Archive for the ‘Eurodollar Options’ Category
Stalled negotiations
December 3, 2019 –Yields rose and the curve steepened yesterday, even as stocks fell with the prospect of stagnant trade talks and slower growth. ISM Mfg yesterday was only 48.1 and Prices were soft at 46.7, both weaker than expected. The ten year yield rose 5 bps to 1.826%, though it’s reversing some of that […]
Dr Woo
December 1, 2019 – Weekly comment This week we start out with some notes on Dr Copper, a commodity previously said to have a PhD in economics because it was such a ubiquitous manufacturing input and therefore its price indicated turning points in the economy. At this point, I’m not sure if its price has […]
Credit flashers
November 29, 2019 –Stocks slightly lower as Trump signed the Hong Kong democracy bill, further complicating efforts for a trade deal with China. On Wednesday, US yields rose, with tens up 3 bps to 1.769%. This morning shows little change with TYH0 129-155. Today features an early close at 1:15 EST. –Bloomberg running a headline […]
Calm before the storm
Nov 27, 2019 –Even as stocks continue to make new highs, yields are falling. Tens fell a couple bps yesterday to 1.738%. New lows in several euro$ one-year calendars, for example EDM0/EDM1 closed down 0.5 at -19.0 and EDU0/EDU1 down 1 at -11.5. On November 7, this latter spread had actually edged into positive territory, […]
Does M2 Matter?
November 24, 2019 On Monday, President Trump called an unscheduled meeting with Fed Chairman Powell. Here’s what Powell could have said in that meeting: Mr. President, I have taken several strong steps in support of your re-election campaign. Beginning in the second half, we’ve cut rates three times. It’s well known that monetary policy acts […]
In: Eurodollar Options
Done with austerity
Nov 22, 2019 -Reuters reports that President Xi wants to work out a Phase I deal, but isn’t afraid to retaliate if necessary. Right out of the Trump play book. Christine Lagarde gave her first speech as head of the ECB, but avoided monetary policy and said the ECB must generate internal domestic demand through […]
C students
November 21, 2019 –There’s an interesting video post on twitter with Raoul Pal and Keith McCollough where the latter notes that the spread between BBB and CCC corps keeps moving higher. I created the attached chart from the St Louis Fed website. Indeed. the CCC effective rate is nearing the high seen at the end […]
Testing highs from the last FOMC in front of minutes
November 20, 2019 –In skimming various news items this morning on the US/China trade saga, both the possibility of tariff rollbacks and increases are mentioned. In any case, the path to an easy start with a Phase One deal has hit a snag with the Senate’s passage of a Hong Kong bill of rights which […]
Come see me at the White House…
November 19, 2019 –Yields once again eased lower with tens down 2.6 bps to 1.805%. Another snag in US/China talks yesterday morning sparked a rally in fixed income, and reports of an unscheduled meeting between Trump and Powell underscored the administration’s pressure for easier money and a weaker dollar. While the Fed’s subsequent statement stayed […]
Corrections and housekeeping
Nov 18. 2019 In this morning’s post, I mistakenly said that the Chicago Fed National Activity Index (CFNAI) was being released. If is…. but I was a week early. I guess that’s why we call them FUTURES markets. Also, on the Deer Season post of Nov 17. apparently the links and pictures didn’t work. I […]
