“I invest exactly opposite of that.”
-Bill Ackman
For those of you who still have the #discipline & deliberate study to keep track of some big things like history, cycles, etc., that quote from my boy, Bill Ackman, came from his 2015 “charity event” interview of Ray Dalio.
“The founder of Pershing Square had long found Dalio’s public pronouncements of an opaque, quantitative (macro) investment style to be generic and even nonsensical…” -The Fund, pg 234
Fast forward to 2023, and Bill is the new Bond King @CNBC … making pronouncements about pending Fed rate cuts! LOL
Back to the Global Macro Grind…
I’m old enough to remember when Bill was making “calls” to short US Treasury Bonds (this year) on inflation, deficits, and debt levels. Newsflash: all of those fundamental realities have stuck with America.
But … rapidly rising Bond Yields were ripping Bill’s Long Only Concentrated Stock Portfolio… so he had to go the other way on that!
Back to Bill (to Ray) in 2015: “Let’s say you were to buy one stock, or one market… where would you put your money?”
A: “I don’t do that.” -Ray
-The Fund, pg 234
LOL x2.
I’m laughing out loud because we’ve reached a level of noise in Macro Tourism that is hysterical at this point. Billy is VERY good at pushing his book on CNBC. So trying to push the Fed to cut rates so that his stocks stay up is just classic.
You see, Bill, like many other Hedge Fund Managers who failed at Short Selling, consistently, for alpha… has long since given up on things like hedging and simply decided to be just like a Retail Investor (Long Only Concentrated Stock Picks).
That’s great for Billy and Willy and everyone who wants to “BUY STAHKS”, but it won’t change economic gravity.
And, before you have friends who go there, I am long of plenty of things right now that will go vertical if A) we are in the RECESSION we’ve been nowcasting for 1H of 2024 and B) the Fed Cuts:
- Gold (GLD)
- Physical Gold (AAAU)
- Short-term Treasuries (SHY)
- Long-term Treasuries (BNDD)
- Mortgage-Backed Securities (MTBA)
- Uranium (URA, URNM, NLR)
- Bitcoin (BITO)
- Ethereum (ETHE)
- MLPs (AMLP)
- US Mega Cap (XLG)
Oh, these Mucker Haters didn’t know I was long all of that stuff in my super cool Long Only Family Office account?
Our Institutional, Macro Pro, and new Portfolio Solutions subscribers can see those positions and another 16 Asset Allocations for a total of 26 currently.
So… I’ll be selling-SOME of pretty much ALL of that on green today:
A) Because I “do that” on green… and
B) Because Bond Yields are going to be right at the LOW-end of my Risk Range™ Signals
So thanks, Bill. I appreciate that you now appreciate Ray, and making “public pronouncements" on Macro!
For those of you who want a non-funny-Macro-Tourist break-down of what’s really happening post this “Big Bond Market Consolidation Signal” (title of yesterday’s Early Look), read that. Bill isn’t driving the Bond Market bus.
What’s next?
Well maybe CNBC can get another bureaucrat named Waller to get on Old Wall TV today and say the same thing (this is what he said yesterday): “if inflation goes down to our 2% target, we can think about cutting interest rates.”
But…
A) INFLATION isn’t going to 2% anytime soon … and
B) Next week’s US Jobs report should see a sequential ACCELERATION!
As a reminder (read yesterday’s note), we have headline INFLATION (CPI) between 3.22-3.29% for the 1H (1st half) of 2024. And we have what we call a MONTHLY #Quad2 of pending US economic data here for the month of NOVEMBER.
That’s right. Since the US Employment Data was HIGHLY impacted (negatively) by the UAW Strikes in OCT, re-accelerating labor data in NOV (just for a month, not the next 6 months) is what non-Macro-Tourists will be playing for from here.
Again, from the LOW-end of my Risk Range™ Signals, things have a high probability of bouncing. That includes Bond Yields, on my TRADE duration. Don’t ask Bond King Bill for a signal on that. He can’t trade like we do either.
Immediate-term Risk Range™ Signal with @Hedgeye TREND signal in brackets
UST 30yr Yield 4.46-4.71% (bearish)
UST 10yr Yield 4.28-4.58% (bearish)
UST 2yr Yield 4.66-4.99% (bearish)
High Yield (HYG) 74.11-75.66 (bearish)
SPX 4 (bearish)
NASDAQ 13,807-14,357 (bullish)
RUT 1 (bearish)
Tech (XLK) 181-186 (bullish)
Energy (XLE) 83.21-85.66 (bearish)
Utilities (XLU) 61.02-63.32 (bullish)
Shanghai Comp 3005-3067 (bearish)
BSE Sensex (India) 65,206-66,499 (bullish)
VIX 12.46-16.06 (neutral)
USD 102.57-104.70 (neutral)
EUR/USD 1.079-1.101 (neutral)
USD/YEN 146.82-150.69 (neutral)
Oil (Brent) 77.75-83.68 (bearish)
Nat Gas 2.68-3.11 (bearish)
Gold 1 (bullish)
Silver 22.95-25.51 (bullish)
MSFT 367-385 (bullish)
AMZN 143-149 (bullish)
META 330-345 (bullish)
GOOGL 134-139 (bullish)
Bitcoin 36,321-38,967 (bullish)
Best of luck out there today,
KM
Keith R. McCullough
Chief Executive Officer
