Blog Posts

At the end of August, the US 10-year Treasury bond was yielding 1.43 percent. It is now back up to nearly 2 percent. For those who missed the first rally, this gives another opportunity. At least to those who believe in some version of the narrative of a reasonably high probability of a recession within […]

All market watchers know the details by this point. Drone strikes on Saudi Arabia’s Abqaiq facilities sent crude oil prices flying 10 percent or more depending on the type of crude. Brent crude, shown above, is more susceptible to a Saudi outage than WTI. It was the largest daily gain in 28 years, back when […]

Experienced currencies traders know that government sponsored currency intervention is part of the game and can come out of the blue even when you may not expect it. Forex as a whole is a difficult asset class to trade with any degree of precision because there are so many factors that ultimately influence its behavior. It’s […]

In a recent article, we took a look at the issues confronting the Argentinian economy. For those who trade emerging market currencies (“EM FX”), it’s important to understand the fundamentals of what makes a currency move and idiosyncrasies governing these currencies. Unlike when you’re trading a G-7 currency pair, you don’t regularly have to worry […]

Argentina has been in the global markets headlines for over a year, with its tribulations with its economy and the volatility and severe depreciation in the Argentina peso. It is, once again, quite likely to default on its debt within the next few years unless it receives significant help from external sources (i.e., the IMF) […]

Negative bond yields don’t make sense at first glance. Why would anyone pay somebody to hold their money for them? Normally when you put up a lump sum of cash to invest, you expect a return stream out of that in the future. It doesn’t seem prudent to see that pile of money decrease in […]

Let’s start with a basic trading principle: When one country slaps tariffs on another country’s tariffs that is bullish for the tariff-implementing country and bearish for the country on the receiving end of them. It is an external shock that reduces national income for the recipient. The ongoing trade conflict between the US and China […]

US dollar liquidity refers to the amount of dollars available in the commercial banking system. The US Federal Reserve lends dollars to other central banks through swap lines, which the commercial banks in those other countries can use as a funding source. Many traders believe the US dollar will decline in the coming months. Speculative […]

Cryptocurrencies are a fledgling asset class that has produced, and is continuing to produce, mainstream speculative interest. Their widespread run-up in price throughout 2017 brought large-scale public attention. However, whether you’re a day trader, active swing trader, or buy-and-hold investor, trading is a business. In order to trade well, you have to know asset classes […]

Gold is a type of shadow currency with a valuation proportional to currency and financial asset reserves in circulation divided by global gold reserves. Put another way, it can be considered the sum of a weighted average of the yields of all global financial assets relative to their volumes divided by the global gold stock. […]