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Everything posted by Jorma

  1. Noland finally got to write an I told you so article. It feels like a case can be made that the credit cycle has turned. It's about time as they have been falling for almost 39 years. Well if you believe in economic cycles but many don't because they are always so choppy. The 60 year credit cycle is a popular credit cycle benchmark among we cycle believers. The idea that rates could trend up for10 or 30 years now is simply outside the imagination of most living people. I've been willing to concede that rates may not trend up for a very long time, till that big asteroid hits for instance, on the condition that there is no longer a market in the supply and demand for credit. If borrowers can always borrow more to pay off old loans so default risk disappears then you have a credit system but it isn't a market. Truth be told nobody wants a credit market. However everyone wants more money. Everyone is an inflationist. They want Mars bases, inflating assets and some want to help poor people have some basic needs given to them. I hate Mars bases and am fine with giving the unable and even unwilling some basics but I'm aware that money is created by credit/debt. Which goes to my comment a few days ago on how Treasury debt held by the Fed isn't really debt if it never has to be paid back. Beyond the lag between the Treasury paying off the principal and then borrowing more which a few days or weeks later ends up in the Feds account. That appears to be a market, it uses market mechanisms, but it's a Potemkin Market. The debt is debt in name only. A polite fiction. Even if most would willingly concede that the debt market isn't a market they would still insist it's Capitalism. Where capital is unlimited. The money seemingly falling from heaven allowing people to do stuff. A lot of it good stuff like taking care of themselves and their families and work together to build nice things and have a purpose in life, beyond building the throw away wasteful junk. I guess a world where money is essentially unlimited shouldn't be called capitalism it should be called moneyism. For 100k years since our bipedal cousins got words and became humans shortage and need was the fate of most. Now bankers have convinced everyone the problem for 100K years was simply the mistake of not having enough money. I'm skeptical. For instance at this juncture 1/3 of Americans would like to kill another third of Americans.
  2. Yesterdays 2 minute accident in the 10yr is the only solid show of illiquidty I know of
  3. At this rate I'm going to have to turn my laptop upside down so the 'all patterns resolve bullishly' rules stands
  4. There was a little accident at exactly 1PM in the ten year Treasury machinery. 16.14 in TNX. Something to shoot for.
  5. They don't know whatthey are doing. Nobody does. The numbers are too big.
  6. But there are the $139bn notes coming out on the 1st. Now I see some wags are saying the Fed wants a steeper yield curve, to get banks to go out there to fund the deficit.. Cripes.
  7. I don't actually think it's this. Maybe more like in front of a bicycle.
  8. Fun chart. The story of the entire adult lives of most working people today. Including banking and finance of course. The lesson; interest rates only fall. I suppose the US could follow Japan and just monetize most of the government debt, keeping even long term rates scraping bottom for years on end while the currency stays viable. That's what everyone is counting on, if they know it or not. Anyhow a fun chart as you can get the date week by week and try to remember what was happening at the time. https://www.macrotrends.net/2016/10-year-treasury-bond-rate-yield-chart The yield on the 10 is up only 50% this year. Is that a lot?
  9. Space based ETF's coming soon. Thought you should know.
  10. Looks like TNX is going to open north of 15.00, 1.5%
  11. The thing is nobody is going to the Fed Repo window. https://apps.newyorkfed.org/markets/autorates/tomo-results-display?SHOWMORE=TRUE&startDate=01/01/2000&enddate=01/01/2000 Big gap down on 10Y Note futures, ZN, on the opening last evening, and getting worse.
  12. How many times have they played this movie?
  13. It doesn't mean a thing but TNX is exactly where it was a year ago, to the day, as it plunged during the Covid, sell Mortimore sell moment. A point never seen again, till now. Another milestone probably nobody even knows about is that HSBC just announced it is leaving the US retail banking biz. The legendary criminal bank bought the failing criminal Household Finance in 2002 to bail it out and since it had a tiny bank attached HSBC became a US bank. Everyone was overjoyed. I think its exit from the US makes a pretty good story about the end of an era.
  14. I always make the mistake of thinking they know what they are doing. I mean $139bn of coupons on 3/1. WTF? So goose the short end this week and bury the long stuff the next? https://www.treasurydirect.gov/instit/annceresult/press/press_cashpydwn.htm
  15. There is no way they will allow this thing to deflate. If the PD's or bigger players are in trouble then I think we are at the point where the Fed and all the institutions will cheat. Go off balance sheet. How? I've got no clue. Face it. the Feds balance sheet is a joke. A polite fiction. The principal will never be settled. The debt isn't debt. The assets aren't assets. Nobody cares. On the other hand they can't stop pretending that the books mean anything. It that pretense which is poisonings social relations but nobody knows it. It's the social political breakdown which would crash it all. Random musings of an old man. One who is rarely mad, like some others.
  16. Yea, well who says? *Trying to be a real American. After 69 years just as well give it a try.
  17. It's essentially a year to the day that VIX spiked and left a gap. It will be a great example of something or other if it goes into the gap on the way to filling it exactly 1 year later.
  18. The heck with lines. Individual low points on bar charts of various interday periods, nipple bottoms, around the top of any hour are a lot more fun to watch for and watch. I'd say a rough case can be made that algos are current attuned to the clock, usually the top but sometimes the bottom of hours, as points to withhold support momentarily.
  19. They can't get stocks to go down because all the punters keep piling in constantly. Well everybody. How in the hell are they going to build inventory or do they need to? Maybe the old dealer story doesn't really apply anymore. I suppose all the serious people are now telling team D to scale down the stimulus. One way is to spread it out to reduce the supply pressure. Everyone assumes the entire 1.5 or whatever is coming this calendar year. Probably not now.
  20. Cripes. TNX 12.62 How in the hell have they kept mortgage rates scrapping the bottom?
  21. Lee, do you know the story of how the demand that the Treasury reduce it's cash balance to $130bn got enacted? Was it Team R or Team D that came up with this silly plan. In any case it's hard to figure how it saw the light of day. I would think Mnuchin and the Fed would have put the nix on that. At least on the principal that they shouldn't want any constraints on what they do. Since when do politicians not follow what the high priests of money suggest they do. Well I can see how the Street and the PD's would like the idea. Take as much supply pressure as possible off. But then what. $130bn is nearly a rounding error on a weekly basis. By the way. If by some bizarre chance that the mechanisms of QE suddenly would be acknowledged by all that it inflates financial assets it would not mean some great reckoning. It would become a policy demand. America was founded on the dream of asset inflation. It is what everyone wants.
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