Daily Briefing – March 17, 2020

Published on
March 17th, 2020
19 minutes

Daily Briefing – March 17, 2020

Daily Briefing ·
Featuring Ed Harrison and Roger Hirst

Published on: March 17th, 2020 • Duration: 19 minutes

With markets and headlines moving faster than ever, we are now bringing all Real Vision members a new ultra-timely show to help you keep up with the dynamic news cycle. Real Vision's Daily Briefing will be filmed Monday through Friday after the US market closes at approximately 4:15 p.m. ET and released that same day, with the goal of having the show out before 6:00 p.m. ET. The show will always feature a host from Real Vision and a guest, sometimes a member of the editorial staff, and sometimes a contributor from outside of Real Vision. You can expect the show to be approximately 15-20 minutes in length, to cover the important developments from the day, and to tie these recent events back into the durable themes and long-form pieces that are core to Real Vision's coverage and analysis. Please note that from 9 a.m. to 6 p.m. you will see a short 1-minute video in the place of that day’s episode. This clip serves as a placeholder for the day's video — so that the minute the actual episode is ready to air, we can swap the placeholder out and get the Daily Briefing to you as quickly as possible.



  • DS
    David S.
    19 March 2020 @ 00:50
    If the markets need to close for a short time because of technical reasons, that is OK. It would be a travesty to close the markets because someone thought it was a good idea! The US is not the third world. Did we close the markets when they went up day after day with no good news and even bad news. The markets need to unwind all the stupidity that has been norm for the last ten years. People will need money to pay their bills, buy food, etc. If you close the markets you will hurt even more people. Let it be. DLS
  • GT
    Guillaume T.
    18 March 2020 @ 21:29
    Thanks for the positive note! Super nice to have those daily discussions published. Great to learn and build ideas.
  • OR
    Otto R.
    18 March 2020 @ 07:40
    Great overview of the liquidity situation. Will long dated UST, a risk off asset normally, continue to perform bad on the back of this liquidity squeeze? Thanks for your time
    • OR
      Otto R.
      18 March 2020 @ 07:49
      I saw Roger H answered re 10y UST below. I guess I just wonder if long dated UST s are going to continue sell off as the prompt market and real economy sucks more and more cash?
    • RH
      Roger H. | Real Vision
      18 March 2020 @ 08:46
      Here at 8am UK time (European open) - long end US yields shoot up again, USD rallies, equities sell off. Funding still an issue (TED Spread wider again yesterday e.g. 1mth govt vs 1mth LIBOR). 3mth USD JPY basis (swaping JPY into USD) still gyrating wildly. This all looks like funding/VAR/smart beta blow up
    • OR
      Otto R.
      18 March 2020 @ 18:52
      Thanks a lot
    • JC
      John C.
      18 March 2020 @ 20:28
      General question: rumour mill has it that one of the big guys are imploding now hence this bond market disruption. Likely candidates are Citadel, Bridgewater, Millennium, AQR, 2 Sigma & a few others. Forced liquidations. Any insights from the Realvision grapevine and will we ever even know? Also would be interested in your views on Eurodollar futures given how they have actually moved down despite the 100 bps Fed cut on Sunday. Realize the dollar squeeze is a big deal, but will the swap lines help alleviate the tension eventually? Thanks.
  • JC
    John C.
    18 March 2020 @ 20:21
    Thanks guys this was a very helpful 10,000 foot overview that puts a lot of this in perspective. Clearly somebody blowing up (Bridgewater? Millennium? Citadel? etc. etc.) and the risk parity guys offloading asset en masse. Today Treasurys, gold and stocks down again and Eurodollars also hit a bit. Roger's last part was VERY important as we have options expiration this week.
  • JB
    John B.
    18 March 2020 @ 18:24
    Please bring Brent back on for an interview, he called this a while back.
  • GG
    Gary G.
    18 March 2020 @ 15:42
  • PJ
    Peter J.
    18 March 2020 @ 15:29
    Great series, love it.
  • TM
    Thomas M.
    17 March 2020 @ 22:40
    my doctor just told me in Dallas TX this is media fear and the virus will die off in the summer! this is a doctor we are in deep shit!
    • JO
      JOHN O.
      17 March 2020 @ 22:59
      I'd consider changing docs if I were you.
    • SH
      Scott H.
      18 March 2020 @ 03:26
      Probably the same kind of doctor that still smokes and is overweight.
    • WM
      Will M.
      18 March 2020 @ 14:33
      Trouble is there are plenty of other doctors saying the opposite. My doctor also said he thought this was a media driven crisis and it wasn't that much worse than flu. Are our governments and their advisers really that poor...... They must know that the impacts of economies are huge. Are the Italian reports "exaggerated" and media report and health worker reports wrong?
  • PG
    Philippe G.
    18 March 2020 @ 14:08
    Excellent, the Ed-Roger combo delivers!!!
  • DJ
    D J.
    18 March 2020 @ 10:00
    What’s going to happend when companies start missing earnings estimates one by one
    • DJ
      D J.
      18 March 2020 @ 10:01
      I do realize that this is a stupid question but its worth thinking about in the coming months
  • RY
    Roy Y.
    18 March 2020 @ 09:59
    Thank you Ed and Roger ... For another great daily update ...
  • CD
    Cheryl D.
    18 March 2020 @ 00:38
    Could you please include in one of your videos why the 10 Year Note is rising. Is it simply volatility?
    • AW
      Andrew W.
      18 March 2020 @ 02:05
      unfounded fears from massive printing's effects
    • RH
      Roger H. | Real Vision
      18 March 2020 @ 06:06
      Here are a few thoughts on how this market has evolved and how some of the relationships have started to change: Stage one was risk off/repatriation: that saw bonds rally; JPY, EUR and CHF rally vs USD (but EM and commodity FX sell off); equities weaker. US equities generally outperformed during the sell off. This was largely the price action until the middle of last week. Stage two is VAR shock/funding issues: USD starting to rally vs JPY, EUR, CHF (EM and commodity FX still fall); bonds sell off, equities still under pressure (despite countercyclical rallies). US equities have underperformed this week (though much of this is giving back Friday's late squeeze). Central banks are trying to halt this stage by using exceptional policy measures. The weakness in bonds (higher yields) has generally been taking place on days when the dollar has rallied across the board. The bond weakness is not due to inflation expectations. Oil and copper have continued to fall. 10 Year inflation expectations have made new lows, meaning that US 10 Year real yields have soared from a -100bps low last week to +40bps yesterday (side note: gold performed remarkably well yesterday given this huge move higher in real yields) (nominal yields = inflation expectations plus real yield). Expectation of issuance is also driving some of the move – an expectation that a fiscal stimulus will lead to excess supply. Another unusual dynamic over the last 10 years has been that yields have risen once QE has been announced and commenced ($700bn of Treasury and Mortgage Backed QE was announced at the weekend). BUT this dynamic for QE leading to higher yields has usually occurred when QE was combating periods of soft growth, rather than an outright crisis. If QE is an attempt to dampen volatility, including bond volatility, it has so far failed this week, so I don’t think that this historical dynamic is the driver today. Overall I think the margin call/unwind impact is the major driver of bonds at the moment, plus convexity has been making the moves extreme in both directions (buying begets buying and vice versa). The funds that were buyers of bonds and equities on the way up are now mechanically forced to sell bonds.
    • DS
      David S.
      18 March 2020 @ 07:25
      Thanks Roger H. Good analysis. A lot of moving parts. DLS
  • KJ
    Kjell J.
    17 March 2020 @ 23:42
    Ed and Roger are fantastic. This is a great service. Please keep it going.
    • JM
      John M.
      18 March 2020 @ 06:45
      Yes, great stuff.
  • cz
    chris z.
    18 March 2020 @ 05:17
    So we're thinking this Friday may mark the bottom of equity prices?
    • RH
      Roger H. | Real Vision
      18 March 2020 @ 06:45
      Its worth being aware that it's quarterly expiry week (VIX March futures expire today and US/European index and equity options expire on Friday) which has probably helped accentuate some of the market moves in equities. We have seen many instances of reversals (in both directions) around these expiries (the quarterly expiries are March, June, September and December and tend to have much higher volumes/open interest than the other monthly expiries) BUT it's not a statistically relevant observation. I factor the expiry potential into the framework, rather than use it as a hard and fast rule.
  • BG
    Bob G.
    18 March 2020 @ 06:17
    Great job, guys, in a strange environment. Look forward to tomorrow...
  • DS
    David S.
    18 March 2020 @ 00:33
    When there is a massive debt crisis, it is difficult for governments to help their citizens without increasing debt massively. Many businesses are borrowed up to their eyeballs - not by CapEx but buying stock back at inflated P/Es. It is extremely difficult to act quickly and try to put the printed money where it will do the most good. In the US we are a government of the people, by the people and for the people. This means that people need be supported first in health services and daily needs during this pandemic. Businesses need to be helped also so we have an economy to support all of us when the virus passes. With most businesses going to the government to bail them out, it is time to realize again that they believe in a social net for business. Strict capitalism would not bail them out. Capitalism is the engine that drives prosperity in the US, especially small business. When businesses come to the government to bail them out as in 2008 and now, these businesses believe in socialism. In capitalism the businesses would have prepared for their ships not coming to harbor and keeping savings high for bad times - seven years of good harvests to cover for seven years of famine. This is not a political statement for either party. By their actions, both parties want to help people and businesses in this crisis. This is an attempt to look the word socialism in the eye and say that we believe in helping people and businesses in a crisis to the extent possible. Socialism cannot function without capitalism. Capitalism is the best economic system whereas socialism is a political system. They work together to make a great nation. The representatives of the people must define the level that the government can and should help citizens and businesses. DLS
    • WC
      Wilson C.
      18 March 2020 @ 05:42
      Amen David, well said. problem is most govt/administration lack the fortitude to "enforce" the other side of the equation when times are good, even here in HK, business leaders run unchecked until the next crisis.
  • JP
    J P.
    18 March 2020 @ 04:40
    Do you guys think the fed moves today sure up the hedge fund market makers liquidity issues?
  • tc
    thomas c.
    18 March 2020 @ 01:43
    A crisis is a time for change. 2008 nothing changed. Save the real economic actors but let the chips fall where they may for the financial casino. They structure the risk into the system. Suck up the consequences and finally put an ax to it and come up with something better.
    • km
      kenneth m.
      18 March 2020 @ 02:56
      Agreed! We say we are "capitalists" but the minute things go poorly, we demand bailouts. If we do not punish the bad actors - then we are sanctifying criminal behavior. To bailout airlines, banks, hedge funds, pseudo-banks, etc. who sold their companies (and our economy) down the river so their execs could get huge bonuses - without demanding REAL change and clawing back their ill-gotten gains - would be the biggest mistake we could possible make.
    • DS
      David S.
      18 March 2020 @ 04:13
      We do not need chaos. We need to have a functioning economy during and after the virus. We need to be smart. Any government loans to corporations need to be ahead of all other creditors. In 2008 all the banks wanted to pay off the loans ASAP and they did. The banks are solid now because rules were put in place. If the market had not forced the Fed to change course in interest rates, the market would have gone down anyway. The banks, however, would have some room to make money. Let's work together and try to be smart about it. DLS
  • AA
    Alberto A.
    18 March 2020 @ 02:36
    Great stuff guys! Keep these coming...and yes...after 6pm as there are many news happening during the day...thanks...
  • DS
    David S.
    18 March 2020 @ 00:34
    Great work! I look forward to the Daily Briefing with only two under my belt. DLS
  • JP
    Joseph P.
    17 March 2020 @ 23:53
    You two are killing it. Great stuff. Please keep it coming.
  • MH
    Martin H.
    17 March 2020 @ 23:23
    Love this. Thanks,
  • AV
    Alberto V.
    17 March 2020 @ 23:03
    I appreciate RV efforts but curve comparison of US total cases vs Italy (@1min) like mainstream news outlet present daily is pretty much worthless: it should be analyzed as % of population. Even better, because of the wide geographical dispersion of US residents, a good approach for US numbers could be the total number of cases for a basket of cities (or areas) down to a certain size of inhabitants (TBD and below which cases are no longer deemed representative for comparison purposes) as a % of the respective total number of inhabitants.
  • BT
    B T.
    17 March 2020 @ 23:00
    Hi, the Fed has announced in it press release on the 15th of march that it would remove all reserve requirement for banks and depositary institution on March 26. If I understand this correctly, it means banks can effectively create as much money / liquidity as they need. How do you see this impacting the liquidity issue we are facing and the results on the Dollar? Last Paragraph: https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm "In light of the shift to an ample reserves regime, the Board has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period. This action eliminates reserve requirements for thousands of depository institutions and will help to support lending to households and businesses."
  • PC
    Petros C.
    17 March 2020 @ 22:57
    I suggestion for the RV team: If you want your audience to learn why and how Covid-19 kills, why isolation matters, why China managed to control a new pandemic so fast and why herd immunity is concept out of a Nazi playbook, please interview Prof. Grigoris T. Gerotziafas. https://www.emedevents.com/speaker-profile/grigoris-t-gerotziafas https://www.linkedin.com/in/grigoris-gerotziafas-a171b136/
  • MB
    Matthew B.
    17 March 2020 @ 22:53
    Really excellent analysis. You just don't get this detail, complexity and insight anywhere else outside an actual institution. Also the format works much better when both participants are more relaxed and take their time. Last night was great but a but manic. Congratulations.
  • HR
    Humberto R.
    17 March 2020 @ 22:45
    Love this daily briefing feature of my membership level!
  • DM
    Dwayne M.
    17 March 2020 @ 22:33
    Excellent job Ed and Roger! You are providing great insight into what may be happening currently behind the scenes. As you move forward and the situation unfolds if you could provide some potential investment areas to look to profit from that would be very helpful.
  • JO
    JOHN O.
    17 March 2020 @ 22:29
    Excellent - as always!
  • CD
    Cheryl D.
    17 March 2020 @ 22:17
    Really excellent content!!! Thanks for explaining what's happening in the big picture!! Thanks Gentlemen!!!
  • HE
    Henry E.
    17 March 2020 @ 18:57
    Might be best to simply upload each day's briefing at precisely 6:00 p.m. ET with special editions coming as warranted.. just a thought..
    • MW
      Max W. | Real Vision
      17 March 2020 @ 20:06
      To avoid getting in to the mechanics of the website, the short answer is that putting this out with a dummy video allows us to get you the actual video the instant it is ready. The description above gives a full explanation.
    • HE
      Henry E.
      17 March 2020 @ 21:37
      Max W. Understood. My point, not clearly made, was to the placeholder out there (as you've done) and instead of saying: ....released that same day, with the goal of having the show out before 6:00 p.m. ET. - just hold it and release at 6:00 p.m. even if it's done earlier unless it's some kind of special edition. Really enjoy the Service.
  • HE
    Henry E.
    17 March 2020 @ 21:06
    As the video description says: This clip serves as a placeholder for the day’s video — so that the minute the actual episode is ready to air, we can swap the placeholder out and get the Daily Briefing to you as quickly as possible. There is no video YET...
  • LA
    Linda A.
    17 March 2020 @ 20:28
    Can't wait, I'll be back at 6. Thank u!!! One of my favorites - XOXO
  • TG
    Tom G.
    17 March 2020 @ 20:05
    It's just a placeholder for the briefing at 6pm ET
  • MW
    Max W. | Real Vision
    17 March 2020 @ 20:05
    To avoid getting in to the mechanics of the website, the short answer is that putting this out allows us to get you the actual video the instant it is ready. The description above gives a full explanation.
  • HC
    Hahns C.
    17 March 2020 @ 19:36
    "Cayman - **beep** we have a problem"
  • JB
    John B.
    17 March 2020 @ 19:35
    Markets so bad it is just a 60 second count down? ; )
  • CM
    Chris M.
    17 March 2020 @ 19:21
    no volume on this video
  • SJ
    Sean J.
    17 March 2020 @ 18:16