Notes From Underground: So Many Insights

On October 31, I had the pleasure of the recording a discussion with Anthony Crudele and the always insightful Jim Bianco. These spots with Futures Television provide context to many things discussed in NOTES FROM UNDERGROUND. I have been fortunate to have been chosen to appear with many high level global macro analysts.

Then on Sunday, I spoke with FRA’s Richard Bonugli and Dr. Marc Faber, one of the most heralded analysts in the global macro world. We covered the important issues for fifty-five minutes. It is my pleasure to share both of these conversations with you all.

Following last week’s FOMC meeting, the yield curves have been steepening. We will discuss this in depth as it’s an important theme I’ve been highlighting for years. Enjoy the podcasts and please ask questions about any of the areas covered. Also, two questions to ponder as we motor toward the end of the year:

1. Did President Trump manipulate Chair Powell into the “three insurance rate cuts” by controlling the news media with the tariff issue? Powell stated that the FED had no way to measure the economic impact from the tariffs therefore the three cuts protected against an unknown. If this is so, can’t the White House raise the heat on tariffs in order to control monetary policy?

2. Everyone is convinced the president needs a robust equity market to ensure his reelection. Wall Street managers are banging the drums that a Senator Warren election would mean  a 25% selloff in the S&P. BUT IF WARREN IS GAINING IN THE POLLS BEFORE THE DROP WOULDN’T THE STOCK MARKET BEGIN TO DECLINE IN ANTICIPATION OF A POSSIBLE WARREN ELECTION RESULTING IN A NEGATIVE FEEDBACK LOOP FOR THE TRUMP CAMPAIGN?

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9 Responses to “Notes From Underground: So Many Insights”

  1. Srjean Dosenovic Says:

    Hi Yra,

    Long-time fan here. So, the rumour I am hearing is that the smart money is getting positioned for exactly the scenario you underlined. I am Canadian so don’t have much experience with US elections, but would you want to long infastructure (and gold)/short Amazon and USD as the Democratic primary becons? How else would you play it, as a tactical futures trader?

    Best regards from Canada,

    S

    • yraharris Says:

      Srjean—putting some scenarios together and will discuss as we proceed into the new year.But it seems the continued flow of cheap funding is pushing aside any other fundamentals—the FED has done its deed and now will wait but I struggle to get them to define symmetrical 2% inflation for it is important

  2. Adam Says:

    I think the polls closer to the election would determine if a sell-off may be coming. Right now I don’t think anyone is confident that Warren beats Trump in an election. Hence the continued rumors of Hillary getting back in. The dems don’t seem too confident in their various candidates right now in being able to beat Trump. Plus I believe the impeachment push will help Trump in the end.

    • yraharris Says:

      Adam–absolutely too early but as we see Bloomberg actually considering it so we are in the early innings in to how this can play out.Rumors will abound and of course the tweeter in chief will fan the flames –I lean in your direction that the Trump impeachment circus will aid him in the end–the outcomes of these types of political theater are as unpredictable as Brexit referendums

  3. Chicken Says:

    Now I’m wondering if central banks have loaded up on gold at the top again, in preparation for selling at the bottom.

    • yraharris Says:

      Chicken–what gives you the sense of that—in my thought the GOLD is fighting off rising equity markets while the yields are rising on the long ends of sovereign debt.Many algos are correlated to sell precious metals and buy Dollars when U.S. yields are rising —this is the correlation bias that makes everything a trade and not an investment.Several articled this weekend discussing how long equities will be able to ignore rising yields around the globe.Central banks have the ability print money so the cost of purchases of GOLD is not part of the equation..it is the ultimate paradigm of OPM

      • Chicken Says:

        One of my correlation biases is central banks selling their gold in advance of a leg up and loading their vaults prior to a leg down.

        And yes rates have risen somewhat.

    • Don H Says:

      Posted in other venues awhile back:
      /GC IF Sellers hold market below 1528, then anticipate range bound – to lower; IF 1528 goes bid before trading lower, then anticipate squeeze higher.
      Gold did trade off & bounced around in a range with the past week testing 1450 which was the lower bounds.
      Coming in to this week: IF Buyers sustain bid above 1450 anticipate trade higher; IF 1450 breaks before trading up, then anticipate more selling.
      My .02

  4. Don H Says:

    Posted in other venues awhile back:
    /GC IF Sellers hold market below 1528, then anticipate range bound – to lower; IF 1528 goes bid before trading lower, then anticipate squeeze higher.
    Gold did trade off & bounced around in a range with the past week testing 1450 which was the lower bounds.
    Coming in to this week: IF Buyers sustain bid above 1450 anticipate trade higher; IF 1450 breaks before trading up, then anticipate more selling.
    My .02

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