NA

@Sherborne_Cap Been there for a while cos people keep having spectacular blow ups in the strip betting that growth will collapse and unwind any inflation spike…

@Sherborne_Cap 312? 225? Neither?

@Sherborne_Cap How’s the central risk book ?? That’s what I want to know

@Sherborne_Cap What’s ur risk case - ground invasion?

@Sherborne_Cap How come? U bullish rates?

@TraderBillyAU @Fullcarry Tks mate good weekend

@hwrtbg @Fullcarry 100% yeah its gonna require being ''connected'' to the news to hedge risk when the inevitable orange man tweets.

Not often you see STIRs trying to price hikes and cuts at the same time, but that is the current level of uncertainty. What will dominate in the next few months, inflation or a growth slowdown? Get that correct and you are golden

@TraderBillyAU @Fullcarry More hawkish now more dovish later. Just need the front fixing to be soon enough that you still capture the hawkish bit, and don’t get killed in a massive bull steepening :)

@hwrtbg @Fullcarry U6M7 could trade -25 ,-50, -75, -100 which will all be a function of macro (obv) the hawkish nature of today->August

@TraderBillyAU @Fullcarry Hadn’t seen that, also hadn’t seen u6h7 is at par. Quarterly spreads are pretty symmetric, i.e. after u6h7, u6u7 adds 9bp flattening, u6z7 another 9bp… it still doesn’t seem like much

@hwrtbg @Fullcarry i short U6/M7 (check out where M6/H7 was 27th feb)

@TraderBillyAU @Fullcarry U think Z6z7 and the like have more flattening in them then??

@AitkenAdvisors Venezuela? Brute force?

“Oil curve control” I wonder whether people have read, and then understood paragraph four. “Has arranged”: how? energy.gov/articles/unite…

@macrogliblyglo1 Is this that surprising? People fighting the last war and demand destruction argument didn’t matter in Covid

What’s crazy is seeing a lot of market participants basically embrace the trichet argument from 08: oil is inflationary & should ignore the demand destruction aspect which means taking all cuts out if curve & in some cases hike. Good luck with that

@Sherborne_Cap Lol and guess what’s all working today…. Long commods long risk short bonds A legend for a reason

@Sherborne_Cap That’s what I thought when listening to the bond bit… he explained it and I thought yeah but that’s not a portfolio hedge?

@dMacro_dBS @rev_cap But why would bull flattening be wrong in this scenario?

@rev_cap 2 weeks ago when 10y was ~4.25%, if you had polled 100 rates / macro PMs and sellside traders and asked what comes first, 4.5% or 4.0% on the 10y, at least 90 of them would have confidently picked 4.5%

This rally and the bull flattening across the US rate curve have been absolutely brutal for most macro pods and the usual sellside monkeys like GS, Citadel Securities, etc… cant remember the last time consensus ex ante market views were this out of sync vs actual price action.

@Sherborne_Cap Sorry for naivety but what does this have to do w the debasement trade?

@Sherborne_Cap What’s the crack with this plumbing wise though - can they actually shrink the b/s much? Or you saying they’ll just switch it to bills and so even if size isn’t changed much, curve still steepens and risk craps it?

@macrogliblyglo1 What part of the labor market? U3/u6 trending higher? I’m not so sure given direction of claims and resilience of consumer + capital spending

The economy and more specifically the labor market will determine Fed policy. Warsh isn’t going to be able to command the committee as past chairs. The labor market however looks like it could give impetus to cuts

@Sherborne_Cap Then their economies tank and people forget why they did it and are just mad they have no jobs

@Sherborne_Cap @ALBACapMgmt Makes sense tks for explaining mate

@Sherborne_Cap @ALBACapMgmt Why would the high cash px protect you from a short perspective? Understand you’re long a higher convexity bond in the 39s (per unit duration)