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@VolatilityWiz Long Gamma whenever it is cheap. 😜

SPY up 9.5%, QQQ up 12% today? Congrats, you just got a hella hit of intermittent reinforcement — the dark psychology that keeps people hooked. 🎰📈

This is only the 2nd inning, folks. Using the 2008 analogy, right now is the March weekend when Bear Sterns collapsed, and the Fed had to step in to intervene. But primary dealers are okay. GSIBs are okay. There will be NO monday-premarket 75bps emergency rate cut this time.

"Out of control #starship8". Taken in Miami, FL around 640pm ET Not too dissimilar to the stonks.

In the meantime, $AMSC will probably become the new GME. Skyrocketing first due to its name, before dropping to 0, since it has zero patent related to LK-99.

The betting market agreed with me too quickly. Time for additional contrarian opinions on superconductors: 1. high-quality (convincing) data and sample will take times (>>10 days). 60 days are more likely. The fog of war will prevail for a while. 2. most existing superconductor researchers (mostly physicists, materials scientists to a lesser degree) are very bitter now. Consider their emotional bias, before taking their opinions too seriously. 3. The low-hanging fruits (bets with the highest ROI in the 2-3 year time frame) will be in mundane applications that are already ubiquitous. Forget about nuclear fusion, quantum computers etc (none of these will make money in the next 10 years) I will expand on all these points tomorrow, especially on point no.3

@Evan_ss6 long manufacturing names, defense too.

@Barton_options Long lead producers, short energy?

The superconductor candidate last week, LK-99, looks like a GAME CHANGER.

@logUp12 thanks! long story though. will write up something later this week about it. so much to write about. most people are doing the Fed QT trade incorrectly.

@Barton_options Hey glad to see you back. Where were you last 2 years ? Are you still trading ? what happened to your newsletter ?

@Zonacats1 superconductor for sure. once realized at room temperature, it will buff performance of nearly all electrical devices and will enable a lot of new magnetic devices. quantum computing still has to deal with decoherence problem at room temperature.

@Barton_options what makes you more excited? superconductors or quantum?

You probably want to reposition your portfolio to take this possibility into account .

It will take materials scientists a few months to fully settle the question on whether LK-99 contains room-temperature (RT) superconductors. But even if it were not, this new material should give enough hints for genuine RT superconductors to be synthesized soon after.

The whales that would have moved the needle are WFC ($350Bn) and BAC ($850Bn). But they are probably too big to fail in the foreseeable future.

PACW has only $4Bn of UST/MBS and WAL has $3Bn of MBS. Should they fail, the increase in Fed's balance sheet would be negligible Since a portion of the liquidity from TGA (debt ceiling) is going into Overnight Reverse Repo, the liquidity tailwind for May is only about $100-150Bn

We now know who was the biggest user of the Discount Window (90-day loan facility at the Fed): FRC. When FDIC took over, $58Bn of those were reclassified as Other credit extensions. and JPM closed some positions. Overall Fed's balance sheet did not expand from FRC failure.