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eurodollar curve

Another Word Degraded By Depression: Reflation In 2016 Doesn’t Actually Mean Reflation

By |2016-11-28T19:15:36-05:00November 28th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Dating all the way back to February 11 and the Chinese turn on the “dollar”, the eurodollar futures curve had been stuck in a relatively narrow range. That trading band was widened a bit in June before and after Brexit (related to CNY’s regular mid-year drop), with futures on the whole curve bid up to early July and then slightly [...]

Cisco And Target Are Not Really About Cisco Or Target

By |2016-08-17T12:48:59-04:00August 17th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The words of the day are apparently “sluggish” and “challenging.” Overnight both Target and Cisco, bellwethers in retail and tech, respectively, were both the subject of intense scrutiny. Target released earnings that “beat” while revenues and really same store comps were particularly weak. Year-over-year, sales declined 7.2% total (revenues from Q2 2015 include Target’s pharmacy business which was sold to [...]

Uncomfortably Familiar

By |2016-06-16T18:10:12-04:00June 16th, 2016|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

This is all starting to look very familiar and predictably so: Especially this: It is utterly extraordinary that the June 2023 eurodollar futures contract closed trading at 98.00, much less than on February 11 and a collapse of more than 150 bps in anticipated 3M LIBOR seven years in the future just since last July. It is, again, entirely anticipated given the [...]

Illiquidity, Safe Havens, and the Search For The Trigger

By |2016-06-13T19:10:59-04:00June 13th, 2016|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

If there seems to be more safe haven demand of late, the increasing odds of British exit from the EU is being blamed. According to Yahoo!Finance, Goldman Sachs sees “kinks” in the option structure, an agglomeration of hedging demand that points to maturities around the UK referendum. The absence of any heavy hedging this week suggests that markets have no [...]

Potentially Interesting Isolation On JPY

By |2016-04-20T18:12:21-04:00April 20th, 2016|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Today was the third consecutive down day or selling in eurodollar futures. The June 2018 contract settled below 98.80 for the first time in April, almost unwinding the move higher at the start of this month. Even after the selling, the eurodollar curve remains as depressed as ever, discounting an entirely different set of future circumstances than stocks or junk [...]

No Longer Overseas

By |2016-02-11T17:10:11-05:00February 11th, 2016|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

I use the June 2018 eurodollar futures contract as a significant benchmark in my analysis of money markets because I feel it represents a solid cross section of sometimes conflicting influences. It’s close enough to the front end as to be significant both in terms of monetary policy as a factor but far enough to be as heavily if not [...]

The Kingdom Offers Less Oil

By |2015-11-25T16:33:51-05:00November 25th, 2015|Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

While the media remains fixed on supply, the rest of the financial complex is prepared elsewhere. On Monday, Saudi Arabia announced what the mainstream has been waiting for (and often blatantly demanding) since the summer “rebound” faded into August liquidations. Given the mythical status of Saudi supply, this was the one country thought to be the only possible savior. Crude [...]

The New ‘Dollar’ Paradigm

By |2015-11-16T15:47:19-05:00November 16th, 2015|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

To say that the “dollar” is a mess to begin the week is to state the obvious. The condition left at Friday’s close has persisted, with commodities and such being sold heavily from the outset. Japan’s renewed “recession” (I use quotes only in the conventional sense, given that the Japanese economy never truly left) hasn’t helped in that regard, but [...]

Payroll Reports Sink ‘Dollar’ Further

By |2015-10-02T12:58:13-04:00October 2nd, 2015|Bonds, Economy, Federal Reserve/Monetary Policy, Markets|

The doubts about the payroll report were taken as no doubts at all in “dollar” trading. The three indications I gave yesterday in terms of representing liquidity were all pushed farther after the jobs data essentially confirmed the direction where this is all likely heading. While the yen may have been more muted, and the “shock” wearing off in later [...]

Toward Another Try at Liquidation?

By |2015-09-28T17:37:41-04:00September 28th, 2015|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

While central banks would prefer to isolate oil prices as if in their own world with nothing at all to do with finance and economy more generally, it is oil prices that continue the disappointment connecting the “dollar” to the growing market (and therefore economic) wreck. Front month and spot crude prices had bounced around more favorably since the August [...]

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