December 23, 2022: Just the Facts
For the Week: The S&P500 slipped 0.2% (down 19.3% y-t-d), while the Dow increased 0.9% (down 8.6%). The Utilities rallied 1.5% (down 1.8%). The Banks recovered 1.7% (down 24.9%), and the Broker/Dealers gained 1.1% (down [...]
December 16, 2022: Credit Downturn Acceleration
Interesting week. The FOMC statement and “dot plot” were viewed as somewhat more hawkish than expected. In his press conference, it was a solid “Balanced Powell” performance. Powell stuck with his now familiar hawkish points. [...]
December 9, 2022: Blackstone, Inflection Points and the Z.1
I’ve been eagerly anticipating the Fed’s Q3 Z.1 report. As expected, Credit growth slowed somewhat. At a seasonally-adjusted and annualized (SAAR) $3.284 TN pace, Non-Financial Debt (NFD) growth slowed from Q2’s SAAR $4.318 TN and [...]
December 2, 2022: Dr. Jekyll and Mr. Hyde
Bloomberg’s Jonathan Ferro: “What is it that Chairman Powell did on Wednesday that you disagree with?” Mohamed El-Erian: “I said it contributed to undue market volatility. It’s the undue part -excessive market volatility. I think, [...]
November 25, 2022: Market Thoughts
Greed and Fear. “Risk On” and “Risk Off.” “Markets will do what markets will do.” It’s not unreasonable to accept that today’s markets are simply following typical patterns. There’s nothing that remarkable about the current [...]
November 18, 2022: SBF, FTX and QE
An outlandish aberration, or a distressing sign of the times – and of what’s to come? Curious readers for centuries have been fascinated by the great 17th century Dutch Bubble. “At the peak of tulip [...]
November 11, 2022: Derivatives, Squeezes and Fiascos Aplenty
How does one chronicle a week like this one? “Sam Bankman-Fried’s $32bn FTX Crypto Empire Files for Bankruptcy.” “What’s Next for Crypto as FTX Collapse Triggers ‘Lehman Moment’?” “Stocks Skyrocket in Best Post-CPI Day on [...]
November 4, 2022: Powell Building Credibility
The guy sounds like a discerning traditional central banker. Powell is an admirer of Paul Volcker’s fortitude, and he’s clearly drawing inspiration from the legendary Fed Chairman. Markets are growing impatient. It was a misstep [...]
October 28, 2022: Blinked
The S&P500 jumped 4.0% this week, boosting the index’s two-week rally to 8.9%. The small caps rose 6.0% (two-week gain 9.8%), with the average stock (Value Line Arithmetic) up 5.4% (two-week gain 9.6%). Ten-year Treasury [...]
October 21, 2022: Dissecting Chairman Xi
Please join Doug Noland and David McAlvany this coming Thursday, October 27, at 4:00 pm Eastern/ 2:00 pm Mountain time for the Tactical Short Q3 recap conference call, “Prelude to a Market Accident.” Click here [...]
October 14, 2022: New Cycle Realities
It would have been a nonevent; inconsequential. Confirming New Cycle Dynamics, the Truss government’s “mini budget” has unleashed absolute mayhem. Pension funds blowing up. Emergency central bank rescue operations. Global market instability. UK’s Treasury Secretary [...]
October 7, 2022: McAlvany Wealth Management Client Conference
Adapted from my Friday, October 7, 2022, presentation at the annual McAlvany Wealth Management Client Conference in Durango, Colorado. I fell in love with macro analysis sitting at a trading desk staring at Telerate and [...]
September 30, 2022: A Threatening Turn
Global de-risking/deleveraging has taken A Threatening Turn. It’s no exaggeration to write that the UK pension system was this week at the brink of spectacular collapse, with confidence in policy and market function hanging in [...]
September 23, 2022: Putin & The Vigilantes
It really got going Tuesday. Chinese “big four” bank CDS each surged about 10 bps, the largest single-session gains since the July 15th peak “risk off.” Heightened risk aversion was not limited to Chinese banks. [...]
September 16, 2022: Deflation and Policy Mistakes
Hotter-than-expected August CPI and quarterly options/derivatives expiration made for a toxic mix. “Core” CPI was reported up 0.6% for the month (7% annualized!), double estimates. With the peak inflation narrative having received the blessing of [...]
September 9, 2022: Valuable Insight from the Q2 ’22 Z.1
Reuters headline: “U.S. Household Wealth Suffers Record Drop in Second Quarter.” Bloomberg: “US Household Net Worth Falls Most on Record on Slump in Stocks.” Yes, Household Net Worth fell $6.1 TN during Q2, the largest [...]
September 2, 2022: Super Credit Bubble
Global “Risk Off” gathers momentum by the week. Crisis Dynamics fester, as global central banks coalesce around a united front for battling inflation. The reality that central bankers will aggressively hike rates until something breaks [...]
August 26, 2022: New Cycle Monetary Management
I appreciate that Jay Powell is no ideologue. His Fed has made some historic missteps, and Powell as Chair has sometimes flailed. But I’m willing to cut him some slack. I hold his predecessors responsible [...]
August 19, 2022: Inaugural Squeeze
It was in ways business as usual. “Risk off” had attained powerful momentum globally back in July. De-risking/deleveraging dynamics were increasingly fomenting illiquidity, contagion and instability across global markets. Bubbles were bursting. Derivatives-related selling was [...]
August 12, 2022: The Everything Squeeze
Wednesday’s CPI release was telling. July consumer price inflation data were somewhat better than forecasts. Instead of increasing 0.2%, headline CPI was flat for the month. “Core” prices rose 0.3%, less than the expected 0.5%. [...]