Archive for June, 2019

Notes From Underground: When a Slower Fool, Always Look on the Bright Side of Life

June 30, 2019

First things first: There were no surprises out of the G-20, at least for those who read Notes From Underground and listened to the discussion that took place in the Whitewave Trading room. The most significant outcome was that President Trump held off from installing additional tariffs while President Xi confirmed that China would be buying more U.S. production, especially in the agricultural sector. In Thursday’s podcast with the Whitewave participants I advised that with the current weather problems in the U.S. heartland the Chinese would have to be vigilant about the cost of global grain prices rising as supply was hampered by poor planting conditions.

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Notes From Underground: G-19? Wherefore Art Thou AMLO?

June 27, 2019

We at Notes From Underground are keeping it short tonight, but including a link to a podcast I recorded with the White Wave Trading. I sit down with the group one or twice a week in order to analyze potential trading opportunities. Thursday’s discussion revolved around potential outcomes from this weekend’s G-20 meeting in Osaka, Japan.

The major theme is President Trump and Premier Xi Jinping coming to a decision on the Chinese agricultural tariffs on American exports. Also, another issue to be raised next week: Why Mexican President Obrador decided to pass on the G-20 meeting given that there’s so much positive potential for Mexico at this meeting. Enjoy!

Click here to watch and/or listen to the podcast

 

Notes From Underground: Draghi and Trump Are Putting Powell In a Difficult Position

June 18, 2019

On Tuesday asset classes around the world got a sharp boost when ECB President Draghi delivered the ultimate dovish speech from the annual conclave in Sintra, Portugal. The ECB has set up this annual meeting in an effort to mirror the Kansas City Fed gathering in Jackson Hole, Wyoming. What did Draghi discuss? The failure of Euorpean inflation to reach the self-imposed target of 2% set by the central bank.

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Notes From Underground: Trump Has Weaponized The Dollar. Do the Longs Know?

June 12, 2019

Some shots were fired last Friday, but it seems that the markets can only hear the siren song of White House tweets. There was an important story from Bloomberg reporter Saleha Mohsin titled, “Trump’s Currency War Plan Puts Treasury and Commerce at Odds.” The article noted that “a Commerce Department proposal to impose countervailing tariffs on countries that it determines have devalued their currencies has alarmed officials at the Treasury Department.”

It appears that President Trump has grown frustrated by Treasury’s failure to name any country as a “currency manipulator.” It has been Treasury’s bailiwick to monitor the foreign exchange interventions of countries who strive to artificially hold down the value of their currencies in an effort gain a competitive advantage versus any G20 country, especially the U.S. (from the Treasury Department perspective).

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Notes From Underground: Just When It Couldn’t Get More Volatile

June 5, 2019

The above reference is from the wonderful cult movie, Putney’s Swope. The CEO of a major advertising firm has a heart attack during a board meeting and the sycophants don’t realize it as they continue peppering him with questions. When he’s unable to respond they ask, “How Many Syllables, Mario?”

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Notes From Underground: Mexico Tariffs Suffer From the Three Ills

June 2, 2019

And what might those be, you ask? Ill-conceived. Ill-timed. Ill-advised.

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