Nomura’s McElligott Talks ‘Unshackled’ US Equities Amid ‘QE-Lite’ Anticipation

Nomura’s McElligott Talks ‘Unshackled’ US Equities Amid ‘QE-Lite’ Anticipation

"Normally" the post-September Op-Ex seasonal "should" see the S&P trade lower into month-end, but there's a new wrinkle thanks to the psychology around the imminent expansion of the Fed's balance sheet to alleviate reserve scarcity. For weeks, Nomura's Charlie McElligott suggested that US equities would trade up into mid-month, and then fade as a series of flow catalysts came off, and the forces keeping the index "pinned" near 3,000, rolled off. However, last week's acute funding squeeze i
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6 thoughts on “Nomura’s McElligott Talks ‘Unshackled’ US Equities Amid ‘QE-Lite’ Anticipation

  1. That post was fabulous …It was the most credible explanation of the unbelievable I ever read… Sometimes things are not what they appear to be on the surface especially in the world of finance.. Be careful everyone I think we have seen this movie before…

  2. The Government issues hundreds of billions of debt every year. The Government buys hundreds of billions of its own debt. The Government prints money by fiat. The Government issues price controls on the cost of money, and will intervene in order to maintain its price controls. The Government will compel private banks to buy its debt. The Government will then print money to help private banks maintain their Government mandated reserves, or the markets will crash.

    Thank God we don’t have Socialism, tho’.

    1. You can’t expect him to re-write his notes for a non-paying audience.

      That said, a discussion here about how to interpret all of this would be interesting.

  3. There has to be a way to simplify all this because it appears everyone is in a different stage of a denial mode. The common denominator is that everyone sort of agrees that all this incessant tampering yields a system that for all intents and purposes is broken. When something is broken past a certain point might fixing it start to be counter productive.???…McElligott has found a unique way to discuss these issues and at least offer a shred of predictive sanity but not really an ultimate solution…Kevin Muir at the same time says forget the should be and concentrate on the what will be..That is a workable start as well.

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