End of QT ≠ QE.
End of QT The end of QT is the first concept we need to truly absorb. What ended on Monday was a mechanism through which the Fed was absorbing liquidity from the system. The specific methodology — the “how” — has already been explained here, and it’s not relevant for today’s piece. Markets have been […]
#6 QT, Liquidity and capital flows around the world
We analyze QT from different time perspectives. We dive into the concept of liquidity as applied to different sectors. What it can solve and what it cannot. A complete intermarket capital flow tracking, sub-categorized to refine the analysis. We look at the weekly positions of risk takers.
#77 The Macro Split: Why Recession and Stagflation Trade Nothing Alike
Recession and Stagflation require distinct trading methods. The recession methodology is clear; however, Stagflation is far more confusing. Here are our options for trading both stages.
#76 MBS-The Hidden Circuit Behind the Housing Market — and Burry’s Technical Beauty
MBS, or mortgage-backed securities, are the currency banks use to access the Fed’s liquidity window. The Fed takes them at par, automatically providing liquidity while simultaneously boosting the construction market through the creation of new loans.
#75 SOFR rate spikes — normal plumbing or something more?
SOFR rate spikes are always a warning that something’s happening in the monetary plumbing. Here we explain what it is. When to worry — and when not to.
#73 The Real Economy and the Markets
The flip side of the fiscal deficit is a constant injection of liquidity into the system. It’s the fiscal leg of monetary policy—and it depends on the administration in charge.
#71 Dot-com and G.F.C: similarities and differences with the current situation
The current situation: Similarities and differences with the GFC and the Dot-Com crisis.
#70 The Residential Market
We seek to understand the relationship between the new and the existing home market—the different flows and inventories that shape both. We analyze how imbalances in one market affect the other.
#68 Spot federal rate spread vs. PCE inflation rate
We analyzed the intermarket capital flows that took place in the week of September 17, following the rate cut. We looked at the effects they generated, where they occurred, and with what volume. We searched and found where the volume moved that week.
#67 Labor Market and Consumption
The connection between consumption and the market may seem direct. It isn’t quite so since the state has also intervened in this market. Here we explain the market’s causalities. We break down Nonfarm Payroll to show why it fails as a true measure of employment, and finally, we lay out a concrete technical setup.