prev

CHART OF THE DAY: More Evidence Of Investors Losing Faith In Central Planners

Editor's Note: Below is a brief excerpt and chart from today's Early Look written by Hedgeye U.S. Macro analyst Christian Drake. Click here to learn more.

 

"... As the Chart of the Day below illustrates, with swap rates, inflation expectations and growth estimates falling, currencies appreciating and European and Asian equities still in crash mode off their respective highs in the face of the latest quantitative and qualitative easing announcements, investors are believing that conditions are as bad as policy makers suggest but are in increasing disbelief of their ability to do anything about it."

 

CHART OF THE DAY: More Evidence Of Investors Losing Faith In Central Planners - CoD inflation Expectations


Cartoon of the Day: The Central Bank Of Neverland

Cartoon of the Day: The Central Bank Of Neverland - Draghi Peter Pan cartoon 04.13.2016

 

Central planners are increasingly pushing on a string as macro markets continue to move in direct opposition to the best efforts of policymakers at the ECB and BOJ.


LinkedIn: ‘Proceed With Caution’ | $LNKD

 

Hedgeye Internet & Media analyst Hesham Shaaban removed LinkedIn from his Best Ideas Long list heading into fourth quarter earnings. Good call. The stock is down 50% year-to-date. In this brief excerpt from The Macro Show earlier today, Shaaban responds to a subscriber’s question about whether LinkedIn is now “too cheap to ignore” and gives a deep dive explanation as to why he’s cautious on the stock.


real-time alerts

real edge in real-time

This indispensable trading tool is based on a risk management signaling process Hedgeye CEO Keith McCullough developed during his years as a hedge fund manager and continues to refine. Nearly every trading day, you’ll receive Keith’s latest signals - buy, sell, short or cover.

About Everything | When Less Is More

 

In this complimentary edition of About Everything, Hedgeye Demography Sector Head Neil Howe discusses why "we’re entering a new era in which simplicity — not choice — is the hallmark of a cutting-edge brand." 

 

Click here to read Howe's accompanying About Everything research note.


A Look At Yellen's (Nonsensical) Claim That Fed Is "Focused On Main Street"

A Look At Yellen's (Nonsensical) Claim That Fed Is "Focused On Main Street" - Yellen cartoon 03.31.2016

 

In case you missed it... 

 

In an exclusive interview with Time magazine, Fed head Janet Yellen said:

 

"We are focused on Main Street, on supporting economic conditions—plentiful jobs and stable prices—that help all Americans."

 

We've been arguing that Fed policies have, in fact, perpetuated the exact opposite of Yellen's stated goal for some time now. In the charts below, via Hedgeye Senior Macro analyst Darius Dale, you can clearly see the massive build in asset prices that Fed helped create. This swelling of financial assets flowed predominantly to the balance sheets of the wealthy. Not Main Street.

 

 

As Darius Dale wrote earlier today:

 

"This grand central planning experiment where we've made literal market-moving rock stars out of government bureaucrats will definitely come to an end." 

 

More on that...

 

Yellen & Co. have this nonsensical line of thinking that the Fed "did not make a mistake" with its December rate hike, a pause in April rate hikes was warranted because the Fed is "willing to be cautious" about poor economic data but that, ultimately, the economy is doing "quite well" so further Fed rate hikes is one of the world's "worst-kept" secrets.

 

Huh?

 

Well, data-dependent Fed, what does the data say?

 

 

Here are a few charts via Hedgeye Senior Macro analyst Darius Dale of recent data releases. Notice the clear-cut declines across these data sets (Retail sales, PPI, and NFIB Business Survey):

 

Click the images below to enlarge: 

 

A Look At Yellen's (Nonsensical) Claim That Fed Is "Focused On Main Street" - darius retail sales

 

A Look At Yellen's (Nonsensical) Claim That Fed Is "Focused On Main Street" - darius ppi

 

A Look At Yellen's (Nonsensical) Claim That Fed Is "Focused On Main Street" - darius nfib


INSTANT INSIGHT | What's Really Driving Oil Prices

INSTANT INSIGHT | What's Really Driving Oil Prices - oil fallen and can t get up

 

Following yesterday's 4.5% pop in the price of oil on OPEC production freeze speculation, we're back to fundamentals this morning (a.k.a. stronger U.S. dollar pushing prices lower).

 

So where do we go from here? Below is analysis from Hedgeye CEO Keith McCullough in a note sent to subscribers earlier this morning:

 

"Another fun ramp to an immediate-term overbought signal (on an oversold USD signal) finds resistance, USD bounces, and Oil sells off -1.7% this am; OVX (oil volatility) is signaling nowhere near the end of this bear market in Oil (OVX = 48 with an immediate-term risk range of 44-53)"

 

In a recent Early Look, McCullough noted that Commodities (CRB Index) have an inverse correlation (30-day duration) of -0.88 vs. the US Dollar. That's what's driving commodity prices and oil today. 

 

If you are trying to read the OPEC tea leaves, however, watch our Hedgeye colleague and Potomac Research Group's Senior Energy analyst Joe McMonigle in the video below. 

 

 

Today, Saudi Arabia's Oil Minister downplayed the prospect of oil producers taking action saying "Forget about this topic." Furthermore, Iranian oil minister Bijan Zanganeh announced that he does not even plan to attend the Doha meeting.

 

Sound familiar?

 

McMonigle has been arguing for a while now that speculation about an OPEC oil production freeze is just talk, since Saudia Arabia and Iran's true intentions are what really matter. Here are links to other videos and research notes via McMonigle:


the macro show

what smart investors watch to win

Hosted by Hedgeye CEO Keith McCullough at 9:00am ET, this special online broadcast offers smart investors and traders of all stripes the sharpest insights and clearest market analysis available on Wall Street.

next