iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
18,723 Blog Posts

Things You Should Be Watching Now to Assess Risk

I’m never sure if corrections are real or not, while enduring them in real time. Ten out of ten times, they feel like the end of the world. It’s only with the benefit of hindsight that we find out how stupid or smart we were. Luckily for me, I have an archive on iBankCoin. You can dig into my records and bear witness to 100% gains in 2008, 60% gains in 2009 — and an overall market acumen very few have ever been able to communicate to others on a wide and transparent scale.

This is what I’m watching now to assess the risk, to determine if this is a real credit worthy event that will imperil the entire capital structure of the market, or a passing storm. After stocks go down, next is credit. When corporate bonds diverge from sovereign, there is an issue there. When FX markets get disrupted, pay attention — because there is no bigger markets in the world.

We haven’t heard about the Yen carry trade in some time. Should FXY continue to trend higher while corporate bonds and stocks low, you will hear about it all day long, damn it.

High yield bonds are getting killed. Unremarkable, aside from the fact that investment grade bonds are getting killed too, while TLT is going up.

The ultimate currency haven — Swiss Francs. The ECB chimps out when this happens. Watch it.

That’s all for now. Try not to stress out ahead of National Festival Day. Get small and stay that way until morale improves.

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19 comments

  1. probucks

    HYG is a broken ETF.

    It only loosely tracks the assets and if there was a liquidity event in junk credit spreads, the ETF would surely go the route of XIV and ShortSellers.com with spectacular speed.

    The underlying asses are basically illiquid and valuations are a coin-flip.

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  2. it is showtime

    If the society wants to kick the can, AGAIN
    And backlog the displacements, A little more
    Go ahead. You will still get slammed in time.

    By the greater and augmented magnitude

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  3. ferd

    I agree with your post as to things worth watching now. But a historically-correlated but safer bet right here than your long treasuries, is to be short the dollar. Because if this is when it does finally hit the fan, both the dollar and treasuries will go down.

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  4. acehood

    What movie is that from

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  5. chuck bennett

    Macy’s , Home F ing depot, Target bitches. Even those crooks at Nordstrom’s.

    Get some.

    Regards

    Chuck Bennett

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  6. one-eighty

    Perhaps the market is finally realizing that nothing that comes out of President Space Case’s mouth has any relation to realty.

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    • one-eighty

      Oops…”reality”

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    • lamouche

      He warned you October 30 ” If you want your Stocks to go down, I strongly suggest voting Democrat. They like the Venezuela financial model, High Taxes & Open Borders!”

      Your insistence on living in an non-existent alternate reality is what has you troubled.

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  7. whaler31

    The Fly is on the mark here. This is a strange time in the long-term scheme of things. It feels real, but could be fake.

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  8. Lyndon Keltner

    /ES sub-2680 is very buyable until 8 or 9AM.

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    • Lyndon Keltner

      Scalp results: equal-size long entries at 79, 69, 59, 49, 39; flat at 69 for +10 points/+40 ticks.

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  9. roundwego

    Yesterday was the slip. Today we should get the slide down. Watch vix, it may blast off.

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  10. scrillions

    Adding to my seed bank.

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