More on the retail options frenzy ...

Deltec Bank & Trust Ltd. shows, trading in options has in the last two months outstripped trading in underlying cash equities for the first time on record.
60% of options trading is in contracts with less than two weeks to expiration

Well over 2,200 stocks have options contracts listed on an exchange. The VAST majority of trading is in just seven names.


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More from @biancoresearch

16 Sep
A thread explaining why the bond market is asleep and what wakes it up.


The next chart shows the MOVE Index (Merrill Options Volatility Estimate). It is the “VIX of the bond market” and is near its lowest reading in history (which was set on July 30).

Should interest rates be this low? Consider these 2 charts.

The bond market often moves in tandem with commodities. But as the boxes show, that has not been the case recently.

Commodities are suggesting interest rates should be moving higher, but they are not.

* Top panel shows the SPX (log)
* Orange bars show the VIX’s close on days the SPX hit an all-time high (ATH).

VIX hit 26.57 when the SPX hit an all-time high on Sep-2. The VIX has never been higher with SPX at ATH.

Stocks are not exhibiting low levels of volatility.

Read 10 tweets
14 Aug…

He would be comfortable with inflation around 2.25% or 2.375%. The policy, known as average inflation targeting, would be a shift from the Fed’s current way of keeping prices stable, in which it targets 2% regardless of what happened in the past.

What Avg?

Below uses YoY chg in core PCE (orange) and the 6-mo Avg of this chg (yellow).

Kaplan's target has only been reached one time in the last 25 yrs, 06/07.

What would the reaction to Kaplan's comments if it was spun as "Fed ok with a 25-year high in inflation"?

(2/4) Image
To be fair, the Fed says they target headline. I would argue they really mean core.

The difference is largely gas prices.

Why core? Every time headline inflation surges because of gas prices, they call it a "tax" on the economy and back away from hiking rates.

Read 4 tweets
9 Aug
The most active @PredictIt now is VP betting, regularly over trading 1M contracts a day (bottom panel). Total Open Interest is 20.8M

Harris leads has always led. But she is going the wrong way and now under 50%. Rice and Whitmer are rallying. No one else above 5%.

The decision is expected next week

My interpretation of this price action, Harris is the default choice they will settle with but they are desperately looking anyone/someone else.

Remember our view ...

Betting markets aggregate all known information into one probability into a type of real-time poll.

Does mean they are right, but all the KNOWN information suggests these are the most likely probabilities.

Read 4 tweets
23 Jul
Today's case count hit 70k again ...

… led by the southern states ... but note some hope ... the seven day average (orange line) might be peaking.

Now for the bad news ... a potential new hot spot unfolding ... the upper Midwest. The 7-day average (orange) made a new all-time peak today, taking out its May peak.

Read 6 tweets
19 Jul
States making new high, or starting 2nd waves, they are headed by democratic governors here

Below is the states headed by republican governors making new high (orange line) or forming second waves.

This is not a partisan issue. @TBPInvictus

More states headed by republican governors

Still more states headed by Republican Governors

Read 4 tweets
19 Jul
The biggest problem with the CV19 discussion is it has become a substitute for political preference. Your opinion about the virus is nothing more than screaming "I'm a D" or "I'm a R."

Assuming the worst offenders disagree, let's go through the data

Here are the states headed by democrats governors that have seen a new high in the 7-day average (orange line) in the last week.

More states making new highs with democrat governors

Read 5 tweets

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