PAWNBROKER: Man, that watch is so hot, it’s smokin’

March 18. 2020

–Everything is melting down this morning as the Fed is about to become the biggest pawnbroker in the world.  They are about to take any collateral at all and turn it into cash for immediate use, including Aunt Bertha’s needlepoint chair.  I was looking at the ultra-bond chart yesterday and it reminded of TSLA (with a lag).  I was amusing myself, thinking that TSLA broke its 100 DMA at 506 and is still lower….that ought to project 191 for WNM0.  Well, this morning the June Ultra-bond is down 11 at 200.  Not so far-fetched.  Trump is asking for a trillion dollar stimulus, while the Fed is on a 24-7 run of printing cash.  What difference does credit rating make in that environment?  What value, cash?

–April crude this morning just above $26/bbl while I see Sept at 30.23.  Pretty darn good returns if you can take the spot and store it, looking in the forward.  But what is the world going to look like in September?  

–Italy banned short selling and the US is likely close.  A loss of 50% in SPX would be 1697; I believe the loss in the crisis was 57%. 

Posted on March 18, 2020 at 4:41 am by alexmanzara · Permalink
In: Eurodollar Options

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