BLUF: SPX Higher and Short Bonds…Place Your Bets!!!
Interesting Points:
1. DEBT CEILING is No more…the DC incompetents finally do something right! Govy Spending cranks up…good for the Macro! At least a 30-day lag of government money flows running through the global economic pipes!
***TCB declines, yields fall (bond prices go up). Its the Quantity Theory of Money at work. A lower amount of cash/liquidity chasing an asset pushes up its price, and vice versa. Now the process reverses. Lots of treasury supply as the drought breaks means they go lower in price. Now the process reverses. Lots of treasury supply as the drought breaks means they go lower in price.*** Do not be too early!
2. Technical Nonconformity: Divergent Indexes, something is amiss?...TBD
3. Markets are @ All-Time-Highs…Why is the FED cutting rates? What do they know that we do not?
4. FOMC Meeting 30-31 July, How much Rate-Cuts and When? Cheap Money, Asset Inflation…lets watch!
Do we get a summer pullback or more sideways…given the recent news/sentiment I tend to be in the “Sideways-Camp” as the macro engine starts to rev up….Risk on, Risk Off, what is your bet?
Have a great summer, stay cool and raise a cold beer in the air…Cheers!!!
Interesting Points:
1. DEBT CEILING is No more…the DC incompetents finally do something right! Govy Spending cranks up…good for the Macro! At least a 30-day lag of government money flows running through the global economic pipes!
***TCB declines, yields fall (bond prices go up). Its the Quantity Theory of Money at work. A lower amount of cash/liquidity chasing an asset pushes up its price, and vice versa. Now the process reverses. Lots of treasury supply as the drought breaks means they go lower in price. Now the process reverses. Lots of treasury supply as the drought breaks means they go lower in price.*** Do not be too early!
2. Technical Nonconformity: Divergent Indexes, something is amiss?...TBD
3. Markets are @ All-Time-Highs…Why is the FED cutting rates? What do they know that we do not?
4. FOMC Meeting 30-31 July, How much Rate-Cuts and When? Cheap Money, Asset Inflation…lets watch!
Do we get a summer pullback or more sideways…given the recent news/sentiment I tend to be in the “Sideways-Camp” as the macro engine starts to rev up….Risk on, Risk Off, what is your bet?
Have a great summer, stay cool and raise a cold beer in the air…Cheers!!!