Revisiting The Only Thing That Matters In A Taper: Stock Vs. Flow Effects
With the ECB decision in the books, it’s worth briefly revisiting the QE “stock” versus “flow” debate. Although you can add specificity and fancy language if you like, it boils down to a very simple question: is it the cumulative size of central bank balance sheets that matters (the stock effect) or is it the […]
GBP/USD: Vulnerable, Sees Price Extension
GBP/USD: The pair weakened further during Friday trading session opening the door additional weakness. Support lies at the 1.3050 level where a break will turn attention to the 1.3000 level. Further down, support lies at the 1.2950 level. Below here will set the stage for more weakness towards the 1.2900 level. Conversely, resistance stands at […]
Morning Call For Friday, October 27
OVERNIGHT MARKETS AND NEWS Dec E-mini S&Ps (ESZ17 +0.21%) this morning are up +0.25% and European stocks are up +0.63% at a 2-year high. U.S. stock index futures rose after the U.S. House passed a resolution that brings tax cuts a step closer. Also, technology stocks gained with Alphabet up 3% in pre-market trading and Amazon.com […]
Tesla Downgraded To In Line On Model 3 Caution At Evercore ISI
As previously reported, Evercore ISI analyst George Galliers downgraded Tesla to In Line from Outperform citing a more cautious view on Model 3 production. While he said he remains positive on Tesla as a company, Galliers added that “clearly” Q3 production was weaker than Tesla expected and at this point, he has little insight […]
The ECB: Moving The Goalposts Or Real Tapering?
Is the “normalizing monetary policy musical chairs” trend now moving in the European Central Bank’s (ECB) direction? The Federal Reserve (Fed) started the process in December 2015 by beginning to remove its zero interest rate policy and followed the process to its next step, paring down its balance sheet starting in October. The Bank of Canada joined the rate-hike party in July, while […]
Weekend Reading: Markets Love Central Banks – No Matter What They Do
I discussed yesterday, the apparent “myth” of the Fed’s proposed “balance sheet reduction” program as the most recent analysis shows a $13.5 billion “reinvestment” into their balance sheet which has helped fuel the recent market advance. But therein lies the potential “fatal flaw” of the “bullish logic.” At the September FOMC meeting, the Federal Reserve announced their latest decision which contained two primary components: No […]
Why For Euro Bulls The Pain Is Only Just Starting
Judging by the 200 pip tumble since the ECB’s meeting on Thursday, the EUR/USD was at 1.1614 moments ago, the unexpectedly dovish taper clearly surprised many, and attention has fallen on the open-ended nature of the operation as the focus of that surprise. And speaking of said “open-ended” taper, overnight Boersen-Zeitung reported that Bundesbank President Jens […]
Tax Cuts Are Bullish For Oil
While the recent surge to 2-year highs on Brent Crude may slow because of a strong dollar. Yet, the expected march to a tax cut deal in the U.S. is bullish for oil. Tax cuts will equate to growth and that is music to oil bull ears. Demand that has already been surging around the […]
A “Marcus Trifecta” Look At Markets
Over the last few months, I’ve written about how we expect growth and inflation to pick up and surprise to the upside in the coming quarters. This belief is built on positive pressures we’re seeing within the economy as we move into the ‘overheat phase’ and the world benefits from the wealth S-curve tipping point. And with the […]
