Comments
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BDI think the correlation of Libor-OIS with USD since 2016 should be approached with caution. USD Libor - OIS widened in 2016 peaking around September ahead of the implementation of US Money Market Reform on October 14th, 2016. Leading up to this date the US Money Market Funds didn't know what their investor balances would be as they moved from a Fixed to Floating NAV structure and had to impose liquidity gates and fees for the first time. Due to the uncertainty of how much would flow out of Prime funds into Govvy funds which didn't have to move to these same restrictions or USD bank accounts the Institutional Prime funds stopped or significantly reduced investiing in bank paper until they had a clearer view of what their fund balances would be so this Libor-OIS move was driven by a regulatory change. The drivers of the USD over this timeframe seem to be much more economic and political in nature so we should be wary of extrapolating this correlation.
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mdI watch most of what is on real vision, and follow a few other great sites. Over the last year I have learned a lot. What have I heard?? The market is going higher, much higher. The market is going down. The dollar is going up the dollar is going down. Oil is going to 180, oil is going to 20. Gold is going way up, gold is going nowhere. Bitcoin is where it is at, bitcoin is going to zero, etc. etc. Each of these views have been backed up with logic. The truth of the matter is that that these are all guesses, no one knows. What I do know is that regarding money, all that matters is money. In 1978 I purchased my first new chevy pick up truck for 3200.00 off the showroom floor. I could replace that truck today for around 50,000.00. Same applies to housing, education, health care etc. It is not the product or service but the dollar. This will not change because it cannot change. I must invest accordingly. Just my opinion.
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NHwho are the folks who did not like this video, as the content could not have been any clearer or direct. keep it coming.
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ggGotta say I sympathise with the two thumbs down. If you subscribed from day 1 you'd very likely to have made negative in equity. But lets brush over all that and re short oil at 66. Btw I have tremendous respect for these guys. But on the macro front, just not cut it well at all this year where others have (eg JDL).
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AMI really enjoy these conversations because it gives me some of the pieces I need to complete the jigsaw puzzle. Personally I don't find much value in actionable trade ideas because I think there are some very different time horizons and circumstances at work. It's more about taking the macro information being provided, comparing it to other quality analysis, and making one's own judgement based on what is appropriate for your own circumstance. Those who are expecting every trade idea to come through with a clean entry, exit, and stop price are deluding themselves.
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SCMy best guess is that the people voting thumbs down are probably in disagreement with the ideas and/or the results they personally have had over the last 12 months (at least in terms of oil short). Raoul has a longer time frame than most and some people don't get that. For me, I subscribed to Macro Insiders to get the idea of Raoul's and Julian's process and see how their thinking evolves as the markets do because frankly I don't know the fundamentals like they do and I focus on what I know: technicals. MI helps me develop a big picture framework that I can look to see if the charts agree. In terms of actionable trade ideas long term, I don't care about whether they're right or wrong, even in their own time frames. I'm using them to hear the USD strength argument, then I listen to Yusko and Rickards about the USD weakness argument and ask myself, "How can I position myself to make money with a margin of safety if either of these events occur?" With their help, as a 32yr old American, my solution so far is, no bonds (thinking range for US rates before rates go higher), put tight stops on my equities, hold some cash, hold gold/silver, hold miners for the long term, and put a tiny amount in the top 25 market cap crypto currencies as a low risk/high reward play. I have no idea which coins make it through or if any of them do but if the reward is 50x, why wouldn't I? This kind of thinking has helped me dramatically. I didn't have a plan for 2016 and sold out of most of my equities. That's my fault I didn't get back in and let my emotions control me. So with the help of Julian and Raoul, you can at least get an idea of what's possible and devise a plan to reduce risk. That's what I get out of this and I hope everyone can too. Our portfolios are our own responsibility and no one else's. Cheers everyone, and have a great weekend!
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bbcan you please somewhere on the site put a list of recommended trades, when recommended, price at recommendation, stop, and where it stands, like stopped out on this date, still pending etc...
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KAThanks for keeping us sober!
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DWInteresting, but not convincing from my perspective. I'll stay with J. Declerque, tactical long EURUSD here. The worst in Italy may be over for now, US real economy cannot take much higher rates and ECB might turn from fully dovish to less dovish. The main driver for EURUSD remain interest rate differentials and I just cannot see the FED ECB spread widen a lot more.
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SRGreat stuff guys! Really appreciate the idea of 'flash updates' as and when needed as not all of us have access to the same kinds of data you guys do, so I think we would all value these of kinds of update - especially as you say, events could happen extremely quickly. On US equities, I follow Peter Brandt and he is saying because the breadth of the US markets is still very broad based it's less likely markets are on the verge of a breakdown. This makes complete sense to me, and I (personally) think we may see markets move up much higher than anyone is expecting, possibly to new ATHs over the summer in a final blow-off type top? This would then play into your thinking where it's the end of Q3 and into Q4 where things start to get really interesting.
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LPGreat job guys. Interested in what potential trades (other than long dollar/short euro) the two of you would advise a US based retail investor to put on to capture a possible/probable Italian fiasco? Thanks!
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JGThanks for another insightful Insider Talks, Julian and Raoul. I think the dollar is the key partly because there is wide disagreement on its direction. Many think the rally is almost over while others like you think there is much more upside. There will be a lot of people on the wrong side of the trade which means the people who get this right are going to profit big time. The Italy bond market could be the spark for the dollar rally and the contagion declines in the equity markets. Very interesting times.
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SSLooks like the roof is leaking.