Nomura’s Charlie McElligott And The ‘Grabby Squeeze’
“There’s not a lot to debate here”.
“There’s not a lot to debate here”.
“The risk is that this inability for the Fed to keep pace with market pricing could create a de facto ‘hike’.”
It’s the damndest thing.Â
Obviously, the macro narrative is a train wreck, but…
“This is where I expect [the] next wave of monetization in hedges”…
Around the world and back again.
“If you’re short vol, you make money…but eventually die. But if you’re long vol, you die before you make money.â€
“It currently looks as if as we are seeing this supply ‘tip’ into realization”.
Beware “vigilante markets”.
“I remain completely convinced that the bar to CUT is infinitely lower than the bar to HIKE.
Here’s a quick primer on the key debates and discussions.
“Do NOT buy into the ridiculous ‘Hedge Funds Shortest VIX Ever’ as some sort of lame ‘complacency’ indicator.”
“All of this does this”…
“But for the real ‘HEAT’ of today’s note”…
…especially about the “particulars”.
“It all comes down to the renewed ‘Carry is King’ worldview in light of central banks being scared of their own shadows.”
With a caveat (or three).
“Thus, the pullback window has to happen now.”
“I continue to believe the largest catalyst for last week’s front-end inversion spasm was the market’s realization that”…
“Back in the bond-buying business”.
“Allow me to get this off my chest immediately”
“…with a Fed which has completely gone limp.”
But there’s a caveat…
“Just right” on the data stateside, while a “re-bubbling” in China holds RRR cuts “hostage”.
“Lots of questions about the behavior in equities.”
“Okay…so now what?!”
“…we’d be at risk of seeing this very leveraged strategy turning a NET SELLER.”
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