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Capital Flows Profile picture
Capital Flows
@Globalflows
Global macro research focusing on asymmetrical opportunities in rates and equities | Educational primers and dynamic models mapping capital flows(free)⬇️
9 subscribers
Jul 2 • 18 tweets • 9 min read
Here is a comprehensive breakdown of the tools and educational resources for understanding how capital flows are impacting interest rates, equities, Bitcoin, and gold (FREE)

“You wasted $150,000 on an education you coulda got for $1.50 in late fees at the public library.”

🧵👇 Image 1) Book recommendations on global macro
Jul 1 • 12 tweets • 4 min read
The macro picture is confounding positioning in both interest rates and equities

The economic data prints today are sending a signal that will reverberate across asset markets

The main idea: NO RECESSION

🧵👇 The idea I have been consistently laying out is that a recession is highly unlikely right now. This is why I have been long equities
Jun 30 • 15 tweets • 5 min read
The macro regime has made a short-term shift from bear steepening to bull steepening in 10s30s

This has implications for risk assets, gold, and FX, especially since volatility is so low right now

Let's dig in🧵👇 Image Let me first start with, if you don't have a correct understanding of WHY the yield curve is flattening or steepening, you will never know WHERE we are likely to move.

This is why I wrote a comprehensive primer on understanding interest rates here:
Jun 29 • 12 tweets • 5 min read
Last week, Powell made his comments about the Fed's stance, and this has set the stage for bonds as we move into the labor market prints this week

This is going to further squeeze out positioning in equities and interest rates

Let's dig in 🧵👇 Main idea is that economists and macro strategists have had the expectation that a recession was a considerable probability this year due to the tariffs.

The chart below shows their expectations of a recession. It was previously at 40% and is beginning to move down as they realize they were wrong.Image
Jun 27 • 15 tweets • 5 min read
The US financial system is on the verge of a massive boom in BOTH the underlying economy and the financial system

These types of booms occur when the Fed makes critical errors. Powell sent a clear message to the market that he is way more dovish than justified.

🧵👇 For months now, I have been systematically laying out all of the drivers for the credit cycle that are occurring under the surface. The main idea is that banks were telling everyone a recession was likely at the same time they kept shooting credit into the system:
Jun 18 • 14 tweets • 5 min read
As we move into FOMC, understanding HOW the curve is pricing the Fed's action and what you watch will be critical

Powell has already made mistakes over the last 3 months and now the pressure from Trump is going to compound them

Let's dig in 🧵👇 When we understand HOW the stance of the Fed relates to markets then we can know that 30 year interest rates have been rising for almost a year now. This is taking place as the Fed takes a "neutral stance."

The result? A large gap is forming Image
Jun 18 • 12 tweets • 4 min read
A massive rate futures position is taking shape: traders are betting that the next Fed chair — post-Powell — will move to cut rates aggressively starting mid-2026.

This has triggered record SOFR fly flows and distorted curve structure. Let’s walk through what’s happening 🧵 The core of the bet:
→ Sell Mar 2026 SOFR
→ Buy Jun 2026 SOFR
This anticipates that Powell’s successor, potentially appointed by Trump, would ease policy quickly after taking office.
📊 Chart: SOFR fly distortion and volume spike Image
Jun 18 • 10 tweets • 2 min read
In the aftermath of pandemic-era QE and rising fiscal dominance, US regulators are now moving to adjust capital rules that affect how banks intermediate the $29T Treasury market.

The proposed shift targets the enhanced Supplementary Leverage Ratio (eSLR)—a structural constraint in the balance sheet era.
🧵 At the center is the enhanced Supplementary Leverage Ratio (eSLR) — a key capital requirement for the biggest US banks like JPMorgan, Goldman, and Morgan Stanley.

Today, it forces banks to hold capital against even the safest assets — including Treasuries.
Jun 17 • 10 tweets • 4 min read
BTC charts showing WHERE we are: 🧵

My view is we are moving higher because macro liquidity is expanding and this geopolitical risk is likely to fade. The Credit cycle is in full swing

Monthly returns for BTC have been positive over the last two months Image As I laid out here equities are likely to melt up and BTC will move in lockstep with this.
Jun 17 • 11 tweets • 2 min read
1/
 @elonmusk AI startup, @xai, is on pace to burn over $13B in 2025—more than $1B/month.
Revenue? Just $500M this year.
Next year? $2B projected.

The funding treadmill is accelerating faster than the product.

Here’s the full breakdown 🧵 2/
 xAI just merged with X and is raising $9.3B in equity + debt.
Over half will be spent in the next 3 months.
They're also planning to raise another $11.4B next year.

Burn rate like this is unprecedented—even by AI standards.
Jun 17 • 10 tweets • 3 min read
The Fed's "path-dependent" language is a disguise for falling behind the curve

Powell realizes he is going to get replaced in 2026 and this is going to begin to inform both his decision making AND how the forward curve prices rate cuts.

This is setting the stage for flows🧵👇 The chart below shows a quantification of Powell's rhetoric vs the 30 year interest rate

there is a massive divergence taking place because powell has decided to pause as growth and inflation accelerate Image
Jun 17 • 8 tweets • 3 min read
Nothing has changed from the equity thesis I laid out here but there are several charts you want to be aware of for monitoring the regime: 🧵👇 The stock bond correlation regime remains negative. This means that the market continues to show resilience to higher rates and rally. This is why we are not in a 2022 type regime. Image
Jun 16 • 24 tweets • 7 min read
Why Investors Are Forced to Buy Equities: The Macro Constraints That Create Melt-Ups

When liquidity rises and growth improves, capital isn’t free to go anywhere—it’s forced into equities by structural constraints. Melt-ups aren’t a choice. They’re a function of flows.🧵👇 Macro liquidity is defined by the quantity of money in the system and the level of interest rates. As it interacts with growth and inflation, it determines the return profile for every asset. When liquidity expands, capital is mechanically pushed out the risk curve—because in a world of abundant money, capital is forced to chase the highest return.
Jun 16 • 13 tweets • 5 min read
The Fed is allowing interest rates to compress in a range as this geopolitical shock and credit in the system

This is setting the stage for the next move which will reverberate across equity markets and Bitcoin

Let's dig in 🧵👇 The spread between bond volatility and crude volatility has expanded significantly over the last 3 trading days

This is partially because bonds had a short-term bid for safety during the initial geopolitical reaction. Additionally, traders are waiting for the FOMC meeting this week.

What is important is looking through the noise and thinking about the 2nd and 3rd order effects.Image
Jun 16 • 14 tweets • 5 min read
We are entering one of the most violent periods in markets but this isn't driven by a recession, it's driven by the credit cycle

The sheer amount of money being added to the system right now is creating an environment for equities that is very rare

Let's dig in 🧵👇 When we entered this year everyone was all bulled up on the new Trump victory. This positioning was shocked by the tariffs and it caused the entire market to go way offsides to the point that they thought a recession would take place

Economists still have recession probabilities at 40%!Image
Jun 12 • 14 tweets • 6 min read
The concerns around recession, inflation, and the Fed frame WHERE equities are going on a cyclical basis.

The key is aligning the structural macro drivers with cyclical changes and then executing trades when positioning is offside.

Let's break each of these down (Pt1) 🧵👇 On a structural basis, delinquencies remain VERY LOW which is why equities continue to shake off drawdowns. Underlying growth in the economy continues to rise and we aren't seeing signs of a recession comparable to a 2008 regime. Image
Image
Jun 12 • 13 tweets • 3 min read
The Top Intro Books For Macro And Markets: 🧵 Image Image
Jun 9 • 20 tweets • 7 min read
Having a proper view of Bitcoin is based on two things:

1) Macro liquidity
2) Positioning

We are seeing an alignment of factors that is beginning to set the stage for a final move in BTC

I am going to break down the drivers and risk/reward for WHERE we are going 🧵👇 BTC had a positioning unwind earlier this year because every major investment bank was floating a narrative that the tariffs would cause a recession. When this didn't happen, BTC and equities had to reprice higher. As a result, the 100k level functions as really clear cyclical support so as long as we don't have an imminent recession (highly unlikely) we are unlikely to break BELOW that levelImage
Image
Jun 9 • 13 tweets • 4 min read
Financial markets are approaching a tipping point similar to 2021 when the Fed actively decided to let inflation run hot and let equity markets melt up

We are in the early innings and the signals are flashing right now 🧵👇 I have been laying out for a while that bonds are moving to the downside because the Fed has failed to adjust as more credit gets pumped into the system
Jun 7 • 18 tweets • 6 min read
We are entering a period of macro liquidity that is creating a violent squeeze in short positioning that is similar to 2021 when $GME made its historic rally

Hedge Funds are about to get caught offsides again 🧵👇

@TheRoaringKitty and @unusual_whales = important for this Image We entered this year with a massive washout in long positioning and hedge funds were able to limit their drawdowns by being short or hedged.

The tail index showing the pricing of OTM puts on SPX blew out with the VIX showing a massive premium for hedges. As this went down, everyone began to realize they the tariff dynamic was all misdirection by @realDonaldTrump and @SecScottBessent and they needed to get long fast.Image
Jun 6 • 20 tweets • 6 min read
There is excessive focus on an imminent recession in the US

We are seeing @elonmusk, corporations, and economists all have the same consensus about risks to growth

The credit cycle is telling a different story and this will have massive implications for markets 🧵👇 Right now we are seeing one of the largest setups for consensus extrapolating fear in headlines to a collapse in growth.

Economists (the guys who are always wrong) are expecting a 40% probability of a recession right now: Image