Birth name "Hilary", SAG name "Hilaria" for her TV credentials.
You finding the love while at work?
He would greet one warmly, so long as his ass was kissed deeply, first.
WHY "MACRO" FAILED AND THE MEANING OF GLD/TLT
"Year end is always a time of reflection for me. What have a I learnt, what do I think will do well next year. This is particularly true in 2023, as my main trade long GLD/short TLT wen from threatening to go parabolic in October, to reversing most of its gains in November and December.
I have suffered through many punishing reversals in markets. There is always a lesson to learn from these moves, the problem for most fund managers is whether they are willing to learn or not, or even if they are open to the idea of learning. Even though GLD/TLT traded well until October, I have been caught by surprise by how well liquidity driven assets like equities and even crypto have traded. I thought 5% Fed Fund rate would have starved the market of juice. You wanted to buy the Nasdaq 100 at the beginning of the year.
I was always keen on asset flows and capital markets (hence the title of the substack). I was very keen on the concept of NIIP, but this has been bearish on US assets since 2016, when private sector NIIP hit the same extreme as 2000.
As I licked my portfolio wounds this month, I paused to think about markets. “Macro” analysis and hedge funds work best in recessions. An old market saying is that recessions are about balance sheets, while bull markets are about profit and loss. What that is saying, in good times, you want earnings growth, and in bad times you want a solid balance sheet. Where macro analysis has gone wrong in my view is that we assume dodgy lending, awful balance sheets, plainly criminal CEOs and massive retail investment are all times of a top, and all these dodgy characters are about to get the just deserts. Even I thought about shorting private equity - and idea that many subscribers endorsed. A 45% rally from recent lows makes me happy I chose not to short it.
So what is the market trying to tell us about macro, central banks and US equity markets. So first some context, I talk about GLD/TLT as they are easily traded ETFs, but I am looking at a return to very long term graph of GLD/TLT. TLT is replaced with a long dated treasury return index. Plainly the 1970s was a very different time to the 1980s and 1990s, but bares some resemblance to 2000s, but 2010s where a return to 1980s and 1990s again. What connects all this disparate eras?
The US oil industry continues to consolidate. At some point does market structure and incentive kick into see supply controlled and pricing discipline return. What I like about this analysis is that it explains why so many “macro” tools have proved useless in this bull market. The US will always want a bull market, except in oil prices. When energy prices are weak, US equities will do well, and when they are strong, there are problems. The GLD part of GLD/TLT suggest higher commodity prices will return."
https://www.russell-clark.com/p/why-macro-failed-and-the-meaning
Glow Bull
Echoes of Conventional Wisdom
Closing Wrap - Monday 18.12
HEADLINES
Fed’s Goolsbee: Too Early To Declare Victory Over Inflation
Fed's Mester: Markets A ‘Bit Ahead’ Of Central Bank On Rate Cuts
Biden’s Approval Rating Hits New Low On Economic Worries, Poll Shows
ECB's Stournaras: Need To See Inflation Below 3% By Mid-Year Before Cutting Rates
ECB’s Vasle: Rate Cut Bets Premature, Markets Have Eased Too Much
ECB’s Kazimir: Premature Easing Worse Than Holding Too Long
German Ifo Business Confidence Falls Unexpectedly As ‘Economy Remains Weak’
BoE's Broadbent: It Is Too Soon To Say That Wage Growth Is Cooling
BoJ Likely To Keep World’s Last Negative Rate In Upcoming Decision
Japan PM Kishida’s Support Tanks After Replacing Scandal-Hit Cabinet
10-Year Treasury Yield Rises To Start The Week
Dollar Eases Against Euro As Fed Rate Cut Outlook Weighs
Oil Gains As BP Joins Shippers Avoiding Red Sea’s Rising Attacks
S&P 500 Rises Monday As Market Adds To Seven-Week Advance
Goldman Strategists Lift S&P 500 Forecast A Month After Setting It
Apple To Halt Watch Sales As It Prepares To Comply With US Import Ban
Houthi Attacks Start Shutting Down Red Sea Merchant Shipping
COMMENTARY
German Ifo Business Confidence Falls Unexpectedly As ‘Economy Remains Weak’
German managers were surprisingly more downbeat about their prospects this month, with confidence in construction falling to its lowest mark since September 2005, according to the latest survey by Germany’s Ifo economics institute.
Monday’s results and other recent polls have suggested further softness in the months ahead for Europe’s largest economy
Ifo said Monday that the results of this month’s survey of companies showed a drop in its headline business climate index to 86.4 points, an unexpected decrease as economists had forecast a fourth-straight rise to 87.7. Ifo announced a tenth of a point reduction in the November reading to 87.2 points.
(Continue Reading - LiveSquawk)
BoJ Likely To Keep World’s Last Negative Rate In Upcoming Decision
The Bank of Japan is widely expected to keep the world’s last negative interest rate intact on Tuesday, with investors set to scour comments for hints on if — and when — authorities might scrap the policy next year.
Almost all 52 economists surveyed by Bloomberg forecast no change in major policy settings for the short-term rate and yield curve control mechanism at the policy meeting that concludes on Dec. 19.
(Continue Reading - Bloomberg)
Oil Gains As BP Joins Shippers Avoiding Red Sea’s Rising Attacks
Oil rallied as more oil companies and tanker owners began to avoid the Red Sea amid increasingly frequent attacks in the region.
West Texas Intermediate rose as much as 4% to trade above $74 a barrel and reach the highest intraday price in two weeks. BP Plc said it will pause all shipments through the Red Sea, while Equinor ASA is diverting vessels away from the region. Euronav NV, a major shipowner, is also keeping its ships clear, citing safety concerns.
(Continue Reading - Bloomberg)
Millions Of Student Loan Borrowers Still Aren’t Making Payments
Following a three-year pause, payments on federal student debt officially began again in October, three months after President Joe Biden’s one-time forgiveness plan fell through. Yet 40% of the 22 million borrowers who had bills due did not make their payments by mid-November, according to the US Department of Education.
Student loan borrowers provide a window into the financial health of everyday Americans, who are grappling with higher housing costs, automobile debt and increased food bills that have strained household budgets.
(Continue Reading - Bloomberg)
https://www.livesquawk.com/report/evening_3241
Glow Bull
Moar heavily weighted by CTAs than wut wuz sed earlier.