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Trump’s triumph is testament not only to the inadequacies of the Democratic campaign and the electorate’s dislike of inflation, but to the popularity of populism globally
Trump trades likely to continue at least until inauguration, and conceivably thereafter – unless a bond rout stops them first
The right places to position are America-first trades which will benefit from – or at least withstand – higher term premia
The election remains too close to call
But market pricing has moved decisively towards Trump
Take profit on Trump trades – or use options instead
Full replay of 16 Oct webinar
Markets’ aggressive pricing of a soft landing is matched only by central banks’ determination to provide it
Yet their dovishness masks a switch from rate tightening and balance sheet easing to rate easing and balance sheet tightening
The resultant uncertainty is largely reflected in rates – but leaves opportunities in other markets
Open to clients with Group Webinar or One-on-One subscriptions; Read-only clients have access to first section only
Free excerpt from 16 Oct webinar
Markets’ aggressive pricing of a soft landing is matched only by central banks’ determination to provide it
Yet their dovishness masks a switch from rate tightening and balance sheet easing to rate easing and balance sheet tightening
The resultant uncertainty is largely reflected in rates – but leaves opportunities in other markets
Available to all; full replay available only to clients with Group Webinar or One-on-One subscriptions.
Markets’ aggressive pricing of a soft landing is matched only by central banks’ determination to provide it
Yet their dovishness masks a switch from rate tightening and balance sheet easing to rate easing and balance sheet tightening
The resultant uncertainty is largely reflected in rates – but leaves opportunities in other markets
The 25 vs 50 rate cut debate has unsurprisingly been focused on the economy
But the greater importance lies in the signal the Fed would be sending to markets
Leading with a larger move risks reigniting financial exuberance
Over the past week central banks drained $300bn in liquidity: as much as in April and more than in August
While this was partially reflected in the post-Labor Day selloff, the risk is of more to come
Resilient fund inflows are a partial panacea, but risk simply lagging
The best explanation for markets’ summer slump and rapid rebound lies neither with rates nor with the economy
It sits – yet again – squarely with swings in central bank liquidity
While the resilience of fund flows and cutting of leveraged positions is somewhat reassuring, on balance we still see the support as temporary
Attempting to explain the market bounce in terms of economic data fails to do justice to the prior sell-off
Flows & liquidity indicators once again shed light on the moves
On balance they leave us skeptical
The increase in VaR is sparking a broad-based, and potentially indiscriminate, unwinding of leveraged positions
The first question is which other leveraged positions are at risk
The second question is whether fund flows will hold up
Central bank rescue easing or liquidity packages are likely only with a much bigger sell-off or more obvious signs of systemic leveraged distress
