Unanchored

Brent Donnelly is a senior risk-taker and FX market maker, and has been trading foreign exchange sin
You have reached the maximum number of free, long-form articles for the month.

Please join here to read the rest of this content.

Paid Members can log in here.

To learn more about Epsilon Theory and be notified when we release new content sign up here. You’ll receive an email every week and your information will never be shared with anyone else.

Comments

  1. Very interesting and thought provoking piece.
    Now most of the changes occurred when the Fed and other Central Banks went ultra-loose monetary policies ( or at least when the majority of market participants recognized it and thought it permanent)

    What happens when say “Inflation is Here” and must be dealt with?
    What happens when the CBs get out of the money printing business and have to maintain an honest to goodness Cost of Capital in order to arrest Inflation?

    I humbly submit that the “snip” is a function of what John Hussman has described as “Deranged Monetary Policy “
    A policy that can’t be extended forever
    And hopefully won’t

  2. Avatar for yffras yffras says:

    Great article!

    This crypto, meme stock, NFT, tokenized world is this generations Dot Com bubble. Except it’s fueled by infinite leverage and zero regulation. We all know there’s massive fraud in these types of systems. Humans cannot by their nature self-regulate.

    These new asset classes will see a crushing pullback over 90%. Who knows what the stock markets will do.

    And when will this crash come? Who knows? Are we there yet? Do we have 200% more to go?

    Those who trade this with discipline will get out alive and wealthy. Most will lose it all.

  3. Avatar for bhunt bhunt says:

    Speaking of unanchored, European junk bonds had a negative real yield last week. That’s … ummm … never happened before and should be … impossible?

  4. Another “too big to fail” opportunity… Common knowledge is we will never have another default cycle. Until today and seeing Evergrand make it to the front pages, sure feels like even the Europeans could kick the can a long way down the road.

  5. Avatar for glarri glarri says:

    What does ‘OG’ mean in OG NFTs mentioned in the footnote? Thanks.

    Great post. It really highlights how the game is changing radically in ways that are easy to miss.

    My grandmother had a portfolio of stocks listed on the stock market. I have a portfolio of stocks listed on the stock market. All of the terminology is the same, but the game is completely different.

  6. Sorry slow reply ! It means Original Gangster… i.e., the most old school and highly-respected.

Continue the discussion at the Epsilon Theory Forum

Participants

The Latest From Epsilon Theory

DISCLOSURES

This commentary is being provided to you as general information only and should not be taken as investment advice. The opinions expressed in these materials represent the personal views of the author(s). It is not investment research or a research recommendation, as it does not constitute substantive research or analysis. Any action that you take as a result of information contained in this document is ultimately your responsibility. Epsilon Theory will not accept liability for any loss or damage, including without limitation to any loss of profit, which may arise directly or indirectly from use of or reliance on such information. Consult your investment advisor before making any investment decisions. It must be noted, that no one can accurately predict the future of the market with certainty or guarantee future investment performance. Past performance is not a guarantee of future results.

Statements in this communication are forward-looking statements. The forward-looking statements and other views expressed herein are as of the date of this publication. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and there is no guarantee that any predictions will come to pass. The views expressed herein are subject to change at any time, due to numerous market and other factors. Epsilon Theory disclaims any obligation to update publicly or revise any forward-looking statements or views expressed herein. This information is neither an offer to sell nor a solicitation of any offer to buy any securities. This commentary has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Epsilon Theory recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a financial advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives.