While most financial professionals would enjoy nothing more than to trade bitcoin all day long - after all it only goes up in the long run (for now), while bringing insane volatility with it - the reality for most is that they are confined to such boring, established legacy instruments as Treasurys, which rarely have intraday fireworks similar to those in bitcoin.
Over the weekend we warned that just as everyone was convinced that the yield curve can only flatten from here, and was positioned massively on the long side of the 30Y future, the opposite was about to happen, and in a tweet highlighting the record net spec long positioning in 30Y futures, we said "here comes the mega steepener."
Here comes the mega steepener pic.twitter.com/OHqmX4HzMA
— zerohedge (@zerohedge) December 17, 2017
Authored by Kevin Muir via The Macro Tourist blog,
Moody's estimates that there is roughly $1.4 trillion dollars belonging to U.S. corporations that has been building up in foreign bank accounts for years now to avoid the 35% corporate tax that would be levied on them if they were brought back to the U.S. Of course, getting that $1.4 trillion back to the U.S. has been a critical component of the Trump administration's tax reform bill as Gary Cohn and Steve Mnuchin have repeatedly argued that the money would be put to good use building factories and creating jobs for American workers.
As stocks do things they have never done before (in terms of gains and complacency), despite the "inexplicable" collapse in the yield curve (and slump in earnigs expectations), some, like former fund manager Richard Breslow, are growing frustrated with the farce.
2017 is on track to be the first 'perfect year' with 12 consecutive monthly total return gains for the S&P 500
But the yield curve is collapsing?
And so have earnings expectations...