Gentlemen and ladies,
\nBeing the first Saturday of June 2023, I’d like to hear from the Tent what is the “vibe” for this month, which will also mark the end of 2Q 2023.<\/p>\n
With the debt ceiling now effectively raised, I’m trying to understand how the flooding of treasuries will impact very short term rates\/2 year rates\/10-30 year rates?
\nIf rates rise, will markets sell off hard?
\nHaving gone up north of 10% in the last 12 weeks, S&P could just “correct” by 4-6% and yet remain “bullish” in the medium term?
\nFrom this point on I think it is more about ratios now, more than ever.<\/p>\n
Today gold to S&P ratio is roughly under 0.46.<\/p>\n
My educated guesses:
\n(i) Whether rates rise or fall, PMs rise.
\n(ii) If rates rise fast, due to higher treasury issuance, PMs rise faster, S&P could sell off, and the ratio rises, toward 0.48, or towards the magical 0.5 number. Many analysts are waiting for this confirmation.
\n(iii) No matter how much fiduciaries advise, to stop believing in TINA, I still see TINA is alive. NVDA, GOOG, AAPL all being at 52-wk highs is a simple proof.<\/p>\n
JPMorgan Chase & Co. strategist Nikolaos Panigirtzoglou estimates a flood of Treasuries will compound the effect of QT on stocks and bonds, knocking almost 5% off their combined performance this year. Citigroup Inc. macro strategists offer a similar calculus, showing a median drop of 5.4% in the S&P 500 over two months could follow a liquidity drawdown of such magnitude, and a 37 basis-point jolt for high-yield credit spreads.<\/em><\/p>\n https:\/\/finance.yahoo.com\/news\/trillion-dollar-treasury-vacuum-coming-135944792.html<\/p>\n GL<\/p>\n","protected":false},"excerpt":{"rendered":" Gentlemen and ladies, Being the first Saturday of June 2023, I’d like to hear from the Tent what is the “vibe” for this month, which will also mark the end of 2Q 2023. With the debt ceiling now effectively raised, … Continue reading