Discover and read the best of Twitter Threads about #eurodollar
Most recents (7)
I’ve been asked on here about the link between #Eurodollar creation and current (US) #inflation and the power of the #Fed to fight it. Since I get this question often, I thought I do a quick thread about it. (1/10)
In ch. 2 of “Offshore Finance and State Power” I explain how banks outside the US can create US$ by issuing debt. These #Eurodollar look like US$, but are different b/c a different legal code is attached to them (mostly English law) tinyurl.com/yhefwrxh (2/10)
The obvious follow up questions are: 1) Can these #Eurodollar cycle back into the US economy? 2) Can they create #inflation there? 3) Given they are created outside the US, does the #Fed have the power to fight inflation? (3/10)
I was asked about why there are differences in #TEDSPREAD values/plotting, so here’s what you should know. The acronym “TED” is derived from #TREASURIES minus #EURODOLLARS & expresses the difference between theoretically risk free yield & yield with embedded credit risk (cont)…
…classically TED spreads are plotted using same term cash #TREASURY bills against #LIBOR yields. Most often the terms used are 1M & 3M month tenors, though overnight tenors can also be used. Of course any risk free rate can be used such as #SOFR, as in my previous post (cont)…
If you’re wanting to trade #TED spreads using futures and/or you don’t have access to an #EIKON or Bloomberg terminal for cash plots you can construct/trade a viable version of them synthetically using 2Y #TREASURY & #EURODOLLAR futures which is very common (cont)… $ZT $ED $GE
Did someone warn you of the current #inflation, #recession, and #bearmarket in equities? Did you get out or reallocate in time? Breaking even? Maybe even profit?
Did you pay a subscription for those warnings late last year?
I started warning friends about it in 2016.
Read on🧵
Did you pay a subscription for those warnings late last year?
I started warning friends about it in 2016.
Read on🧵
When I said that I was warning my friends about it in 2016, I did so because it was clear that #Trump would not be a good president for the US & world #economy long-term, and would increase the odds of #inflation and rising #interestrates.
Late 2016 DMs in Norwegian to a friend:
Late 2016 DMs in Norwegian to a friend:
1/ @NYtimes story on #crypto/#banking deserves a thoughtful reply. Issue isn't black & white: anti-crypto forces try to paint us all w/ a broad brush. Bad actors deserve to be called out, but the article ignores fact that regulatory-compliant firms exist. nytimes.com/2021/09/05/us/…
2/ First--@ericliptonnyt/@el72champs you got a fact wrong & it deserves a correction. #Wyoming’s special bank charter doesn't allow “cryptocurrency deposits.” “Deposit” has a v specific meaning in banking: banks can only take deposits in fiat money (US$)--not in crypto. Pls fix.
3/ That’s a key distinction. Regulated banks can provide CUSTODY services for #crypto (like for securities) but CAN’T take deposits in ANYTHING except money. Article misses that critical point--it’s a firewall protecting Fed's payment system from exposure to anything other than $
1/ THREAD ABT REGULATORY NEWS in #crypto, which I’ve been chronicling on twitter since April. Seems crackdown has begun. I dunno how it'll turn out but:
* it won't impact #BTC #ETH etc directly. Base layers will keep addin' blocks
* it'll impact intermediaries & US$ access points
* it won't impact #BTC #ETH etc directly. Base layers will keep addin' blocks
* it'll impact intermediaries & US$ access points
2/ Today was a key event that few in #crypto were probably watching, but it REALLY matters: the comment period ended for the Fed’s proposed payment system access guidelines. See comment letters here (including @AvantiBT’s 18-page tome--awaiting upload): federalreserve.gov/apps/foia/View…
3/ Why does it matter? Fed guidelines are partly aimed at #crypto (despite not mentioning crypto even once). Given what’s happening w/ US$ #stablecoins, the guidelines are esp relevant (see WSJ story last wk-FSOC wants Fed to regulate stablecoins per “ppl familiar w/discussion”)
#FED 18 Mart'ta ne yapacak? Piyasanın algısını; FED faizine bahis oynanan vadeli piyasa, nam-ı değer Fed Funds Futures veya sokak diliyle: #Eurodollar kontratları gösteriyor. Her toplantı (FOMC) gününün bugünkü beklentisine nereden bakabiliriz? Şuradan:
cmegroup.com/trading/intere…
cmegroup.com/trading/intere…
Ana sayfada toplantı günü seçerek durumu görmek mümkün. Panelin solundan "probabilities" seçersek, her toplantı için genel olasılık dağılımı da verilmekte:
Yılın son toplantısında, faizin sıfıra indirilebileceği dahi olasılıklara girmiş 🤨 FED suyundan da koyar mı bilmiyoruz ama en azından düne kıyasla ihtimali biraz düşmüş.
Rabobank 1/4: Expectations that the Federal Reserve is on the brink of cutting interest rates combined with forecasts that the Fed funds rate could be significantly lower by the end of the last year have unsurprisingly knocked the USD in recent weeks.
Rabobank 2/4: That said, the outlook for the greenback is complicated by a number of other factors. Firstly other major central banks are also pursuing accommodative policy settings. This should dilute the impact of lower Fed rates on the USD.
Rabobank 3/4: Additionally, slowing world growth and geopolitical risks are likely to stymie appetite for risky emerging market assets. As long as confidence in EM is shaky, there is good reason to expect the USD to find solid support.
