Alex Barrow

1/ Druckenmiller's first mentor, Speros Drelles, would often tell him that "60 million Frenchman can't be wrong." Here's a thread on what that means and how to know when you should listen to or ignore the "Frenchman" (market)...

For the first time this cycle, the implied December 2027 SOFR rate is above the current Fed Funds Rate. The rate cut cycle is officially in question.

As Cisco gaps higher following earnings after the close, I wanted to share the following excerpt from a technology report released last week. "While it is debatable what inning we are in the AI era, one thing that has yet to materialize is a Lucent-style moment. In fact, Alphabet raised its capital expenditure guidance in its most recent earnings report".

Great weekly read from @MacroOps this week. A couple updates on what we've been doing: > Trimming positioning in AI/tech names like $INTC > Adding to inflation positions like copper, wheat, and oil Really just trying not to do something stupid with the gains we've made.

The COPX/SPY chart looks fantastic. Textbook pullback to the breakout line from a long base. Avoid the intraday noise. There is so much room to run here if we get a reversal higher. Got Copper?

Unintended consequences of war in the Gulf: Japan’s most famous potato chips brand will change packaging to black and white due to shortage of petroleum-based colourants

"Equity allocation just hit its highest level in five years. April marked the biggest monthly shift since November 2020" State Street via @MacroOps

This (arabnews.com/node/2642938) is, by any measure, an extraordinary article: Prince Turki Al-Faisal is a son of King Faisal and ran Saudi intelligence (the GID) for over two decades. He is writing that the plan of "the US-Israeli war on Iran" was "to ignite war between us [Saudi Arabia] and Iran," so that Israel could "impose its will on the region and remained the only actor in our surroundings." This further confirms that, contrary to what many have asserted, the notion that the Saudis were quietly backing the war on Iran was a myth (alongside the recent fact the Saudis denied the U.S. access to its bases and airspace: x.com/RnaudBertrand/…). From the horse's mouth they're literally saying it was as much a war on them as it was on Iran! Pretty crazy when you think about it: this is Saudi Arabia saying that their real enemy in this war was the U.S. and Israel. Hard to overstate how significant a rupture this represents. Now of course they could be saying so because, seeing how the war turned out, they're trying to retroactively position themselves on the winning side (at least strategically, by saying they didn't take the bait), or trying to justify domestically why they absorbed hits from Iran without retaliating. And, of course, it's not like they're presenting Iran as some sort of ally here: Prince Turki explicitly calls them a "neighbor" that caused "pains." But still, the end result remains: the Saudi establishment is now committing, on the record and in plain language, to a framing in which, while Iran is a "painful neighbor", the U.S. and Israel represent the deeper strategic threat, having tried to engineer their destruction. If you had any lingering doubt that this war accelerated the collapse of U.S. influence in the region, this should settle it.

BREAKING: The US Strategic Petroleum Reserve released last week >1.22 million barrels a day (~8.6 million for the week). That's the largest ever weekly release, surpassing the peak rate seen in 2022 when President Biden tapped the SPR after Russia invaded Ukraine.

The health care equipment sub-industry group has been under substantial pressure. Several relative performance time frames are now sitting at or near all-time lows.

Fruits & vegetables likely account for a majority of people's dietary microplastic and PFAS intake. What’s frustrating is that this isn’t something you can just rinse off. In many cases, the contamination appears to be taken up into the food itself. Organic may reduce some of that exposure, but even organic farms can be affected when they’re near contaminated land or water. Should you stop eating produce? No. We should be much more upset about how widespread these chemicals have become, especially when children are being exposed through foods we otherwise consider healthy. One practical thing I think is worth considering is beta-glucan. There’s some evidence it may help support the excretion of PFAS, and given how unavoidable these exposures are becoming, that may be a useful tool, especially for families who can’t realistically eliminate every source.

@davevermilion From a report last week.

"Many of the most challenging problems traders face is not simply fear or greed, but the emotional impact of loss and gain.  What brings many traders to their craft is also what brings many people to a significant romantic relationship:  a dream.  How do we respond when that dream changes?  When it is lost?  How do our responses to loss impact our subsequent trading?  Our lives?  Our future ability to dream?"

It would take the CFTC about 5 minutes to figure out who this was and whether there was any misconduct, assuming they want to.

@m0d3rnpr0bl3ms looking unlikely in near term

@MacroOps Oil ever gonna have a lockout rally or short to zero

As wild as things may seem, markets tend to go further than most expect. SDLI, one of the iconic Dotcom-era momentum stocks, advanced 865% in the final six months. If you measure from the LTCM low, it gained 4300%.

This is indefensible: Spraying glyphosate over wild lands is ecocide, and toxic to humans, of course. But there is one upside: It allows us to see the full corruption of our system, which pretends to be preoccupied with our health, even as it poisons the world behind our backs.

Tom clued me into this a number of years ago. Here's a look that goes back farther and highlights a couple of other times when it's been valuable (2018 and 2022). Nothing's perfect but this one should be on your watch list IMO.

The Two Different Paths: We are about to find out which path we are on.  As I said in my last note, from my conversations with a number of world leaders in a number of countries, and as seems obvious to me, there will either be a) a U.S. win over Iran, which will require taking control over the Strait of Hormuz and assuring that Iran's nuclear program is dead—i.e., defanging Iran, or b) a U.S. loss, which is the result if these things don't happen. Most senior policy makers I speak with believe that we are likely headed down the b) path and that will be made clear soon. It needs to be made clear soon because continuing on the current path or being more forceful will cause sharp increases in oil and gasoline prices and great difficulties during the high travel season, bad political consequences for President Trump, and difficulties in his upcoming meeting with President Xi in China. So, we should have that verdict soon. The perception that the b) path is most likely is already leading to a view that the United States will not be a reliable protector against possible opponents like Russia in Europe and/or China in Asia, and that is already leading to actions being taken that are sensible in light of that belief, like leaders paying "tribute" visits to China. As explained before, this set of circumstances is likely to have some analogous consequences to Great Britain losing the Suez Canal in 1956. By the way, this is also happening at a time when China is earning huge amounts of money through its very strong exports—so much money that it is difficult for those Chinese earning the money to know what to do with it. This is making China a very important player in world capital markets as well as world trade. In other words, these events are making China geopolitically and financially stronger.