Discover and read the best of Twitter Threads about #macro

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🐻♉️↗️↘️↔️⚠️🚩🔺🔻🧮 💰

Macro Review 🧵


Don’t you find it amazing how quickly the phrases “Transitory Goldilocks” and “Immaculate Disinflation” have entered the #macro vocabulary?

Where did they come from? Why?

Let’s start with “Immaculate Disinflation”

Core #PCE rose .72% in Q4 2022 or +2.88% annualized.

The Fed has to be pleased with this, but given the pace of rate hikes, this is not all that surprising

Chart: Core #PCE

Wages have also started to decelerated quickly - now +4.6% y/y

Chart: US average hourly earnings y/y
Read 20 tweets
A thread 🧵 on P/E ratio Image
P/E ratio is a financial metric that compares a company's stock price to its earnings per share. It's used to evaluate the relative value of a stock and assess its potential for growth.
A P/E ratio of 15, for example, means that the stock's price is 15 times its earnings per share. A higher P/E ratio indicates that investors are paying more for each rupee of earnings.
Read 15 tweets
China in 5 charts (1/5)

What drives overall China equities?

When China Internet $KWEB outperforms MSCI China (grey line), its often positive for China equities $MCHI (orange line).

#China Image
China in 5 charts (2/5)

How does China equities perform when USD weakens?

When USD weakens, China equities strengthens.

Inverted $DXY in grey and $MCHI in orange here.

#China #macro Image
China in 5 charts (3/5)

Is China or US equities better in a weakening USD environment?

When USD is weak, China equities $MCHI tends to outperform US equities.

Inverted $DXY in grey and $MCHI over $SPY in orange here.

#China #macro Image
Read 5 tweets
Wondering about latest news 📰 in the #realestate #housingmarket 🏡💵 with pricing, #interestrates, etc.? Here's an updated thread for January 23' that includes all the latest macro/market data... 🧵/👇🏼

📊h/t @RealEstateCafe
1/🧵 "44% year/year drop in ⁦@MBAMortgage
⁩ Purchase Index is largest decline on record." 🇺🇸📉

📊h/t @LizAnnSonders @bloomberg

#realestate #realestateinvesting #FederalReserve #interestrates #macro #realator #mortgagerates
2/🧵 Affordability "threshold" for housing, via the @AtlantaFed 🏡

📊h/t @NewsLambert

#realestate #realestateinvesting #FederalReserve #interestrates #macro #realator #mortgagerates
Read 26 tweets
@PwC @PwCUS just released their 2023 Annual Global CEO Survey — here's a thread of the top takeaways from the survey, including the fact that "40% of CEO's don't think their companies will be 'economically viable' in the next 10yrs"... 🧵/👇🏼

#macro #Stockmarket #DataAnalytics
1/🧵 "Roughly 40% flagged the transition to new energy sources and supply chain disruption." @PwC @PwCUS

#macro #Stockmarket #DataAnalytics #commodities #supplychainmanagement #tech
2/🧵 "#inflation and #macroeconomic volatility stand out more prominently than other key threats in the next 12 months than over the next five years." @PwC @PwCUS

#macro #Stockmarket #DataAnalytics #commodities #supplychainmanagement #tech #CPI
Read 11 tweets
#Pakistan is going thru a complex #macro situation. At its heart is one symptom: the #CAD. Because the CAD has been perennial, this long-standing symptom translated into large foreign liabilities. Short 🧵👇
a) The #CAD shows that #Pakistan has been consuming beyond what it produces. At its heart, there’s another perennial deficit: the fiscal deficit.
b) To fix the #CAD, compressing #imports is futile (e.g. with the flood levy). You need either to reduce the fiscal deficit, or increase private saving well beyond investment. 👇
Read 10 tweets
Hello Friday and the week to date!

$GOLD +1.55%
$GBP +1.08%
$USD -1.59%

$TLT +2.35%
$HYG +1.47%
$TNX -3.36%

$IWM +4.65%
$DAX +4.31%
$SSEC +1.26%
$NIKK +0.56%

#Bitcoin +11.26%
$COPPER +7.42%
$WTIC +6.26%
$NATGAS -0.54%
$SILVER +0.08%

Let's dig into the market 🧮!
Asia closed ↗️ ex-Japan

$NIKK 26119 -1.25%
$SSEC 3195 +1.0%
$TWII 14824 +0.65%
$HSI 21739 +1.05%
$KOSPI 2386 +0.9%
$IDX 6642 +0.2%

Australia ↗️
$ASX 7328 +0.65%

India ↗️
$BSE 60276 +0.55%
Europe ↗️♉️

$DAX 15075 +0.1%
$FTSE 7840 +0.6%
$CAC 7009 +0.5%
$AEX 748 +0.8%
$IBEX 8910 +0.95%
$MIB 25831 +0.4%
$SMI 11327 +0.35%
$MOEX 2186 unch

$VSTOXX 17.49 🔻⬅️

$DAX range = 14237 - 15240 ♉️
Read 11 tweets
Roundup on #crypto and #macro
✅ 2023 > 2022 on liquidity
✅ 5% terminal rate
✅ China de-risk for global econ
🤔 War de-escalates
🤔 Q1 earnings, recession?

✅ Similar to 2015 cycle
✅ Deleveraged
🚩Imminent regulation
🤔 $ETH vs #BTC

I’m long here🐂
1. Terminal rate ~5%, priced in for an extended time of high interest rate (no easing for 1-2 years). Pace of rate hike to slow down, but liquidity is still bad.
2. Fear of recession is the biggest risk, all eyes on Q1 earnings and outlooks.
3. US M2 grew 25% in 2020 and 12% in 2021, much higher than 7% avg cagr since 1995. We are still at ~10% excessive supply versus where we “should” be. Liquidity for 2023 is marginal better than 2022, creating some support for price, but major rally seems unlikely.
Read 15 tweets

Important 🧵:

We’ve had a bear mkt rally which has now failed and partially unwound. Brief Santa rally or not, the following chart pack tells a clear story of impending volatility:

#macro #stocks $SPY $QQQ
Financial conditions:

This chart isn’t a mirror image - it’s the GS Fin Cond index against the #SPX. I’ve been tweeting updates on this for 6 mths because when conditions tighten, #stocks roll. Once again the Fed and now BoJ have triggered the tightening needed for inflation 🧯

10 year yields are on the rise again with added fuel from the BoJ pivot yesterday. As the benchmark the risk free rate, this is negative for #SPX in the near term
Read 9 tweets
#Fed day: the down/up reaction of #stocks shows something here for both hawks & doves.

For me (looking ahead), the Fed faces a dilemma in 1H '23. Cool/negative goods/energy inflation but still strong wage gains given tight labor.

Headline CPI...
will fall (particularly in Q1), potentially to even ~5% by March data, but wage gains will see medium term services & core inflation drivers inconsistent in the Fed's lens with a sustainable return to 2-3% target.

So Mr Mkt is saying based on history, the Fed never keeps...
rates at peak for long (ie the market assumes rate cuts soon after the peak).

But we need to consider that perhaps this time, with the labor pool down due to COVID and structural labor tightness, the #Fed may be FORCED to keep rates at the peak plateau for longer...
Read 10 tweets
1/5. The last 10 years, financial markets outperformed the real economy. Why? $9 Tn QE.

Return to capital > return to labor.

That is reversing. Real economy now outperforming financial markets. Jobs up, tech crash.

2/5: But, that also means the pricing of labor is more entrenched…

Inflation is more entrenched.

What started as asset price inflation has spilled into goods and sticky wage inflation.

The remedy? Fed policy is tighter for longer.
3/5: Also consider - outstanding mortgage debt is priced at a much lower rate (say, 3%). To create an impulse to housing via refinance, rates would need to ease to those levels before it had a significant effect.

Initial monetary easing will be ineffectual and delayed.
Read 5 tweets
Updated Inflation, rates outlook & prospects for #bonds and #stocks:

We're moving into a new phase of disinflation from here. This is what I expect to see unfold: Update 🧵:

#macro $SPY $QQQ #inflation
Back in early August I wrote that we were about to experience a surge in core inflation into end Q3.

At the time #stocks had rallied strongly and this presaged another pullback given it meant the #Fed had to be more hawkish.

I was a touch early w/ mths:
This played out and I've posted my multi-factor inflation model for US CPI previously. It shows #inflation moderating quickly in mid 2023:

Fair to say this generates skepticism. The narrative is once CPI >5% it stays there for > 2 years. Well where to now? Image
Read 13 tweets
My goal is to create a simple strategy/ algo/ code/ for inexperienced retail investors so they will not be left behind and finally gain the upper hand. A small but safe window of opportunity to make small but consistent profit. Here is how: (1/4)
A lot of traders entangle themselves in convoluted technical analysis & babysitting stocks for hours & days and they may pay a lot of money for advise services. The accessibility barriers; The block in front of you; the perceived k knowledge gap. You blame yourself… (2/4)
Some strategies may work for a while but it will need to be replaced. But #macro analysis along with basic technicals that are only based on buy/sell ratio, volume and price action will always remain relevant. Parsimony is a virtue. (3/4)
Read 4 tweets
#Fundamental and #chart analysis of leader of #cement sector #ULTRATECH #cement #Limited which has delivered good profit growth of 21.9% CAGR over last 5 years ImageImage
#Chart analysis of #ULTRATECH CMP 6903
✅Reason 1
➡️#ULTRATECH was in downtrend with fall from 8269
➡️This fall had formed very strong and textbook Head & Shoulder Pattern which is getting negated with breakout of equally strong inverse Head & Shoulder Pattern. Image
✅Reason 2
➡️Downtrend of #ULTRATECH with fall from 8269 was over after hitting 61.8% Fibonacci retracement level
➡️Stock has regained price above 23.6% level and next is ATH level
✅Reason 3
➡️Stock is above all moving averages ImageImage
Read 11 tweets
There is no point in arguing about employment today; there is a lag between tightening and the #HOPE cycle. Claims and UR didn’t rise until 4Q of 2000 and 2007. Until then people thought “employment was strong” … just like today. #macro #employment
If claims and the UR aren’t rising by mid 2023 then you have an interesting discussion. #macro
Proof is in the charts (and pudding). #macro $SPY
Read 3 tweets
PART 2 of 2 - Bond crash implications for stocks:

Why does the #bonds crash signal further pressure for #stocks?
(& why do rate hikes take so long to show in earnings?)

Here I deal with general corporates, consumer & the banks:
$SPY $QQQ #macro

As cost of capital rises, the direct impact on corporate earnings starts small then builds. The direct impact of higher rates on corporate borrowings can be estimated to be only approx -2-3% on EPS extra each year due to termed out debt at past low rates. But
about 20% of debt gets refi’d each yr so this builds to a more material headwind over 12-24 mths.


Working capital terms start to get tightened by companies as rates rise. Due to WC debt costs (mainly floating rates), companies are forced to offer
Read 21 tweets
What the updated US Inflation Model shows will happen from here:

The Fed's primary input into rate decisions continues to be CPI & as we know CPI is a lagging indicator. So what does data show will happen to CPI from here & the implications for rates?

#macro $SPY $QQQ #SPX #CPI
We've updated out US #Inflation model with recent data and the forecasts are critical for the rates outlook and timing.

Chart shows Actual CPI (light blue) vs model (dark blue). Image
As can be seen, the peak is clearly past but #CPI will likely stay high to year end. The model suggests in the vicinity of 7.5% still by end December.

What happens in 2023? Image
Read 15 tweets
Love your stuff @AndreasSteno but I have to emphatically disagree with your conclusion here. It wasn’t peak CPI that lifted stocks, it’s was Fed rate cuts followed by a HUGE eco recovery (PMIs 🆙, claims ⬇️), as CPI happen to peak, that did it IMO. Charts (2) speak for themselves
PMIs are only trending one direction for a while - same for housing. Same reasons we called BS on the market rally in August - wasn’t consistent with EVERY other market low
Just watch housing starts and ISM new orders. No new bull markets until they are rising (or about to do so). #macro $SPY
Read 4 tweets
Brief #Macro thought:
1) As interest rates remained near zero during much of the past decade, the TINA (There is No Alternative) thesis supported equity valuations. In this environment, asset managers were forced to invest far out on the risk curve, which supported #NASDAQ and #crypto.
2) With the Fed now committed to beating back inflation, short duration Treasuries are hovering around 4% yield. Thus the environment has shifted from TINA to TARA (There are Reasonable Alternatives).
Read 4 tweets
1/ Expanding the Macro - a Treatise on what I see
#macro #market analysis 9/17
So first thing I want to point out, is the divergence between wishful @Binance $BTC weekend price and #CME's. Just to knock out crypto quickly - here's the weekend divergence.
2/ There's 3 ways it goes, but in *decreasing* order of likeliness. 1: we return to that gap to then pick a direction, 2: we tap it for a second upon open tomorrow (18 hours from now) and then continue upwards, or 3: we leave a gap that we fill on 9/21 #FOMC
3/ is $ETH in the same boat? You bet. So that's #crypto for the weekend, for anyone following. Lots of caveats can be applied here to add additional analysis
Read 16 tweets
Since Central Bank swap lines are probably going to start blowing up again because of energy and FX issues, I decided I would make some charts on their usage during COVID. Because why not.

short thread
#btc #macro #DXY
Currency swaps are a loan. Fed buys foreign currency from a central bank, and agrees to sell back later for same amount of $, plus interest (in $). The € or ¥ could devalue vs $ in meantime, making that loan cost more than the published interest rate
Mexico, Korea, and Singapore got really screwed on their 12-week swap interest rates early in the pandemic. (1.08% vs 0.3%). Mexico's own policy rate at this time was pretty high, but the others were basically zero. Later they all got the same rates.
Read 10 tweets
DoubleLine CEO Jeffrey Gundlach presents "Rehab."

Tune in Thursday, 9/15/2022 at 1:15 pm PT | 4:15 pm ET.

#macro #markets #commodities #Fed #inflation #growth #rates #stocks #bonds #EM #Europe #USD #FOMC #Powell #recession Image
.@DLineCap CEO Jeffrey Gundlach: I think the U.S. needs to go into rehab
Gundlach: There are 1,250 IRS agents who are not paying taxes. 87,00 new IRS agents coming.
Read 65 tweets
Ehi there #Crypto and #macro Twitter

Time for #market analysis #Number20!

"The CPI news flushout"

I will explain here what happened since last week, and cover the #crypto market starting from #onchain #BTC, going into #Technical Analysis + #macro🧵
First of all, if you want to have a deeper insight in what happened the week before, you should check my last #weekly #analysis

I'll put the link here for you:

But let's start digging into this week, should we?
For as much as I would like to start with the onchain data, this week I'll have to retreat to an TA and macro analysis at first, onchain will have to wait I guess.

There a lot of important information to put out before entring the blockchain realm
Read 23 tweets

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