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oil

Fundamental and Finance; Really Downward

By |2016-01-28T18:14:19-05:00January 28th, 2016|Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Rumors persisted about Iran, Russia or OPEC close to declaring productions cuts, so that has to factor at least into sentiment about oil trading. However, with rumors being denied, the physical universe of crude oil especially in the US has been fundamentally more negative again. Yet, oil prices have reached back to almost $34 (front month futures) again today just [...]

Asian Axis of Junk

By |2016-01-13T18:04:30-05:00January 13th, 2016|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

You almost have to marvel at the resilience shown in leveraged loan pricing over the past nearly month. Prior to the Fed’s rate decision on December 16, the leveraged loan market, as with the rest of the junk bubble, was sinking fast and furiously. Since then, however, despite great financial turmoil all over the world, and even in the places [...]

Reading Curves and Finding Only the Death of Money

By |2016-01-11T18:58:21-05:00January 11th, 2016|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

When analyzing the full and true nature of the dissonance between the idea of continued recovery and the financial markets’ scenario for something much worse you realize that this is not a new occurrence. In curve after curve, negativity has been building for years. Financial curves are important because they tell us the health of the monetary economy, namely assumptions [...]

PBOC Wastes No Time Proving Desperation

By |2016-01-11T12:28:30-05:00January 11th, 2016|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

The PBOC wasted no time this week showing that it was serious about its desperation last week. The central bank fixed the CNY reference contrarily upward to 6.583 this morning from Friday’s 6.600. As we have been documenting during this unabated “dollar” problem, whenever the PBOC attempts a contrary maneuver with the fix it typically sets off enormous fireworks. Sure [...]

Where Is The Outlier Position Now?

By |2016-01-07T16:33:41-05:00January 7th, 2016|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

In its December 2015 policy statement, the one that raised the federal funds target corridor, the FOMC changed the language surrounding its inflation stance. They still projected the 2%, of course, but were now indicating that they were more certain than ever about it. In many ways they had to shift the wording because of the actions; the prior passage [...]

Broad Side Effects To Oil

By |2015-12-23T17:04:42-05:00December 23rd, 2015|Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

Not long ago, I wrote that it was somewhat odd that more attention wasn’t being paid to sovereign wealth funds. This was only somewhat surprising given that oil prices were still thought “transitory” and thus the mainstream clearly felt there wasn’t anything deeper to be assembled from that. However, now that it has finally dawned that oil isn’t likely to [...]

That ‘Other’ Non-investment Stock Bid

By |2015-12-14T15:38:15-05:00December 14th, 2015|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Stocks|

On November 2, Hong Kong’s Exchange Fund reported its worst ever quarterly loss. For the quarter the number was an astonishing -HK$63.8 billion, turning what was an already-reduced YTD profit from Q2 into a –HK$36.8 billion loss so far for 2015. What caught most people’s attention was not specifically the loss but that it was derived more so from “other [...]

Kicking Off The Next Phase

By |2015-12-08T15:59:13-05:00December 8th, 2015|Economy, Federal Reserve/Monetary Policy, Markets|

The fact that there is almost universal recognition of a “manufacturing recession” not just here but spreading across the world is a significant change. After resisting and ignoring as much as possible for more than a year, economic weakness is now no longer unthinkable. This is, however, no mere academic exercise as there are very real consequences as the former [...]

The Dramatically Shifted Baseline

By |2015-12-07T16:49:42-05:00December 7th, 2015|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Crude oil prices are exhibiting all the signs of an increasingly difficult funding environment. The front end of the futures curve is being bent dramatically in relation to even close maturities just outside the next few months. Such contango is the obvious imprint of finance, though that is not to say that economic expectations are neutral in the curve. Far [...]

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