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IZ

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Oct 14 • 9 tweets • 3 min read

@concodanomics

1/n
It really is all one trade.
Risk markets LTM.
Liquidity and $SPX
👀
cc: @concodanomics

2/n
Liquidity and $DXY
👀

3/n
Liquidity and real rates
👀

4/n
Real rates and $DXY
👀

5/n
Real rates and $SPX
👀

6/n
Real rates and FCI
👀

7/n
FCI and $SPX
👀

8/n
$SPX and $DXY
👀

https://twitter.com/siddiqui71/status/1568909802755039233

n)
Bonus: impact of SLR relief expiry on liquidity
#SLR

https://twitter.com/siddiqui71/status/1568909802755039233

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IZ

@siddiqui71

Oct 9

https://twitter.com/biancoresearch/status/1579150456433303553

1/n
Respectfully disagree with almost everything you posit in the first tweet. In a credit based economy
- at 125% debt/GDP
- tightening liquidity with >$1T withdrawn
- most aggressive/rapid hiking cycle in history
- inverted curves
- $ spiking -> global FX imbalances

https://twitter.com/biancoresearch/status/1579150456433303553

2/n
-global tightening -> global economy on the brink
- equity/risk asset markets imploding
- housing tanking
- $ trillions in refinancing required at higher rates/lower appetite
- savings rate collapsed while revolving credit at new highs
- fiscal stimulus tailwind evaporated

3/n
-earnings recession on the horizon
- unemployment at 3.5% 😂
- and the Fed committed to slaying inflation (using a backward looking CPI)
So I fail to see how “credit crunches and deflation is over”!
And how we could be “in an era of higher rates and persistent inflation”?

Read 5 tweets

IZ

@siddiqui71

Jan 15, 2021

@gamesblazer06

1/n
Whoa! This is a firecracker. I'll wait for PPT (@gamesblazer06) and @Stimpyz1 to argue both sides of the argument. Here's my take FWIW.
In Jan 2019 the Fed decided to implement an "ample reserve" regime. This has important ramifications for money markets. As Fed ...

2/n
... assets⬆️ e.g QE, composition of the Fed's liabilities also changes. As TGA balance⬆️ ($1.6T currently), bank reserves⬇️ (currently $3.2T). TGA balance is expected to ⬇️ due to fiscal relief. RRP, a tool for MMFs to invest at a fixed rate, places a floor under ....

3/n
... O/N rates. RRP balance is currently very low.
Note that in an "ample reserves" regime (i.e. reserves balances well above what is needed for payment purposes), banks are comfortable (a) investing excess balances when return on HQLA > IOER, and (b) taking deposits ...

Read 8 tweets

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