Alf Profile picture
29 Dec, 6 tweets, 2 min read
The most important thread of mine in 2021: the 5 must-follow food laws in Naples (mostly applicable throughout Italy).

I am from a small town close to the Amalfi Coast, where GDP per capita is $20k/year and youth unemployment rate is >30% but we know how to make a pizza!

1/6
Rule #1

NO cappuccino or any other types of coffee containing milk after 11am (the strictest Italians would say this is not allowed after 9am).

Milk after 11am is for kids, and adults are allowed to drink it in any format only early in the morning.

Later?
Just. Don't.
Rule #2

Pizza is not crispy, not crunchy, not <1mm thin
The proper Neapolitan pizza has a fluffy & airy outside crust, it gets thinner towards the center and it melts in your mouth

Looks different than what I described?
Then it's NOT Neapolitan pizza

My best effort in the pic!
Rule #3

Allowed toppings for pizza: plenty of things, actually.

Mostly stay away from:

- Chicken
- Pineapple

We might try to kill you if you go for one of the above.
Rule #4

Pasta al dente, for f**k's sake!
We are not at the hospital here, and neither our teeth are damaged such that we must eat super soft and chewy stuff.

Also, if I see a bottle of ketchup nearby a pasta dish I'm going to call the police.
Rule #5

No, you can't mix salad, pasta and meat in the same plate. Have a bit of self-respect.

One plate for your salad, one for your pasta, one for your meat/fish.

Che c*zzo!

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More from @MacroAlf

30 Dec
While US mid-term elections draw quite a lot of attention, market commentators often overlook one of the most relevant political events: the Chinese Politburo meeting.

In Oct/Nov 2022, the CCP Politburo will hold its 20th National Party Congress.

A short thread.

1/6
To Xi or not to Xi?

Chinese officials are generally asked to retire when they reach 65-68y of age - this rule is often applied for some but not for others, and for sure Xi will not be upheld by this.

But there are other relevant CCP members who could be influenced.

2/6
Assuming we get another 5y of Xi, how will he handle the inevitable real GDP per capita slowdown China is and will be facing?

Even if you are China, you can't fight demographics: labor supply growth will turn negative (!) in this decade and real GDP growth converge to 3%

3/6 Image
Read 6 tweets
29 Dec
Inside money and real-economy money.

That's your easy way to think about what operations are (at least short-term) inflationary and which ones are asset price inflationary only.

Inside money never reaches the real economy.
Real-economy money does.

1/10
If the govt spends money it does not plan to collect taxes for, real-economy money has been created

A bank making a new loan literally credits your account out of nowhere (banks don't lend deposits or reserves)

This is real-economy, potentially inflationary money creation

2/10
Can you see how this might be short-term inflationary? Expansion of credit or net govt spending boosts aggregate demand temporarily.

Ceteris paribus and with a lag, this pushes prices up 2020/21 is a prime example: massive credit creation + supply bottlenecks = inflation

3/10
Read 10 tweets
28 Dec
''The Fed is lying to us! They told us they would taper in December, but the balance sheet keeps on growing!''

And the smarter people are adding ''It keeps growing at the same pace as before!''

Seen enough of this crap, time to clarify.
No, they are not ''lying'' to us.

1/
The Fed announced it would start to taper its asset purchases from $120 bn to $105 bn per month in December.

But the Fed balance sheet size increased by $140 bn in the first 23 days of December alone!
How is this possible?

2/
As you can see, the Fed sheet is not only driven by bond purchases.

The FRBNY releases a comprehensive weekly overview (H.4.1) of the asset and liability side of the aggregate Fed balance sheet.

Nevertheless, delta in Treasury and MBS holdings move the needle the most today

3/
Read 7 tweets
27 Dec
One of the great privileges I had while running a large portfolio was to be able to network with super smart people in the industry.

Here are the most compelling quotes from the real, big risk takers out there - hedge fund PMs, big market makers, very large and active funds

1/5
Friend and successful PM at a top-tier HF, clocking in $25m P&L/year

“Alf, I don’t have a crystal ball. It’s all about risk management: I approach every trade as if I’ll lose money. I ask myself how much money I am willing to lose on the trade, and size accordingly.”

2/5
One of the biggest market makers in fixed income out there

“Every morning my alarm goes off, and my display asks me how much am I into consensus trades? When the dance floor gets crowded and the exit door is small, it’s very tough to get out if there is a fire…”

3/5
Read 5 tweets
25 Dec
Santa Alf is coming!

A shoutout thread for the best FinTwit people out there - those are all nice, and highly valuable accounts to follow.

No pr*cks allowed on this list.

I will miss many for sure, feel free to shoutout for your preferred global macro accounts!

0/11
First mention to my friend @AndreasSteno. A truly awesome guy, who is well versed at global macro and can change his mind as facts change (very rare!).

We all miss him, but a bird told me we won’t have to wait long!

1/11
A smaller but fantastic account is @dampedspring. I recently had a chat with him on @RealVision and it confirmed what I already knew: he has a solid framework, he can elaborate very well and he is honest with his P&L as he managed real money and knows the game.

2/11
Read 12 tweets
24 Dec
Our grandmas would be proud of us tonight.

Proper Southern Italian dishes, which also means f**k the look, it must taste good and portions big enough to feed an army.

All religiously handmade - no cheating.

Enjoy!

1/10
This is how you start: enough salami, ham and cheese to make you feel full…but you just started.

2/10
Ok grandma, we deviated a bit here.

Muffins with pancetta and melted cheese.

Smells amazing, tastes better.

3/10
Read 10 tweets

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