Triple_Bagger said:

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BaylorSpineGuy said:

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10Y yield falling pretty good now. Down 3.506 today.

Falling yield…..may mean a few things. Fed about to pivot, which is not historically bullish. May signal a recession very soon. Fed funds rate now above 10Y Treasury yield.

Big money buys bonds for safety plus small interest income.

Curious to see what exactly happens here next.

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Fed is not pivoting. Every Fed speaker has said no pivot but no one believes them. Barr just said a few minutes ago:

IT IS A MISTAKE TO BELIEVE THAT CHANGES IN THE PACE OF RATE HIKES INDICATE A SHIFT IN THE FED'S COMMITMENT TO A 2% INFLATION TARGET.

THE FED'S POLICY RATE WILL HAVE TO REMAIN HIGH FOR AN LONG PERIOD OF TIME.

WE AREN'T THINKING ABOUT LOOSENING.

We will be in a deep recession before a pivot.

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I understand what you're saying but it has historically been the other way. Major recessions and drawdowns in equities occur after the pivot!

I'm proposing reasons as to why 10Y bond has dropped almost 25 bps in a week without barely a mention. It could be recession, and it could mean a return to more normal interest rate levels. It's the reason to have a discussion…:-)

J Pow has mentioned "demand destruction" more than once. The fastest way to reign in consumer spending is by crushing the stock market.

BaylorSpineGuy said:

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Triple_Bagger said:

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BaylorSpineGuy said:

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10Y yield falling pretty good now. Down 3.506 today.

Falling yield…..may mean a few things. Fed about to pivot, which is not historically bullish. May signal a recession very soon. Fed funds rate now above 10Y Treasury yield.

Big money buys bonds for safety plus small interest income.

Curious to see what exactly happens here next.

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Fed is not pivoting. Every Fed speaker has said no pivot but no one believes them. Barr just said a few minutes ago:

IT IS A MISTAKE TO BELIEVE THAT CHANGES IN THE PACE OF RATE HIKES INDICATE A SHIFT IN THE FED'S COMMITMENT TO A 2% INFLATION TARGET.

THE FED'S POLICY RATE WILL HAVE TO REMAIN HIGH FOR AN LONG PERIOD OF TIME.

WE AREN'T THINKING ABOUT LOOSENING.

We will be in a deep recession before a pivot.

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I understand what you're saying but it has historically been the other way. Major recessions and drawdowns in equities occur after the pivot!

I'm proposing reasons as to why 10Y bond has dropped almost 25 bps in a week without barely a mention. It could be recession, and it could mean a return to more normal interest rate levels. It's the reason to have a discussion…:-)

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What an amazing case of "zoom in please!".

The FED does not lead. The market leads and the FED follows the market. Forget about equities. The bond market tells the FED what to do.

The 10-year is in a needed retracement cycle after topping out and on cue, there's talk of the FED "slowing the rate of hikes". Sorry, but the 10-year has been falling for two weeks already.

Got busy with work today. Pretty meh market day today

Hmmmm

Daily



Weekly

Current ES Futures action. Watch the white SR and more importantly red SR…..unless this pivots above trendline.

Which poster was it that brought up the amount of job openings in contrast to the Fed's comments about job destruction (in essence).

If the market keeps adding jobs rates will continue up, according to that post. Still, lots of jobs to churn through to lower inflation. Remember kids, take your vitamins to stay healthy and FJB.

The labor market is ultra solid, all the layoffs are just going to be moving to other market segments. Unsustainable and dying business models are shedding because capital is more expensive with the rising rates, but most places with a solid model are fighting a massive talent and labor shortage. Still a great time to be job hunting. It's why the inflation isn't gonna be going away any time soon. You can't curb inflation with a job market this solid. You need much, much higher levels of unemployment

The market has been giving me the middle finger lately

It's amazing: we had a casual discussion here after last months job numbers, on how we can't have a weak labor market with

1) High inflation that social safety nets are continuing to lose purchasing power in
2) 10 million open jobs

Even with social media dropping hundreds of thousands of employees, they need to eat and pay for gas, and there are 10 million jobs open. Sure tech wasteoids aren't going to work at Whataburger, but 10 million job openings indicates there is a massive, broad spectrum of jobs available.

The FED is showing itself to be rather feckless in its fight against inflation in its attempt to destroy jobs and destroy demand. There is simply too much liquidity on companies balance sheets to flip the script on the job market. To me, the fight against inflation is still going to be won by destroying jobs, but the FED won't be the catalyst, despite their best efforts. Jobs will be destroyed when Biden stops the SPR drain and we start replenishing the reserves while simultaneously trying to meet current demand. All while OPEC slashed production to prop up price.

$125 oil and $5 per gallon gas will destroy jobs. Until then, CHOP as the FED refuses to admit its actions are just affecting paper values on Wall Street.

Welcome aboard (only it wont be $5 gas...it will be a much higher national average)

I've posted this a few times before and I'll post again. If energy had been allowed to run its full price escalating curve, it would have slowed the economy on its own. There would have been no need for rate hikes and everything that came along with it. The rigid support for Green Energy policy caused every bit of upheaval we are now going through. I'm not against renewables, but there was no transition plan, obviously. Right now, Putin is standing in the way of Green Energy globalization.

Farmer @ Johnsongrass, TX said:

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Welcome aboard (only it wont be $5 gas...it will be a much higher national average)

I've posted this a few times before and I'll post again. If energy had been allowed to run its full price escalating curve, it would have slowed the economy on its own. There would have been no need for rate hikes and everything that came along with it. The rigid support for Green Energy policy caused every bit of upheaval we are now going through. I'm not against renewables, but there was no transition plan, obviously. Right now, Putin is standing in the way of Green Energy globalization.

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Russia oil price cap: G-7 outline how it is going to work (cnbc.com)

Quote:

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The European Union on Friday agreed to cap Russian seaborne oil prices at $60 a barrel, after several days of intense negotiations over an appropriate level.

The announcement comes after the G-7 group of advanced economies agreed back in September to impose a limit on Russian seaborne crude and therefore constrain revenues the Kremlin makes from the commodity. However, details on how the cap would work in practice have been debated and hashed out since that point.

Russia, amid its onslaught in Ukraine, has warned that an oil price cap could wreak havoc on the energy markets and push commodity prices even higher.

The price cap will be reviewed regularly to monitor its market ramifications, but it should be "at least 5% below the average market price," an EU document with details of the cap said.

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Charismatic Megafauna said:

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Are you gas traders playing boil with options or just shares?

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I usually play shares. Option prices are always juiced because of how volatile nat gas is. Great one to sell CCs on if you can get shares for cheap.