Global Macro Trading Journal

Daal said:
"And the pandemic has led to a burst of innovative government. Those which can afford it—and some, like Brazil’s, that cannot (see article)—have suppressed inequality by spending over $10trn on covid-19, three times more in real terms than in the financial crisis. That will dramatically reset citizens’ expectations about what governments can do for them."

This ties back to the Milton Friedman article I posted last week. The role of government in society has now increased, in a way that will be extremely difficult to roll back. Universal Basic Income is likely to be a significant part of the discussion in the future. Central bank digital currencies (or even just stablecoins issued by regulated companies) will make UBI very easy. It will also enable negative interest rates

With regards to negative rates, I'm currently reading the Rogoff book "The Curse of Cash" that talks about banning cash and all its benefits. When I finish I plan to write more about it but I find it more and more likely its going to become a reality

Ultimately what this all likely means are higher structural deficits, more debt and more money priting
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Banning cash is some ways off in the USA - at least a decade and likely more IMO. Many US cities have actually banned cashless businesses on the grounds that it discriminates against blacks and latinos, which these days is enough to kill any law or proposal.

I think before that can happen we need to see a migration to centralized banking, wherein all individual accounts are held at the Fed and no longer by commercial banks - banks and fintechs sell customer-facing interfaces/overlays while deposit funding is replaced by Fed funding at the FFR. That transition will probably take place after the next big crisis, sometime in the late 2020s.

It's a bad time to be a saver, the days of making significant real returns on passive investments are coming to an end.
 
Specterx said:
Banning cash is some ways off in the USA - at least a decade and likely more IMO. Many US cities have actually banned cashless businesses on the grounds that it discriminates against blacks and latinos, which these days is enough to kill any law or proposal.

I think before that can happen we need to see a migration to centralized banking, wherein all individual accounts are held at the Fed and no longer by commercial banks - banks and fintechs sell customer-facing interfaces/overlays while deposit funding is replaced by Fed funding at the FFR. That transition will probably take place after the next big crisis, sometime in the late 2020s.

It's a bad time to be a saver, the days of making significant real returns on passive investments are coming to an end.
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I would suggest you pick up Rogoff's book. His argument is actually more nuanced that it looks like. He is in favor of banning the $100 and $50 bills, not cash entirely. He just wants to make it hard to hoard cash, primarely due law enforcement reasons. These latinos or blacks could use $20 or lower bills. He is also in favor of coins of higher denominations (not sure how high though).
I don't know when all of this will happen but I'd note that his book came out in 2015 and he talked a lot of shit about the €500 note, and the EU removed that note the year after it. I suspect this idea will be accelerated by the Pandemic, like most digital trends (Zoom, BTC, etc). With Mnuchin wanting to know about $3000 crypto transfers with law enforcement as an excuse, I dont think its that crazy for the next UST to ban the $100 bill using similar arguments. The Fed is close to Yellen, if they say they need less cash in order to implement negative rates at some point, I bet she would be open to it. I dont know when this happens but I wouldnt dismiss it as a 10y+ story
 
I plan to buy some SPY puts at open in case this UK virus mutation is worse than it looks. I already buy them every 2-3 months as part of my portfolio hedging regimen. But I want to make sure I have a little extra just in case
Probably it wont work as fiscal and monetary stimulus will be increased even more but who knows, if the mutation renders the vaccine useless, it should cause a panic sell-off
https://www.economist.com/science-a...s-variant-may-derail-pandemic-control-efforts
 
So I opened a Tradestation account for my entity, as a backup against problems at IB. I'm finding it a pretty decent broker. They have one thing I really like, which is a crypto platform, integrated with the securities account. That is, I can buy crypto using money that is in the stock account. This completes the link between old financial investments and new ones for me. Previously I had to make wires, deal with annoyning banks, forms, KYCs, etc. Now I can move money easily between IB and TS, buy and sell crypto and moving gains from crypto back to stocks or vice-versa.

Their crypto platform is pretty interesting because its not an exchange model, they aggregate multiple feeds from multiple sources (exchanges, OTC desks, etc) into one place. This results in a tighter bid ask spread and more liquidity. I even saw the BTC bid and ask cross sometimes. They do have a hefty trading fee of 0.50% for accounts up to $100K, but that can be lowered by increasing the deposit. Plus the tighter spread and better liquidity compensates for that. Especially for big orders.
Its an institutional type crypto product offered to retail clients. They also pay a little interest on crypto holdings, not that its worth it, probably isn't but at least they give you something, which most exchanges don't.
I sold a short-term position I had in GBTC and converted into TS BTC. This premium got to be arbed down to 10% at some point
 
Just locked 1/3 of my BTC with CheckTimeLockVerify on the BTC blockchain. I can only get it out from Mid 2023 to 2026 (it will be released in parts every 6 months), I used these days because 2024 is the next halving date. Now I can focus on the 2/3, trying to catch this cycle top, which is probably much higher than here
I also plan to do that with my Ether, which I think might be a little more complicated as I might have to write the program myself with Solidity and deploy my own smart contract
 
Cashless or minimal cash societies are what will happen. I'm not trying to regurgitate points made already, but it benefits governments immensely with it being bad for the average person and will get the support of the poorer classes as government support goes digital.

Empirical data point: those CBDCs are not an experiment/lab project. FWIW, they are been headhunting in this space very aggressively for those with the right skills. From my conversations, CBDCs are much further towards completion than many would think. The main hurdle is legal/regulatory and pushback from the public.
 
So the way to go to lock Ethereum is to stake it for ETH 2.0. There are a lot of sites that offer this service but only a few give you the withdraw keys, so you dont take company risk. I plan to do that early next year once the holidays are over
https://beaconcha.in/stakingServices

This will also generate 5% to 20% a year
 
tsznecki said:
LOL @Daal I think you did a complete 180 with regards to staking in about a week.
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no, its one thing to stake with a COMPANY where you hold the credit/hacking risk of the company and another to stake in a proof of stake system, where you hold the withdraw keys and carry no company risk. they run just a node for you, which i could do myself and might
 
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