You wouldn’t know it from stock trading or commodities, but when China reopened after its latest Golden Week holiday there was an obvious effect. Stocks have continued to surge while commodities overall have had a good week (copper up another $0.07 today, with WTI at about $50). Inside the money markets, however, China’s open was met with far less enthusiasm, [...]
It has certainly been much calmer in October so far, especially compared with the deep deviations following the FOMC’s lack of activity. Stocks have rallied since October 1 along with many commodities, especially crude. Currencies have been almost mellow, with the ruble following oil prices upward, the real departing (for now) from its devastation and even those like the Indian [...]
The doubts about the payroll report were taken as no doubts at all in “dollar” trading. The three indications I gave yesterday in terms of representing liquidity were all pushed farther after the jobs data essentially confirmed the direction where this is all likely heading. While the yen may have been more muted, and the “shock” wearing off in later [...]
The behavior of mortgage REIT’s lately embody a great deal of confusion about what they actually are and what that really represents. The first aspect to understand is that they are not participants in actual real estate, rather more closely aligned as a specialty financial firm akin to a non-registered bank. They make money as banks do (or supposedly they [...]
While central banks would prefer to isolate oil prices as if in their own world with nothing at all to do with finance and economy more generally, it is oil prices that continue the disappointment connecting the “dollar” to the growing market (and therefore economic) wreck. Front month and spot crude prices had bounced around more favorably since the August [...]
I think it worth noting one more reason Yellen was out front yesterday. Not only is liquidity suffering still globally but that is having an immensely negative effect on asset prices, especially at the bubble points. The S&P/LSTA Leveraged Loan 100 had not been updated since last Friday, which suggested (to me) continued pricing difficulties in leveraged loans. The combination [...]
As stocks selloff today, so too does the junk bubble. I think the implication traces back to the Asian “dollar” and the unsteady state of wholesale finance in that part of the eurodollar system (while contemplating the potential for mitosis to have occurred there at some point in the recent past, likely 2012). Junk prices not only remain depressed but [...]
Since the corporate bond bubble has added more than a half year since I last updated its size potential, it is worth reviewing given the lack of enthusiasm in that space post-August 24. Even before that “dollar” run clocked China and the rest of the world, the corporate bubble was being dented by the larger “dollar” trend dating back to [...]
The new week opens much the same as last week traded, with narrow ranges abounding in risky asset prices. From leveraged loans to junk debt, funding markets continue to run the correlations. From this “dollar” view, the lack of “buying” interest in the corporate bubble, bargain value or not, may more properly be understood as lack of “funding” interest. On [...]
The update to the S&P/LSTA Leveraged Loan Index was pretty much as expected following the interpretations I suggested Friday. Despite the alleviation of direct “dollar” pressure on liquidity subtracting from asset prices, there is a very distinct lack of enthusiasm to, at this point, rebid for margined assets or to pick up “bargains.” The index itself rebounded from a low [...]
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