Buybacks in November & December. The wealth effect and why it means the stock market is the economy. Large money manager short positions in oil. Fewer cuts in the U.S. and more cuts in Europe.
Thanks!!. I have another question: Do you think the current position in gold is quite crowded? Although BofA September FMS mentioned that the long-only gold hedge positioning is still quite low, but the price has risen considerably in October. Do you think there's still a chance?
I think it’s getting there. Short-term extended over 200d moving average. Sentiment very bullish - gold is everywhere in the headlines. The CoT data wasn’t released on Friday because of the government shutdown - but the latest data we have was close to triggering a sell signal. I wouldn’t short it though - the market needs to display some signs of weakness first…
Thanks~~ that was an excellent response! Just two last question lol. I recall you previously mentioned that the 10y yield can be simply broken down into (Nominal GDP + Inflation). Do you still consider the current 10-year yield to be at fair value?
Also, current US consumption seems concentrated in high-income households, coupled with strong AI capital expenditure, which keeps GDP performing well. However, the labor market's demand side doesn't look as ideal. Given that the Fed doesn't seem to be paying much heed to the GDP performance, why have the medium-to-long term bonds performed better than short-term bonds recently
Don't you think there's still a chance the ECB could cut interest rates?
In 2026, yes. I don't think the Euribor Dec'25 minus Euribor Dec'26 spread is pricing enough cuts.
In ur situation, should I long 2y or 10y bund?
I don’t have a strong view on bunds - I have a view on Dec’26 Euribor futures. But 2y bunds is closer to that view than 10y bunds.
Thanks!!. I have another question: Do you think the current position in gold is quite crowded? Although BofA September FMS mentioned that the long-only gold hedge positioning is still quite low, but the price has risen considerably in October. Do you think there's still a chance?
I think it’s getting there. Short-term extended over 200d moving average. Sentiment very bullish - gold is everywhere in the headlines. The CoT data wasn’t released on Friday because of the government shutdown - but the latest data we have was close to triggering a sell signal. I wouldn’t short it though - the market needs to display some signs of weakness first…
Thanks~~ that was an excellent response! Just two last question lol. I recall you previously mentioned that the 10y yield can be simply broken down into (Nominal GDP + Inflation). Do you still consider the current 10-year yield to be at fair value?
Also, current US consumption seems concentrated in high-income households, coupled with strong AI capital expenditure, which keeps GDP performing well. However, the labor market's demand side doesn't look as ideal. Given that the Fed doesn't seem to be paying much heed to the GDP performance, why have the medium-to-long term bonds performed better than short-term bonds recently