Global Macro Trading Journal

I like Gundlach idea of buying volatility right now
http://www.zerohedge.com/news/2017-06-13/gundlah-you-should-be-raising-cash-literally-today

My tests are showing that systematic put buying hurts risk adjusted performance but perhaps tactical put buying is the way to go. Waiting for extremes like right now perhaps can boost results. this will also protect me against problems in the trump agenda, the investigations, geopolitics, etc. So I plan to ramp up my tal hedging put buying
 
My short in the front end is not working well so far (with losses partially offset by 30y bonds, gold and gold stocks). But I just can't think that closing at these prices make any sense. At this point, if the Fed hikes 1 more time (after today), the short breaks even. So the market thinks the Fed guidance is off by several hikes, which I believe its way too dovish. Especially given that this econ data misses could easily just be randomness, NFP is still above the range needed to keep the unemployment rate flat (so the current path will bring it down). Even in the inflation side things are not looking as bad as zerohedge thinks

upload_2017-6-14_12-18-21.png


The Median CPI and 16% trimmed-mean are still in a 'hike away' zone (Yellen looks as them as she mentioned in a press conference in the past), these 2 remove volatile elements from the CPI figures, so they give info on the 'trend'.
But some disinflation has hit the economy in the last few months. The question is, is there any reason to expect that to continue? Whats the driver? Inflation has been in a range of 1.5%-2% since 2012, why would all of the sudden go into disinflation mode and break down? If anything, now with the weak USD and the potential for tax cuts (which will be stimulative), I'd expect it to hold up and the Fed to put at least 2 hikes till 2019 after today.
Most likely, this is just all noise, in all likelyhood inflation remains in a 1.5%-2% range, NFP continues to print 100-150K and GDP avgs 1.5-2.5% going forward. This setup will require a hike here and there. But the bond market seems to disagree, maybe they think that the US will go in the way of Japan. I think that's wrong but we will see. I'm certaintly not adding here, until the data firms up some
 
The core CPI, the 16% trimmed mean CPI (which removes the 8% highest inflation items and the 8% lowest) and the median CPI (just a median of all items) are all 'trend inflation' indicators. If you give an equal weighting to each, then 2/3 held up resonably well in May. The median CPI actually increased at a 2.2% annualized rate, so this looks like a mixed bag to me. We will see what the core PCE looks like, if that comes out soft. But still, it looks pretty likely this is all just noise and US inflation will do what usually does, that is, remain anchored at a range of 1.5%-2%. I don't think there is much of a reason to expect Japan to hit the US all of the sudden, certaintly not at this point of the economic cycle
 
Some of the consequences of Trump's poor/violent communication might be events like today's attack at the Baseball game. I worry about a bigger, larger attack from people that are pissed at him as well as I believe there is a fair amount of chance there will be an assasination attempt against him at some point
 
Bought some lotto GE (eurodollar futures) 98.00 dec 2018 puts. Fed is not giving a shit about inflation, if the market is wrong here, these lotto puts can payoff if there are tax cuts and other things
 
I dont like TetherUSD so I came up with a way to trade in many exchanges while being protected against a BTC collapse. I short the BTCUSD pair on Kraken, buy BTC for the same amount and then transfer those BTCs to the other exchanges. Polio seems to be the best around, very liquid compared to Kraken which sometimes leave a lot of be desired
 
I was looking at shorting Dec 2108 or 2019 Fed Funds. Unless we get a recession(possible but unlikely <2 yrs), it's a decent R:R.

Anyways, you are aware @Daal that Kraken has a carry fee on BTC yes?
 
jj90 said:
I was looking at shorting Dec 2108 or 2019 Fed Funds. Unless we get a recession(possible but unlikely <2 yrs), it's a decent R:R.

Anyways, you are aware @Daal that Kraken has a carry fee on BTC yes?
More...
I suspected they had, how much is the carry, do you know?
 
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