Archive for the ‘Currency’ Category

Notes From Underground: Conversing With Dr. Anas Alhajji

September 25, 2022

As I go into hiatus I am posting a PODCAST recorded on September 20 with world renown Professor Dr. Alhajji, in which we discuss global energy and its implications on global politics and finance. The Financial Repression Authority, under the auspices of Richard Bonugli, has provided a wonderful platform for allowing me to discuss the most relevant global macro topics with the leading thinkers in the realm. The wisdom of Mr. Bonugli allows for ferreting out investment ideas — both long and short — to help provide insight and profit for readers of NOTES FROM UNDERGROUND. Enjoy the podcast and I look forward to writing after the period of the Jewish Holidays as I’m in need of deep introspection. Wishing those who celebrate a coming year of health, peace and prosperity, and for those of other beliefs I wish you the same.

— Yra

Click on the link to view the podcast.

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Notes From Underground: Take Jerome With a Big Grain of Salt

September 20, 2022

A quick view on Wednesday’s FEDERAL RESERVE‘s meeting: According to the newest Fed stenographer, Nick Timiraos, look for the central bank to raise rates 75 basis points in an effort to get ahead of the curse of HEADLINE inflation. This level is baked into the present market values. Look to see if there is any discussion of slowing the FED FUNDS increases as the FED tries to get a handle on the impact of $95 billion a month balance sheet unwind and a DOLLAR that has risen 14% since the beginning of the year, and more than 20% versus the Japanese yen.

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Notes From Underground: Another Day, Another Podcast

September 14, 2022

It was a fortuitous day that Richard Bonugli arranged a podcast with Joseph Wang, author of the Fed Guy and an former employee of the New York Fed’s System Open Market Account (SOMA). The podcast was recorded 90 minutes after the release of Tuesday’s CPI data so there was much to discuss in real time about FED policy, the recent moves in the SPOOs, dollar, commodities and precious metals were all reversed because the MARKETS seemed to have been caught off guard by a much higher number than Wall Street pundits anticipated.

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Notes From Underground: We’re Back?

August 1, 2022

It has been quite an extended period since my last post, but now I’m trying to catch up on some reading and relevant research on all things pertinent to GLOBAL MACRO. Following the FEDERAL RESERVE’S INTEREST RATE DECISION and the POWELL PRESS CONFERENCE, I sat down with Richard Bonugli, Peter Boockvar and Daniel Lacalle. This 66-minute podcast is packed with several pertinent topics, including yield curves, the dollar, Europe and even ESG investments.┬áPlease enjoy and I await your feedback and hopefully disagreements. Only the parochialist in echo chambers pursue validation.

Click here to listen to the recording.

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Notes From Underground: Could Paul Volcker Find His Inner Volcker In This Environment?

May 22, 2022

Since the Zoltan Pozsar challenged Federal Reserve Chair Jerome Powell to find his inner Paul Volcker and raise interest rates high enough to bring the inflation expectations to heel. (He argued draining liquidity and raising rates to a NEUTRAL level OUGHT to be the medicine needed to truly render the current high inflation levels TRANSITORY.) Last week, Pozsar pushed on the theme again with a piece titled, “Ride of the ‘Volkyries'” in which the issue of financial conditions tightening is discussed in reflection to current FED policy of curbing inflation through the crushing of demand.

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Notes From Underground: Into the Weeds on Yen/Yuan

April 28, 2022

In the first post about the YEN/YUAN, we discussed the current significance of the cross, and with it a rising dollar. Now we will provide CONTEXT and NUANCE as to the backdrop of this cross’s significance. It is easy to forget that the Chinese economic miracle is only 40 years old as it began under the direction of DENG in 1978-79 and his rise as China’s leader. By 1994 China is beginning to feel the positive effects of Deng’s policies of white cat/black cat in pursuing modernity and western-style economic growth.

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Notes From Underground: The Meaning of the Yen/YUAN Cross

April 26, 2022

In the past three weeks I have had the pleasure of doing two major podcasts with two of the most highly regarded global macro thinkers and traders: Zoltan Pozsar and Louis Gave. Our discussions led to an attempt to explain the importance of the Chinese yuan during the current period of CAPITAL ANXIETY. During the past two years the Chinese YUAN has rallied from 7.13/dollar to 6.35, where it has sat for the last six months (a gain of 12%). And, as I have argued for the last 18 months, the strengthening YUAN during the pandemic was a signal that the Chinese were shifting to a more domestic-oriented economy using a stronger currency to enrich its nascent middle class.

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Notes From Underground: Are Central Banks the Grand Illusion?

April 1, 2022

This week I had the extreme pleasure of recording a Financial Repression Authority podcast with Zoltan Poszar (moderated by Richard Bonugli, of course). We covered the entire global scene from yield curves, petro dollars and the underlying basis to all fiat money transactions. It is worth a listen to learn that the fabricated, algo-driven headlines are not the contextual basis of major shifting sands in the global financial system. There is far more nuance locked underlying the moves by policy makers around the world.

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Notes From Underground: Get Smart

March 13, 2022

There are so many things to consider when trading in the current climate. First and foremost, CAUTION is the key word, not FEAR. As Billy Joel would say, “We didn’t start the fire,” but as traders and investors we have to dance on the embers. The trading environment is dangerous because the algo-driven trading shops are being bombarded with an endless flow of headlines and outlets fighting to be the first to report any news story. Let the speed merchants draw markets to levels where risk can be measured rather than trading just to trade.

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Notes From Underground: A Quick Hit On the State of Chaos

March 6, 2022

First, our hearts go out to all suffering in the world of insanity brought on by senseless wars that diplomacy OUGHT to have been able to prevent. The world always returns to the insanity that brought us to World War I when nobody could stop the trains once set in motion. As Phil Ochs sang, “It’s always the old who lead us off to war, it’s always to fall, look at all we won with the saber and the gun, tell me is it worth it all?” But here we are and as always the world continues to focus on the minutiae of life, including the financial outcomes responding to the high-speed headlines driven by algorithmic speed machines. There is no context to any news just manufactured volatility fabricators of the latest musings of some “news” outlets’ favorite expert. But as Hyman Roth said so clearly: “Michael this is the profession we have chosen.”

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