The Heisenberg Report | TalkMarkets | Page 86
Contributor's Links: The Heisenberg Report
Perhaps more than any other time in the last six decades, the fate of markets is inextricably intertwined with the ebb and flow of geopolitics. From the ECB's attempts to use the central bank's balance sheet to influence political outcomes across the eurozone to Saudi Arabia's efforts ...more

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Just Another Junk Bond Chart To Ignore On A Slow Wednesday…
There’s always junk bonds to talk about and we’ve been saving up one fun chart for just such a time as this.
Chart Of The Day: The ECB Is Running Out Of Excuses
With rate differentials narrowing thanks in part to falling Treasury yields, you probably don’t want to go too far with the hawkishness if you’re the ECB unless you want to end up giving folks more reasons to be long EUR/USD.
Trader: You’re “An Emotional Train Wreck” – But Buying-The-Dip Might Help
The former FX trader turned Bloomberg contributor says one of the main big-picture questions you need to answer yourself is whether and to what extent the central bank put will remain in place.
Buy-The-Dip In Danger From "Politicians Who Want To Change The Liberal Order"
If yields and the dollar were any indication, Monday probably should have turned into the bloodbath it looked like it would be at the open. But it didn’t.
BofAML: Health Care Failure “Best Thing To Happen To Trump Trades Since Inauguration”
So there are two things you can do when bad things happen or when the narrative you’ve been clinging to in order to justify your positions falls apart.
Here We Go, USD/JPY Eyes Lows
The barometer for how the market feels about the US reflation narrative is flashing red all of the sudden (or “green” depending on what side of the trade you happen to be on).
“The Sky Is Falling”: When Stocks Go Down, Everyone Panics
No longer are market participants looking to get the jump on their peers. Instead, everyone is waiting on someone else to set the narrative.
Here’s The One Strategy That May Work When “There’s Plenty To Be Bearish About”
Markets have lost the narrative. And traders will be forgiven, because let’s face it: the narrative died on Friday after suffering a stroke last Tuesday.
Goldman: OPEC Should Not Extend Production Cuts
Wall Street is pretty wedded to the bullish oil thesis and to the general idea that this market is going to balance, record US production or no record US production.
It’s Falling Apart: Reflation Trade Shrivels Up And Dies As Markets Sour On Risk
The Bloomberg Dollar Spot Index fell as traders digested the failure of the GOP healthcare bill on Friday. This is the index’s eighth drop in the last nine days.
“They Can’t Afford Another Humiliating Defeat” – Fund Managers, Analysts Weigh In On The Road Ahead
The entire reflation narrative (in the US) hinged on tax reform and fiscal stimulus. The problem: tax reform and fiscal stimulus hinged on ACA repeal. Now if “repeal and replace” is dead, traders want to know if the reflation narrative died with it.
10Y Treasury Shorts “Aggressively” Cut After Fed Hike, But…
Although specs have trimmed 10Y Treasury shorts over the last two weeks (they cut around $7.4m/DV01 in the week ended Tuesday, the second straight week of pared bearish bets), eurodollar shorts are still sitting at a record.
“Hope”: Health Bill Failure Isn’t Death Knell For Trump Trade, One Bank Says
Earlier this month, everyone was still long the broad market in an apparent effort to fade the Trump trade via the Russell 2000 while simultaneously staying long the very same Trump trade via the S&P.
“Is There A Problem We’re Not Seeing?” – China’s Banking System Reaches “Tipping Point”
Markets have short memories. This time last year, China was still at the top of every trader’s list of things to be concerned about. And understandably so.
Guess What? The Market Stopped Believing In Tax Reform A Long Time Ago
The boost to S&P 500 earnings from a lower corporate tax rate is likely to be smaller and to occur later than investors originally expected.
Chart Check: “This Should Be Fine”
Earnings growth in the last 10 years was poor. Global earnings have followed a similar pattern.
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