Every August I try to check out from both client activity and market commentary. Of course, if trading conditions warrant (as they did in 2011 and 2015), then I write. But if nothing of substance occurs, I prefer to use this time to rest up for what is always a very...
The US CPI has missed market expectations on the downside for the last four months, crashing to a growth rate of 1.6% YoY most recently, from 2.7% YoY back in February. At the same time, core CPI growth has dropped back to 1.7% YoY, and core PCE price index growth has...
A few weeks ago, in a commentary entitled “The terminal funds rate,” I began to flirt with returning towards a positive view on risk parity trades. Looking back, it has been about a year since I recommended the spoo side of that trade – and about 18 months since I had...
On Wednesday we will almost surely get the fourth rate hike of this cycle. And just as a reminder to all the folks who used to think the Fed could never raise rates again without sending us into a 1937-style second Great Depression – uh... that was a really dumb...
I am going to make a bold claim today: US inflation is shockingly high. Now of course, with core PCE at 1.5% and core CPI at 1.9%, your first reaction might be "That Zervos dude is out of his mind – again!" But bear with me; I think I can convince you that this claim...
Expectations for fiscal and regulatory easing, along with a modest withdrawal of monetary accommodation, created a post-election tailwind for spoos, the USD, and Treasury yields. And to be sure, this tailwind occasionally blew with gale force (particularly in the...
I have been struggling for a couple weeks now to find anything exciting to discuss in these commentaries. Our European political view seems to have panned out reasonably well with moves towards the center in both the Netherlands and France. It appears, at least for...
For the last 16 months I have spent very little time in these notes focusing on Europe. ECB reticence to act aggressively post the policy debacle of Dec 2015, combined with high levels of political uncertainty into 2017, created a very poor risk/reward outlook for...
I imagine that as the finishing touches were being placed on the Fed minutes from the second floor of the Eccles building late this past Tuesday evening, the authors were all thinking - "I wonder how large the bond and stock market sell off will be after the...
I realize that I have not written any notes since mid March - and I wanted to just give everyone an update on my brief hiatus from market commentary. Unfortunately, I needed to have two abdominal hernias surgically removed about a week ago. And naturally this has...
I realize that I have not written any notes since mid March - and I wanted to just give everyone an update on my brief hiatus from market commentary. Unfortunately, I needed to have two abdominal hernias surgically removed about a week ago. And naturally this has taken me fully out of commission. The most […]
