US CPI printed at 7.1% - smack dab at our forecast - but it is not necessarily a signal to buy risk assets. Margins increased when inflation was hot. The opposite will happen now.
Nice one Steno. I like and appreciate your analysis. I also agree with it. If you have not already done so, I suggest you listen to; The Final Phase of the Bear Market by Felix Zulauf. It's on Youtube via interview by Blockworks best in class, Jack Farley. Felix's economic and market outlook, as well as his call on the timing aligns with both your view and timing. Cheers, Filo
Questions: Author wrote: "...while being long bonds in the belly of the looks like a very decent bet (2s5s may steepen a tad) despite the recent surge." 1. In the belly of the....what? Omitted word? Typo? 2. Once typo corrected, please clarify what kinds of bonds you favor. For example, if you meant to say something like "in the belly of the CURVE" , then what type and duration of bonds are you favoring ? For what length holding period. 3. If you answer, how can I find the answer? Come back to this post in a day or so? Would I get an email notification of answer. Everyone deals with replies differently, it seems.
I think there may be a surprise with regard to the oil price in an upward direction. In the seventies, OPEC's main task was to try to ensure that the members did not export more oil than their quota, now the problem is that many members cannot produce to their quota - there is not much spare capacity.
OIL MARKET: @IEA revises **higher** its global demand growth forecasts for both 2022 and 2023 (respectively, from 2.2m b/d to 2.3m, and from 1.6m to 1.7m). India booming oil demand explains a lot of the strength.
"Another price rally cannot be ruled out," the @IEA says.
Nice one Steno. I like and appreciate your analysis. I also agree with it. If you have not already done so, I suggest you listen to; The Final Phase of the Bear Market by Felix Zulauf. It's on Youtube via interview by Blockworks best in class, Jack Farley. Felix's economic and market outlook, as well as his call on the timing aligns with both your view and timing. Cheers, Filo
Thanks for post, keep up the good work.
Questions: Author wrote: "...while being long bonds in the belly of the looks like a very decent bet (2s5s may steepen a tad) despite the recent surge." 1. In the belly of the....what? Omitted word? Typo? 2. Once typo corrected, please clarify what kinds of bonds you favor. For example, if you meant to say something like "in the belly of the CURVE" , then what type and duration of bonds are you favoring ? For what length holding period. 3. If you answer, how can I find the answer? Come back to this post in a day or so? Would I get an email notification of answer. Everyone deals with replies differently, it seems.
Great analysis. Usually, when well argued, supported by data AND against the flow, it is right as well. So, it provides insights
Så man skal først købe hus i 2028 :P
Thought-stimulating analysis.
Regarding oil, do you think promised SPR purchases will act as a floor to oil prices (~60-70$/bl) even in the event of a recession?
I think there may be a surprise with regard to the oil price in an upward direction. In the seventies, OPEC's main task was to try to ensure that the members did not export more oil than their quota, now the problem is that many members cannot produce to their quota - there is not much spare capacity.
OIL MARKET: @IEA revises **higher** its global demand growth forecasts for both 2022 and 2023 (respectively, from 2.2m b/d to 2.3m, and from 1.6m to 1.7m). India booming oil demand explains a lot of the strength.
"Another price rally cannot be ruled out," the @IEA says.
Great work Andreas 👍 Thx