More from @Convertbond

Lawrence McDonald

@Convertbond

2 Jul

@BearTrapsReport

US Employment Total Full Time Jobs

2021: 126m**
2020: 114m
2019: 132m
2018: 129m
2017: 126m**
2016: 123m

*close to 6m jobs below 2019 levels, Bureau of Labor Statistics data.

via @BearTrapsReport

Full-time jobs rolling over? What gives?

USA Full Time Jobs

2021: 126 million vs. 333m population
2007: 122 million vs. 300m population

(3)

Read 5 tweets

Lawrence McDonald

@Convertbond

2 Jul

U6 Unemployment in the USA 9.8% is all you need to know, still, nearly 7 million people are NOT in the labor force than were in, Jan 2020.

@carlquintanilla

Since 2007, US full-time jobs are +4 million with a population +32 million. This is one of the MOST important macro-political economic facts that exist today, with colossal implications.

cc @carlquintanilla @andrewrsorkin @elerianm @nfergus @Neil_Irwin @gilliantett @DougKass

The easy answer nearly EVERYONE falls back on is the aging population, retirement - demographics. It is an important piece of the puzzle but hides a dark picture. In June 122,000 persons, 25 to 34 years of age left the labor force.

Read 5 tweets

Lawrence McDonald

@Convertbond

2 Jun

Dear $AMC Shareholders, Credit Markets are trying to tell you something, will you listen?

New Post - AMC 5.75% due 2025 are offered at 81 cents on the dollar. Meanwhile, the stock is trading at all-time highs. The disconnect indeed is very telling...

thebeartrapsreport.com/blog/2021/06/0…

AMC JUMPED MOST INTRADAY SINCE JANUARY - Bloomberg

@BearTrapsReport

Today

Bonds: AMC 5 ¾ 06/15/25 down at 79.795 / -$0.232

vs.

Equity up at $62.55 +$30.51

via @BearTrapsReport

*After 30 years of trading stocks and bonds, 95% of the time I can assure you, credit leads equities. That´s a 12.25% yield to worst vs. 5 year Treasuries at 0.79%.

Read 7 tweets

Lawrence McDonald

@Convertbond

28 Mar

@andrewrsorkin

We have had 3 recent LTCM like blowups:

March 2020: Relative Value Interest Rate Swaps

January 2021: Melvin Capital

March 2021: Archegos

*Common denominator? Massive Leverage.

Join @andrewrsorkin and @Convertbond tomorrow on @SquawkCNBC at 6:45am for the backstory.

Nomura $2B hit on tape

Nomura is a small prime broker, CS is a big one, MS / GS as well, CS must have the biggest hit relative to Nomura at $2B - we have to assume $8B to $12B hit across them all?

CDS was telling us something Friday.. Credit leads equities..

1. No one knows how big he was or how levered.
2. Have to assume goldman went first and protected itself. MS not far behind.— but with bigger exposure could have a loss. Those that acted slower (nomura, cs) probably left holding the bag???

(3)

Read 4 tweets

Lawrence McDonald

@Convertbond

26 Feb

The Year 2021

Two 6 standard deviation moves so far.

- hedge fund deleveraging in the GameStop drama.

- relative value rates, sell-off in 5s vs rest of the curve, US treasuries.

*in both cases too much capital was hiding out in crowded venues.

When central banks do NOT allow the business cycle to function over longer and longer periods of time - the good news is wealth creation becomes colossal. Bad news is Capital moves into crowded venues, poised for disruption.

(2)

In rates, as the bond market sold-off. Originally, the long end 30s was deemed at risk, capital moved into 10s, 7s, a “safe” place. As selling pressure moved into the middle part of the curve, trillions moved into the front-end looking for duration risk shelter.

(3)

Read 5 tweets