million and an unemployment rate of around 20%. You guessed it: BUY STOCKS. Stock futures are up this morning as the ECB heaped on stimulus yesterday and US is looking at spending another trillion to board up storefronts. –Curve steepened to new […]
YCC won’t hold down long end rates
June 4, 2020 –Bear steepener yesterday as stocks continue to levitate. Nasdaq (NQM) is only about 1% from Feb’s all-time-high. The Fed meets next week with the idea of Yield Curve Control gaining currency, but I am guessing there will also be discussion about asset prices surging past earnings fundamentals. –The ten year yield rose […]
Tingling at the long end
June 3, 2020 –Bitcoin failed at the 10500 level, closing at 9580 (June contract). The high was 10565. Gold was hit as well, and has been trading sideways for the past month between 1700 and 1770 (GCQ -16/oz to 1734). These markets could be thought of as beneficiaries of excess liquidity but appear to have […]
Real rioting; virtual currency
June 2, 2020 –DXY is at a new recent low 97.45 and the long end of the treasury curve is simultaneously pressing to new high yields. Curve steepened yesterday with 5/30 above 115 (and 1.5 higher this morning). 2/10 closed 50.5, up 1.7 on the day. Little movement in euro$’s. Ten year yield ended at […]
Ball of Confusion
June 1, 2020 –Protests, riots and looting give new meaning to ‘flight to safety’. However, equities have barely been dented. –Friday saw yields fall as the month closed, with tens down 5.7 to 64.4 bps. Curve flattened with 2/10 down 3.9 to 48.8. Vol slightly firmer.–Today’s news includes ISM Mfg expected 43.7 from 41.5 last. […]
Judgments of Value
May 31, 2020 – Weekly comment Below are excerpts of a speech given by Alan Greenspan at Jackson Hole on August 27, 1999, ‘New Challenges for Monetary Policy’ On such judgments of value rest much of our economic system. Doubtless, valuations are shaped in part, perhaps in large part, by the economic process itself. But […]
Lowest inflation data of year?
May 29, 2020 –I saw a note yesterday that Orange Juice was one of the best performing commodities this year. July (JON0) sank below 100 in March and soared over 130 in May, closing at 127.80 yesterday. Of course, crude oil has had a much larger percentage run off its debacle low in April (and […]
Just skip to the bottom
May 28, 2020 –My opinion is that increased gov’t control saps economic dynamism. Continued efforts to bring Hong Kong into the ‘one country, one system’ umbrella were punctuated by Pompeo’s declaration that HK has lost its autonomy, which will surely have negative economic consequences. I think the same is true in the monetary realm, but […]
