The Giver (Plumber)
@lazyvillager1
MF PE investor sharing views cross-assets (crypto/eq/credit) | Keynotes in highlights | Comments =/= investment advice | Subscribe:
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how did the 4 year cyclers know that every other momo asset (metals, foreign indices, AI now) would exhaust perfectly by late Sept, making BTC TINA?
where do macro folk have where we are sitting atm for imputed core PCE ? I have it 0.22-0.26 (call it 0.25) which makes it a toss-up based on Waller's guidance (not clear <=0.2, not clear >=0.3...)
or maybe there is smth i am missing
@donnelly_brent @BlacklionCTA @EconstratPB @qthomp @fejau_inc @agnostoxxx @moreproteinbars
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i’m blowing as hard as i can rn on the cpi results
Bessy is a slow escalator and it seems his cadence as of late is rolling out plans in 2 week cycles (EOM July Euro sell for JPY buy, mid-August buyback announcement, late-August Warsh, early/mid-Sept $6 BB)
think he and warsh really care about mkt feedback systems & so given that 30Y treasury auction later today will likely disappoint - admin goals here on affordability (long end for mortgages, oil for what is consumer facing) are within p95 of being irrecoverable
calling for a next stage of intervention is a futile exercise but if there were a time to go draghi mode (“whatever it takes”) it is likely soon, and in Sept
the challenge is the trickiness in timing. he may want to wait until after FOMC toward BB#2# after he made Warsh’s job harder than it had to be by intercepting b4 Jackson Hole. just really depends on if he feels like he needs to be proactive and dictate the pace
my view is that he has one bullet left. and it’s going to be big. danger in waiting too long is that mkt might continue to veer off, smth breaks, and last week of Sept doesn’t give enough time to fix things in a month ahead of middy’s. big week
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6B squishier vs where I had it (thought anything 4-5+ would be received well). Guess this range is where median had priced it (w/ expectations drift over time since)
BTC is still TINA. Though "up to 6" was written for Buyback 1, the reality is actually the reverse - in that 6 has now implicitly become the new floor given yields rejection so far (if 6 didn't work, what level will?)
Regime is now tied to the curve (both Warsh and Bessent) & there is only 1 way to detach
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RE: ongoing saga in policy from Aug+
warsh/bessent "collusion or not" is overriding most ppl's minds which makes the broader situation unclear (actually, obfuscation might be one of the goals of the admin). this is bullish as a very clear next buyer exists around asymmetry on what actually matters; specifically, 9/9 is MUCH more important for BTC/crypto than FOMC. most ppl, including most of CT, mistakenly do not see it this way
not going to gloss over the takeaways for first 2 streams (i have made them both of these free below if you have the patience to listen) but pt 1 was regarding origin of intervention and pt 2 on warsh's incoming slant for jackson hole
on how the 3rd stream is developing - punchline here is that as of mon/tues this wk, "debasement false start" view is actually slightly too early & this is actually quite a good spot to be long BTC ("TINA")
beginning-of-wk notes:
- mkt is overweight on 4B exactly as an anchor for 9/9
- my forecast is that bessent's 1st buyback on 9/9 will be of moderate scale to signal he is serious to bond bears (he just helped smoke yen shorts)
- warsh will not actually hike as mkt bear flattened for them. term premium scales down
- BTC is TINA as it is the cleanest pure-play on global yields continuing to go up. this will be better understood going into 9/9, and possibly after it
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so close but not far. in one lens, it is indeed bearish that they have to do this bc intervention shouldn’t be necessary in a healthy system. and it’s not QE. although if you’re going by that logic, then technically QE is bearish as well, since you “have to do it.” so the logic already falls apart instantly
but to explain the mechanics: it’s bullish because the paper you’re replacing is currently sitting idle. it’s unproductive. it’s money that was borrowed 20-30Y ago to find a productive source then. SLR for dealers doesn’t distinguish b/w 100M of 1Y vs 30Y paper. but 30Y paper has much higher VaR because of duration. and increasingly off the run bonds are much harder to move - in todays age, effectively toxic assets that prevent dealers from putting on new capacity.
you only need to look as far back as SVB to see why duration matters. SVB categorized its long term holdings (like USTs) as HTM, and ignored VaR so there ended up being a duration mismatch the bank wasn’t liquid enough for
this is not withstanding the fact that old treasury bonds likely have impaired rates relative to what is mkt today, which is why TIPS auctions see much better demand in auctions for issues of the same term
so yes. if you think about if from a pure $1 to $1 liquidity perspective, it’s just a swap. but it is not that simple
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This is NOT bullish. This is NOT QE. All they are doing is swapping out long end for shorter term dated maturities. I have no idea why some colleagues were so excited about this. It is BEARISH that they have to do this at all. Global trend impossible to stop.
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chumba is calling ppl “cousin” again on X dot com. last time this happened was mid- and sep 2024. noticing things
The people behind chumbawamba22 earnestly believe that unlocking the account on X could kill all financial discourse by the end of the decade. This is not a marketing stunt. If anything, many bagholders and senior KOLs will couch their phrasing in the press to sound sensible - but I hear the same people express fear privately. No other account activity poses this level of danger.
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MS paint on my understanding of what is considered routine treasury mgmt (left-hand) vs the 8/19 "Bessent put" change
RE: ongoing saga in policy from Aug+
warsh/bessent "collusion or not" is overriding most ppl's minds which makes the broader situation unclear (actually, obfuscation might be one of the goals of the admin). this is bullish as a very clear next buyer exists around asymmetry on what actually matters; specifically, 9/9 is MUCH more important for BTC/crypto than FOMC. most ppl, including most of CT, mistakenly do not see it this way
not going to gloss over the takeaways for first 2 streams (i have made them both of these free below if you have the patience to listen) but pt 1 was regarding origin of intervention and pt 2 on warsh's incoming slant for jackson hole
on how the 3rd stream is developing - punchline here is that as of mon/tues this wk, "debasement false start" view is actually slightly too early & this is actually quite a good spot to be long BTC ("TINA")
beginning-of-wk notes:
- mkt is overweight on 4B exactly as an anchor for 9/9
- my forecast is that bessent's 1st buyback on 9/9 will be of moderate scale to signal he is serious to bond bears (he just helped smoke yen shorts)
- warsh will not actually hike as mkt bear flattened for them. term premium scales down
- BTC is TINA as it is the cleanest pure-play on global yields continuing to go up. this will be better understood going into 9/9, and possibly after it
Show more
no one hates crypto more than CT
trading is trading (but i’m not a trader)
if you think a certain style of analysis or meta is inferior, then your best options are to exploit it or to not participate
forcing your moral standard on someone else is likely futile. all you can do is be you, and hope that’s enough
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