A few notes on SWIFT, and the prospects for #Russia being cut off from it, just for background 👇 SWIFT is a communication platform used by banks, brokerages and other financial institutions. So if a German company buys Russian gas, it transfers money from German bank to Russian firm’s Russian bank by entering recipients acct num and SWIFT code.

Several of our #Ethereum metrics have turned negative since our last report:
• Futures open interest has reversed course and is now decreasing
• The put-call ratio has started to rise again
• Exchange flows have a bias for inflows
• Renewed outflows from ethereum ETFs Risk aversion is likely to be the dominant theme for markets, and with the correlation between #ethereum and NASDAQ picking up again, broader risk sentiment will likely be the dominant driver of ethereum.

We recently had Adam Iqbal on our podcast show. We focused mainly on FX and options. We thought we'd share with you his 'Rules of Thumb For Trading Options'.
🧵👇 1) "The best one, the one that I use every single day when I sit down the desk, really, what you need to do is just remember this one number, which is 4.2, it’s the most important number in options."

Our latest #explainer is on semiconductors and the global chip shortage! Here is a brief background on them 🧵 1) Semiconductor shortages have been big news since the pandemic. No single factor explains them. COVID was clearly an exacerbating factor, but the issue has been around for much longer.

How should investors position for high inflation and policy normalization?

@macrocredit gave us his thoughts on a recent #MacroHive exclusive.

Here is what we learned 👇🧵 1) The Fed, the ECB and BoE are behind the curve. Normally, a tightening cycle would start during rising growth momentum. This time, however, central banks are likely to tighten as fiscal stimulus fades.

[1] Few things to think about on equity diversification from a brilliant academic paper we recently summarised 🗒️

The paper explores whether the liberalisation and integration of financial markets have limited... [2] ...investors’ opportunities to diversify risk across countries. They have not.

Chart 3 shows the time-series behaviour of average corr. between countries. On avg across the 63 countries, global equity price correlation has not increased significantly over the last 40 years.

Where does #inflation, US Treasuries and markets go from here? John Welch shared his rather unconventional view exclusive to Macro Hive.

Given how important this is, here's a quick summary: [1] In an era of massive QE, we cannot ignore Milton Friedman’s warning that ‘inflation is always everywhere a monetary phenomenon.’

Here's a quick update on our Asia Currencies & Commodities views in partnership with @SGX, so you can keep an update on the markets that matter🐝 [1a] #China: policy easing continues. The PBoC became the first central bank to cut rates in 2022 with a 10bps cut in the one-year medium-term lending facility (MLF) to 2.85%. This was the first cut since the height of the Covid stress in March 2020. Yet $CNH remains stable.

Awesome new IMF working paper exploring the connection between crypto and equity markets, comparing pre- and post-pandemic period - we just had to write a Hive Deep Dive summary!

Here are some key takeaways 🧵 [1] Starting with simple correlations, the intra-day price #Bitcoin and #Ether, is now about 4-8 times more correlated with the volatility of the main US equity market indices (the S&P 500, Nasdaq, and Russell 2000) versus 2017-19.

(1/13)
Grey Swans are those low-probability, high-impact events that few expect.

Last year, we had picked 10 Grey Swans for 2021. Amazingly, some materialised. Notably, the Democrats won the Senate, and inflation surged.

Here are our 12 for this year 👇 (2/13)
Pundits are Wrong! US Enters a #Recession in 2022

Almost no one is looking for a US recession in 2022. Economists’ consensus assigns only a 15% probability. Clearly, most expect US growth to lose momentum. So why not expect a US recession?

In our latest set of academic curations, we feature papers on volatility-managed portfolios, the UK economy, and more [1/5] 'Do limits to arbitrage explain the benefits of volatility-managed portfolios?' @sciencedirect [2/5] sciencedirect.com/science/articl…

Once a week, we curate some of the best academic papers on global macro and markets. In this thread, you can find links to some amazing papers on exchange rates, CBDCs, Hedge Fund Startups, and more [1/5] @CambUP_Econ @econschmidt [2/5] inet.econ.cam.ac.uk/working-paper-…

[1] We've had many great guests on our podcast show 'Macro Hive Conversations' this year.

We often ask our guests for their best book recommendations.

So, we've compiled them for you to add to your reading list for #2021, on topics such as trading, society & more! 👇 [2] We've categorised these books into:
1. Portfolio Management & Trading (Tweets 3-7)
2. Monetary Policy (Tweets 8-9)
3. Economics & Finance (Tweets 10-17)
4. Society & Productivity (Tweets 18-22)
5. Classics & Memoirs (Tweets 23-27)
6. Books Written By Our Guests (Tweets 28-43)

We curate some of the best academic papers weekly, in our latest thread, we feature papers on recessions and mortality, fiscal deficits and inflation, and more. [1/6] An interesting historical piece on @nberpubs that expands on the growth in financial economics from 1974-2020. [2/6] nber.org/papers/w28198

In our latest curated list of global macro and markets blogs, we feature pieces on Ethereum, inflation, inequality and social unrest, and more. [1/9] @LizAnnSonders @CharlesSchwab [2/9] schwab.com/resource-cente…

I've spent over 20 years at large investment banks, where I ran global research and strategy teams across multi-asset, FX and fixed income products.

Here's my list of the best bloggers on #economics and #markets you NEED to follow today.

Is there anyone we may have missed? 🧐 In no particular order:

1\ Managing Editor of the Journal of Economic Perspectives, @TimothyTTaylor, is somehow able to write on 3 or 4 meaty macro topics a week. This can range from the share of veterans among prime-age men to environmental economics: conversableeconomist.blogspot.com