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Days of Theater

By Ben Hunt | November 17, 2023

Every macroeconomic data release will be parsed and presented by Wall Street and the White House to pressure the Fed to lower the price of money. That storytelling effort will be particularly strong when everyone is paying attention on a Day of Theater.

Like a CPI release.

The Yen Narrative Domino

By Ben Hunt | November 2, 2023

Earlier this week, the BOJ ‘tweaked’ their YCC policies again, this time eliminating their hard commitment to buying unlimited amounts of 10-year JGBs to maintain a 1% cap on rates. Instead, 1% is now just “a reference”, not a hard and fast target. And with that, the yen blew past 150, weakening to 151 and change.

And now the story-telling begins.

The Great Unmooring

By Ben Hunt | October 23, 2023

I am increasingly convinced that it’s not only interest rates that have become unmoored in Narrative-world, but also our banking system and our housing finance system … and our domestic political system and our international security system.

We’ve moved from an unmooring of long-dated interest rates to an unmooring of everything.

This Is What Unmooring Looks Like

By Ben Hunt | October 13, 2023

On Wednesday, October 11, the 30-year yield declined 13.8 bps (NY to NY last trade), its third biggest one-day decline in yields since November 2020.

Yesterday, October 12, the 30-year yield rose 16 bps. This was the biggest one-day increase since March 2020.

This is what unmooring looks like!

The End of the Beginning

By Ben Hunt | October 6, 2023

The Narrative archetype “Supply and Demand” tm is typically trotted out to describe a market move that no one has a better answer for. It’s not particularly useful for a directional trade, though, as it is inherently cyclical and mean-reverting.

Discovery Phase to Mainstream Phase

By Ben Hunt | September 29, 2023

It’s important to recognize that a Big Trade is a long campaign made up of dozens of Narrative battles and skirmishes. We won the first battle – and that’s great! – but now it’s on to preparing for the next.

The Dot Plot IS Forward Guidance

By Ben Hunt | September 21, 2023

Why did the Fed slap down Mr. Market’s expectations of massive rate cuts in 2024?

Because the most important thing for the Fed is not to be right, but to be believed.

The Ghost of Arthur Burns

By Ben Hunt | September 14, 2023

In Narrative-world, we have now redefined core CPI to not only exclude food and energy prices directly, but also indirectly. If airfares went up in-line with or ‘because of’ rising fuel prices, then obviously we need to ‘adjust’ those airfare readings for a ‘true’ core CPI, right?

The ghost of Arthur Burns haunts us still.


By Ben Hunt | September 7, 2023

The latest Narrative development I’m seeing is that the US economy has “decoupled” from the other Big Three economies: China, Germany and Japan, and that has a couple of important implications for market-world, I think.

Bad News Is Good News

By Ben Hunt | August 31, 2023

Last week I wrote that the Big Idea (unmoored long-end of rates curve) had been discovered, which always means that the counter-Narrative isn’t far behind.

That counter-narrative is Bad News Is Good News TM.

Reason #7 for Unmoored Rates

By Ben Hunt | August 24, 2023

Just in the past week, a new viral thread in Narrative-world to support the ‘unmoored long-dated rates’ trade.

One Good Idea

By Ben Hunt | August 15, 2023

We’re reconfiguring the entire ET Pro service to support our Big Idea for 2023: long-dated interest rates are coming unmoored, meaning that 10-year+ Treasury yields and mortgage rates are poised not only to go significantly higher, but to do so in a sharp, punctuated and painful fashion.

That’s My Story and I’m Sticking To It

By Ben Hunt | July 20, 2023

Well, it’s been about three weeks since my “feel it in my bones” email describing why I think the next investable (+/- 7% or so) move in equity markets is down rather than up.

I still think that’s the case.

A Feeling In My Bones

By Ben Hunt | June 29, 2023

There is a constructed ebullience in the US economy right now, by which I mean that the usual Narrative wall of worry that Wall Street uses to grind higher has totally vanished.

And that ALWAYS ends in tears.

What Are We Even Doing?

By Ben Hunt | June 9, 2023

Over the past 14 years, Quality, Value and Skill have been useless in professional asset management.

They used to work. They don’t work any longer. But we all act as if they work.

What are we even doing?

A Man’s Got To Know His Limitations

By Ben Hunt | May 9, 2023

I feel like Clint Eastwood has said the line “a man’s got to know his limitations” or something similar in every movie he’s ever appeared in, and we’ve got to know the limitations of our Narrative Monitors, too.

The Exponential Boom

By Ben Hunt | April 27, 2023

It’s an interesting period of time in the world of professional investing right now, where everyone is going through the old motions and observing the proper forms and using the words and language we’ve been using for decades, but somehow their hearts aren’t really into it.

New Notes, New Signals, Same Markets

By Ben Hunt | April 12, 2023

This week we’ve got a new big note on AI, a new set of Narrative Monitors with several new signals triggered, and two new articles from the past week that bear directly on recent Pro notes. All that and I think markets are largely unchanged from their grind upwards post-banking ‘crisis’ and post-inflation/unemployment ‘events’!

Are We Having Fun Yet?

By Ben Hunt | March 28, 2023

Assuming that Treasury and the Fed have stopped the immediate, fast-motion bank run at First Republic and created a reasonable firewall (and I think they probably have), what’s the impact of this credit freeze on the overall economy? Is this a polar vortex credit freeze that throws us into a nasty recession, or just a mild cold snap?

The Phone Call Is Coming From Inside The House

By Ben Hunt | March 15, 2023

Last week I wrote that my spidey-sense was not tingling when it came to systemic risk for the banking system, that I just didn’t see the pervasive rot that would create a real worry about the stability of the *system*.

Today my spidey-sense is tingling like crazy.

Book Value

By Ben Hunt | March 10, 2023

Over the past week we’ve had one bank fail (Silvergate) and another forced to raise new equity and start protesting-too-much about how there’s no slow-motion run on the bank (Silicon Valley Bank). The question, of course, is whether these two banks are canaries in the coal mine.

Has systemic risk returned to the banking system?

ODTE Is the New Black

By Ben Hunt | February 24, 2023

ODTE stands for zero days to expiry, and it’s the catch-all phrase for options that expire the same day they are written.

ODTEs are all the rage, prompting questions on Wall Street like “are ODTEs the tail that wags the market dog?” and “are ODTEs a ticking time bomb for markets?”.

My answer: yes, kinda, but not in the way you think.

Spidey Sense

By Ben Hunt | February 12, 2023

I’m 58 years old, and this is the greatest level of direct military confrontation between the world’s superpowers in my adult lifetime.

Narrative Stability, Hanging by a Thread

By Ben Hunt | February 8, 2023

“Narrative Stability, Hanging by a Thread” is a badly mixed metaphor, but it conveys exactly what we’re seeing in Narrative-world these days.

We are in a market where we are one inflation shock or one jobs shock (like the one last Friday) from broadly reshaping the narrative landscape. But for now it’s steady as she goes.

Narrative Monitors

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