Monday 13 March 2017

Fancy a fifty year bond?

US equity indexes closed moderately mixed, sp +1pt at 2373. The two leaders - Trans/R2K, settled -0.4% and +0.4% respectively. VIX settled -2.7% at 11.35. Near term outlook offers moderate chop across Tuesday and into the FOMC announcement of Wed' @ 2pm. Broadly, the market looks strong to the 2500s, seemingly viable as early as late April.




There is little to add, as the week began on a very subdued note, with the sp' seeing a trading range of just 6pts. The VIX itself was naturally very subdued, melting a little lower to the low 11s.

Next gen US bonds

On clown finance TV today they were once again raising the issue that the US Treasury might eventually start issuing 50yr bonds.

Santelli.. still has a place on CNBC

I have long believed that were Trump to become President, that we'd eventually see 'infrastructure bonds'. Such bonds would be hyper-long term, on the order of half a century. For a duration that far out, we have to be looking at 50-100bps above the current 10yr yield of 2.6%. Its arguably just a case of whether this happens before the next recession... or during. Certainly... by 2019/20.

Some drama in after hours as Ackman has capitulated...

So Ackman has sold for around a 90% loss (approx $200 million), and managed to commit just about every trading mistake possible within his monstrous VRX-long. Do some of the super-pros not use stops when trading other people's money? Isn't that beyond insane? The fact he is now coming out with a 'I should have sold earlier' comment... that is just incredible. If you were a Pershing Square investor... what would you say to that?

Goodnight from London