-If Fed cuts aggressively here, JPY goes to 120 and every CUSIP has a flash crash, as the carry trade blows up.
-If Fed cuts slowly, then it may just blow everything up anyway, cause the economy is rolling over and the ‘wealth effect’ was the only thing holding it up.
-Meanwhile, we just had a 10-yr auction that effectively failed. So if the Fed cuts at all, they blow up the bond market and the banking sector. They realistically need to raise rates aggressively here to save things (imagine that!!). That’s the EM Dilemma. Which is why DMs do not want to become EMs. Or in other words, ‘they’re fuct!!’
bill /
npub1ae…zz0fu
2024-08-25 15:56:58
Author Public Key
npub1aef86m9dhfrmmaypgtznpnsz4vjjwhdjs45eaqzl9pjcs02hqhsq5zz0fuPublished at
2024-08-25 15:56:58Event JSON
{
"id": "9b3dae3b1666931f13426adb9ca5df2e428e94ac020256ade8667c54040f265a",
"pubkey": "ee527d6cadba47bdf48142c530ce02ab25275db285699e805f2865883d5705e0",
"created_at": 1724601418,
"kind": 1,
"tags": [],
"content": "-If Fed cuts aggressively here, JPY goes to 120 and every CUSIP has a flash crash, as the carry trade blows up. \n\n-If Fed cuts slowly, then it may just blow everything up anyway, cause the economy is rolling over and the ‘wealth effect’ was the only thing holding it up. \n\n-Meanwhile, we just had a 10-yr auction that effectively failed. So if the Fed cuts at all, they blow up the bond market and the banking sector. They realistically need to raise rates aggressively here to save things (imagine that!!). That’s the EM Dilemma. Which is why DMs do not want to become EMs. Or in other words, ‘they’re fuct!!’",
"sig": "c50c64df763f636448e5b0b19302cf5defaca046aa45432b757ebbfdc6acff15fbc2e2d3b55c0ab88854f34116498c2a49ba7fe5417923ff0f7c8a1644a23d02"
}