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Thoughts From The Divide: If Then

With another “most important Fed meeting of our lifetime” squarely in the rearview, and the first round of knee-jerk market moves pass to the side mirrors, it’s worth reflecting a little on the Fed Chair Powell’s “works”. The “biggest” move was the announced tapering of treasuries QT to roughly $25b from the previous rate of $60b of run off a month, but beyond that Fed confidence was conspicuous by its absence. The Chairman stated as much, admitting that “the data have not given us that greater confidence” that inflation was moving toward the 2% goal that Powell indicated necessary (how long is a piece of string?) for cuts. Read more →

Thoughts From the Divide:  Subjest to Change

As the saying goes, “needs must when the devil drives”. We have no problem understanding the Fed’s decision to announce (at 7pm last night) that the details of the BTFP program needed to be altered. The problem was the overly juicy arbitrage, whereby banks could use the BTFP window to flip cash from the Fed into the RRP and pocket the not-insubstantial difference. We were impressed by the chutzpah involved in arbitraging two Fed facilities! Read more →

C8 Weekly Bulletin: Are Fed rate hike expectations realistic?

This week's Bulletin is being guest edited by one of our newest index providers, IVI Capital, a global macro hedge fund.  Their index is a daily, futures-only strategy.  C8 Studio shows the index up 23.5% so far this year.  Read more →
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