MAD Macro - The Big Boy Match
The Tin Man vs The Orange Mad King I
The Golf Match Is a Better Idea than Another Debate
The Next Mad Macro Will Be Thursday 7/18
Ok, the Orange Mad King I challenged the Tin Man to another debate. The Orange Mad King I was desperate to get back in the news so he challenged the Tin Man to a debate or a televised golf match. Nancy Pelosi, Chuck Schumer and Hakeem Jefferies think the golf match is a better choice than another debate. But first, the Tin Man needs to survive his “Big Boy” press conference today. Karine Jean-Pierre, also known as Binder Lady, has labeled the Tin Man’s press conference a “Big Boy” press conference. I am starting to think the Tin Man’s “team” is trying to get rid of him. Think about it for a moment. Why did the Binder Lady say Big Boy? Did it say Big Boy in the binder? Was it a mistake or maybe it was a cheap fake? Does she think he is a big boy or a little boy? I am hoping for the golf match. I am taking the Tin Man in this match for several reasons. First, you don’t need to talk when you are playing golf. Second, the Orange Mad King I always takes a cart, so no walking required. Third, if it’s televised the Orange Mad King I can’t cheat. Last and most importantly, the Orange Mad King I is giving the Tin Man 20 strokes. We all know the Orange Mad King I has a big ego and exaggerates everything, especially how good his golf game is. I am sure the Orange Mad King I has a better golf game than the Tin Man. I am also sure the Tin Man never had a 6 handicap. But with 20 strokes the Tin Man should crush the Orange Mad King I. By the way, if I am wrong and the Tin Man loses the Big Boy match with 20 strokes, he needs to resign immediately.
The NYT played Brutus and plunged the first sword into the Tin Man. It’s appropriate that it was an actor who thrust the final sword into the Tin Man’s back. George Clooney’s opinion article is linked here. Today the NYT turned their sights on the Orange Mad King I. The editorial board launched a nuclear missile aimed directly at the Orange Mad King I. The article is linked here. It has a simple and direct title, “Donald Trump Is Unfit to Lead”. It’s a very effective attack, but they forgot to mention that the Orange Mad King I does not respect the rules of golf. In case you are wondering who is on the NYT editorial board, they don’t say, but they do give a helpful description. “The editorial board is a group of opinion journalists whose views are informed by expertise, research, debate and certain longstanding values. It is separate from the newsroom”. The word values is underlined. Nice! In case you were wondering, now you know where the NYT stands. I wonder, is Hillary on the NYT editorial board? We know Hillary has values unlike the Deplorables.
I guess markets love political conflict. The market is melting up this week. Fortunately, we have the WSJ. They are still writing about the economy and I don’t think they have TDS. Maybe Nick Timiraos has the answer to the market melt-up. He has an article today, linked here. It’s titled, “What’s Behind Powell’s Latest Shift on Rates”. Nick is the official Fed whisperer. “Federal Reserve Chair Jerome Powell made the beginning of a pivot on interest rates that might prove more durable.” I wonder, did Jay tell Nick that he prefers the formal Jerome over Jay? Anyway, a Fed pivot would help explain this week’s market melt-up. We get the all-important CPI inflation report this morning. It’s expected to be 3.1% year-over-year, down from 3.3% last month. If it’s a good report, as expected, maybe that will confirm Jerome’s pivot. Then does George Costanza sell the good news?
I updated the U.S. Dollar Index, U.S. 10yr yield, U.S. 10yr-2yr yield spread, WTI crude oil, NY copper, spot gold, bitcoin, S&P futures, NASDAQ 100 futures and NASDAQ 100 Index weekly charts below.
The dollar is a little lower and looks like it might break down below it’s wedge formation on the chart. 10yr yields are unchanged. I think it’s possible that the curve might steepen on a Fed pivot. We might see 10yr yields rise a little at the same time 2yr yields fall on good inflation news and a confirmed Fed pivot.
Crude oil and gold are higher. Copper is a little lower. Bitcoin is a little higher and is testing the 200 day resistance level.
Both the S&P and NASDAQ 100 futures are a little lower after yesterday’s melt-up. I included the longer-term weekly chart of the NASDAQ 100 index again today. I think it might correct from this upper channel line shown on the chart.
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S&P 500 futures are a type of derivative contract that provides a buyer with an investment priced based on the expectation of the S&P 500 Index’s future value. Nasdaq 100 futures are commodities futures products traded within the equity futures sector. West Texas Intermediate (WTI) oil is a benchmark used by oil markets, representing oil produced in the U.S. Brent Crude Oil is a blend of crude oil recovered from the North Sea in the early 1960s, whose price is used as a benchmark for the commodity's prices. The U.S. dollar index (USDX) is a measure of the value of the U.S. dollar relative to the value of a basket of currencies of the majority of the U.S.'s most significant trading partners. UBS Bloomberg Constant Maturity Commodity Index is a total return rules-based composite benchmark index diversified across commodity components from within specific sectors.
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