Author Topic: 1999 again?  (Read 18972 times)

RuleNumberOne

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Re: 1999 again?
« Reply #160 on: August 08, 2019, 09:56:27 AM »
Bloomberg is doing great journalism, unlike the FT that has become the mouthpiece of Eurocrats.

The bubble in the bond market is much bigger than 1999 because the sums involved are far bigger, by orders of magnitude.


This Might Be the Bond Market’s Dot-Com Moment
https://www.bloomberg.com/opinion/articles/2019-08-08/this-might-be-the-bond-market-s-dot-com-moment?srnd=premium

In today’s bond market, it seems as if no price is too high.
https://www.bloomberg.com/news/articles/2019-08-07/the-furious-global-bond-market-rally-shows-few-signs-of-abating

The ECB Is Dragging Us Deeper Into Madness
https://www.bloomberg.com/opinion/articles/2019-08-08/ecb-is-dragging-the-bond-market-deeper-into-yield-curve-madness?srnd=premium

« Last Edit: August 08, 2019, 09:59:56 AM by RuleNumberOne »


gokou3

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Re: 1999 again?
« Reply #161 on: August 08, 2019, 12:23:39 PM »
Quote
Another catalyst later in the year might yet involve Trump, just as in 2016. If China and the U.S. can fashion a trade peace, and convince the markets that they mean it, a lot of people will find themselves on the wrong side of the trade.

In such an environment, it would obviously be a very bad idea to hold bonds. Stocks might benefit at least initially from the sentiment that a total slowdown could be averted. But if there is something to buy for now, to protect against these eventualities, maybe it might be a bet on faster inflation through the bond market. It can, after all, be done very cheaply. And if this does indeed prove to have been the moment of revulsion, it would pay off.

What would be a good instrument for placing such a bet as a retail investor?  I remember around 2010 Soros or his proteges made a similar bet on interest rate increases using some derivative instruments, but I forgot what it was and I wouldn't be able to access such instruments anyways.

Castanza

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Re: 1999 again?
« Reply #162 on: August 08, 2019, 12:55:06 PM »
Quote
Another catalyst later in the year might yet involve Trump, just as in 2016. If China and the U.S. can fashion a trade peace, and convince the markets that they mean it, a lot of people will find themselves on the wrong side of the trade.

In such an environment, it would obviously be a very bad idea to hold bonds. Stocks might benefit at least initially from the sentiment that a total slowdown could be averted. But if there is something to buy for now, to protect against these eventualities, maybe it might be a bet on faster inflation through the bond market. It can, after all, be done very cheaply. And if this does indeed prove to have been the moment of revulsion, it would pay off.

What would be a good instrument for placing such a bet as a retail investor?  I remember around 2010 Soros or his proteges made a similar bet on interest rate increases using some derivative instruments, but I forgot what it was and I wouldn't be able to access such instruments anyways.

Maybe not a perfect answer to your question but Eurodollar futures could be a decent play with the current ECB climate.

SHDL

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Re: 1999 again?
« Reply #163 on: August 08, 2019, 09:30:19 PM »
Quote
Another catalyst later in the year might yet involve Trump, just as in 2016. If China and the U.S. can fashion a trade peace, and convince the markets that they mean it, a lot of people will find themselves on the wrong side of the trade.

In such an environment, it would obviously be a very bad idea to hold bonds. Stocks might benefit at least initially from the sentiment that a total slowdown could be averted. But if there is something to buy for now, to protect against these eventualities, maybe it might be a bet on faster inflation through the bond market. It can, after all, be done very cheaply. And if this does indeed prove to have been the moment of revulsion, it would pay off.

What would be a good instrument for placing such a bet as a retail investor?  I remember around 2010 Soros or his proteges made a similar bet on interest rate increases using some derivative instruments, but I forgot what it was and I wouldn't be able to access such instruments anyways.

TIPS are probably the most obvious candidate. I would focus on individual bonds that mature within a year or two.  If you have the inclination you can probably even isolate the inflation protection component by simultaneously shorting a (non-inflation protected) Treasury note that matures on the same day.

CorpRaider

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Re: 1999 again?
« Reply #164 on: August 09, 2019, 12:13:37 PM »
What would be a good instrument for placing such a bet as a retail investor?  I remember around 2010 Soros or his proteges made a similar bet on interest rate increases using some derivative instruments, but I forgot what it was and I wouldn't be able to access such instruments anyways.

U said retail so:  Series I Treasury bonds have a .50% real return through November (I think).  You can buy $10K per annum ($10K per soc # for a married couple).  Get the real return rate + a floating inflation indexed rate.  Usually better tax treatment (and some other advantages) than TIPS, but obviously limited by size. 
« Last Edit: August 09, 2019, 05:52:29 PM by CorpRaider »

gokou3

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Re: 1999 again?
« Reply #165 on: August 09, 2019, 12:26:08 PM »
Quote
Another catalyst later in the year might yet involve Trump, just as in 2016. If China and the U.S. can fashion a trade peace, and convince the markets that they mean it, a lot of people will find themselves on the wrong side of the trade.

In such an environment, it would obviously be a very bad idea to hold bonds. Stocks might benefit at least initially from the sentiment that a total slowdown could be averted. But if there is something to buy for now, to protect against these eventualities, maybe it might be a bet on faster inflation through the bond market. It can, after all, be done very cheaply. And if this does indeed prove to have been the moment of revulsion, it would pay off.

What would be a good instrument for placing such a bet as a retail investor?  I remember around 2010 Soros or his proteges made a similar bet on interest rate increases using some derivative instruments, but I forgot what it was and I wouldn't be able to access such instruments anyways.

Maybe not a perfect answer to your question but Eurodollar futures could be a decent play with the current ECB climate.

Thanks, this seems to be a good instrument for a highly-leveraged bet... and with options, the downside is limited.

https://www.cmegroup.com/trading/interest-rates/stir/eurodollar_quotes_globex.html?optionProductId=4&optionExpiration=4-Q9




Spekulatius

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Re: 1999 again?
« Reply #166 on: August 09, 2019, 04:12:59 PM »
Just present facts without any judgment. You researched this individual online and found out these violations. I wouldn’t even call him a swindler (which is a judgement) and you don’t know the terms of the annuity , so I wouldn’t even comment on that. Then if the customer is interested, offer further help to investigate or look at the annuity contract. It‘s then up to the customer to take action and work with you or somebody else.

That’s what I would do, but then again, I am not an investment advisor.
To be a realist, one has to believe in miracles.