Yesterday our 10% rolling stop got triggered on the long S&P oil & gas exploration & production (E&P)/short global gold miners pair trade. We are compelled to reinstate this intra-commodity pair trade, despite…
We previously wrote that the broad market would not stabilize until transportation stocks hit a floor. So far, the Dow Jones Transport Index seems to have done so on March 23, the same day as the broad market. Moreover, despite…
Highlights With interest rates near zero around the world, balance sheet policy will become an important driver for currencies. Should the global economy need another dose of monetary stimulus, yield curve control (YCC) and direct…
Highlights Extreme global economic uncertainty has pushed demand for USD higher, and forced investors to liquidate gold holdings to raise cash for margin calls and to provide precautionary balances. Gold endured a succession of down…
Highlights Recommended Allocation The outlook for markets over the next few months is highly uncertain. On the optimistic side, new COVID-19 cases are probably close to peaking (for now), and so equities could continue to…
Dear Client, I will be discussing the economic and financial implications of the pandemic with my colleague Caroline Miller this Friday, March 27 at 8:00 AM EDT (12:00 PM GMT, 1:00 PM CET, 8:00 PM HKT). I hope you will be able to join…
Highlights The pandemic has a negative impact on households and has not peaked in the US. But a depression is likely to be averted. Our market-based geopolitical risk indicators point toward a period of rising political turbulence…
Highlights The global economy is in the midst of a painful recession. Monetary and fiscal authorities are responding forcefully to the crisis, but the lengths of the lockouts and quarantines remain a major source of downside risk…
Gold’s weakness since March 9th was very concerning because it materialized as risk aversion and volatility spiked. Along with the weakness in the yen, it was the clearest symptom of the incapacity of the Fed to supply…
Investors and commentators have chalked up the fall in gold prices to margin calls. While this may have been true at first, fundamentals are now driving bullion prices lower. Our fair value model has turned lower as …