SummaryYou have just been adopted by a new rich uncle.
I doubled my short position in the US Treasury bond (TLT) market today.
I’ll be using any subsequent price rise to sell more bonds, roll forward puts and put spread options, sell short bond futures, and buy the Ultra Short Treasury Bond (TBT).
It is undoubtedly the cleanest trade out there in the world today. Of all the momentous changes in the prospects for asset classes as a result of the presidential election, bonds absolutely top the list. And not just US bonds, but German, Japanese, British, and every other kind of bond out there in the world as well are exiting a 30-year bull market and entering a 20-year bear market.
…related:
Bond Carnage hits Mortgage Rates. But This Time, it’s Real
One week after the BIS issued an unexpectedly stern, if completely ignored warning, that the surge in the USD is leading to an abrupt tightening in financial conditions around the globe, making the repayment of trillions in USD-denominated cross-border debt increasingly more difficult and suggesting that the Dollar index itself is the new “fear indicator”, overnight another central bank, the European Central Bank warned that the risk of “abrupt” global asset market corrections “have intensified” on the back of rising political uncertainty, posing a threat to banks, stability and economic growth.
…related:
As The Monetary Madness Continues, What Is Happening Is Stunning…
The Credit Bubble Peak was Marked by “Totally Crazy Lending.”
Debt is good. More debt is better. Funding consumer spending with debt is even better – that’s what economists have been preaching – because the consumed goods and services are gone after having been added to GDP, while the debt, which GDP ignores, remains until it is paid off with future earnings, or until it blows up.
Corporations too have gone on a borrowing binge. Unlike consumers....continue reading HERE
…related:
If you’re serious about making money from investing in the financial markets, you need to be able to read the crowd… and go against it.
Let me give you an example… Currently one of the consensus views is that the Gold rally is over and gold is dead as an investment.
Right off the bat, you know this sentiment is at an extreme. Despite its recent sell-off, Gold is still crushing stocks in terms of performance year to date.
This is a massive “tell”: people believe Gold is doing very badly when in reality it’s nearly doubling stocks’ performance year to date.
Another “tell” is technical in nature. Investor sentiment is acting as though Gold is dead… when in reality Gold is both oversold and about to stage a bullish crossover (when the 50-wma breaks above the 200-wma).
Put another way, Gold is due for a snapback bounce at the very least… at the exact same time that it’s about to stage a massively bullish long-term signal.
This is a textbook recipe for a “rip your face off” rally.
Again, with Gold today we’ve got:
You can ignore this all you like. But all of the above suggest Gold will be much higher in the coming weeks.
Best Regards
Graham Summers – Phoenix Capital Research
….related:
In 2006, in the middle of one the hottest years on record for Canadian housing, then Bank of Canada Governor David Dodge sent a testy letter to his counterpart at the country’s mortgage insurer warning about lax standards fueling demand for homes. Today, Dodge has new words of caution: worry more about supply.
“It’s not very complicated: there’s a supply curve, there’s a demand curve. If you restrict that supply curve then don’t be surprised by high prices,” said Dodge, who over four decades as a public servant worked at the Canada Mortgage and Housing Corp. and headed both Canada’s finance department and its central bank.
While Finance Minister Bill Morneau’s recent measures to cool Canadian housing markets are only the latest in a decade-long effort to stem demand, beginning with Dodge’s letter, they have also begun to reveal something else: the federal government’s waning ability to solve the problem.
…related:
Real-estate reform: What you need to know about Ottawa’s overhaul
I know Mike is a very solid investor and respect his opinions very much. So if he says pay attention to this or that - I will.
~ Dale G.
I've started managing my own investments so view Michael's site as a one-stop shop from which to get information and perspectives.
~ Dave E.
Michael offers easy reading, honest, common sense information that anyone can use in a practical manner.
~ der_al.
A sane voice in a scrambled investment world.
~ Ed R.
Greg Weldon
Josef Schachter
Tyler Bollhorn
Ryan Irvine
Paul Beattie
Martin Straith
Patrick Ceresna
Mark Leibovit
James Thorne
Victor Adair