I’ll give you a tenth of a bitcoin per acre of corn – IF you can deliver

June 17, 2019

–Middle of June and it’s just 56 degrees in Chicago as cool damp weather persists.  Reuters ran an article this morning about farmers in Illinois lamenting the lost corn crop, noting that one farmer planted only 900 of 8500 acres.  Dec Corn is up 8 1/2 cents this morning to a new high of 472.  Apparently there has also been trouble in getting the bitcoin crop seeded, because that has also surged to a new high this weekend, trading up 770 at 9210 on the CME.  

–The question is whether the bitcoin rally, now said to be sparked by “institutional” buyers, is an initial sign of crumbling confidence in central banks.  Or in the financial sector in general.  It’s reported this morning that Deutsche is setting up a “bad bank”.  Wait a minute, don’t you already HAVE one?  The idea of course, is to isolate toxic assets.  I suppose if bitcoin was a true signal, gold would also be surging, but it’s down $7/oz this morning in follow-through from a reversal from new highs on Friday.  Rate futures have also pulled back in front of Wednesday’s Fed decision.   With the June contract off the board today, EDU9 is now the lead contract and EDU9/EDU0 is the most negative one-year spread, having settled Friday at -45.5, indicative of two eases over that year.  Of course, the market continues to give high odds of cuts PRIOR to September, with July/August Fed Fund spread settling -19.5 on Friday.  It’s just not going to happen on Wednesday.

–Maybe the bitcoin surge is based on the realization that new supply requires electricity for mining, and the massive outage in the southern hemisphere is a shot across the bow.  “No you idiot, I said to destroy the power grid in America and the USA, not Argentina and Uruguay!”  

–Today’s news includes NY Empire State Mfg, with a consensus of 11 vs 17.8 last.   –As a political aside, Trump apparently fired his pollsters due to bad numbers.  I heard a fascinating interview this weekend on The Market Huddle (MacroTourist Webcast) featuring Stephen Aniston, who posits that Trump will lose the next election, in part based on migration from California to Texas, which will shift Texas to a blue state.  They’re not leaving CA because the weather is bad.  It’s because the policies and taxes are so onerous that they’re FORCED to leave, and try the same policies somewhere else!  (A lot of other good stuff in the webcast as well).  https://www.youtube.com/watch?v=NdByG6BzNQs

–Another interesting article on ZeroHedge, having something to do with Formula One racing and grid girls. There are a lot of pictures and something to do with racing and sponsorship.


Posted on June 17, 2019 at 5:16 am by alexmanzara · Permalink
In: Eurodollar Options

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