Business

Some Sunday thoughts from the CIO of One River Asset Management, whose latest Weekend Notes starts off in traditional Eric Peters style, namely a mockery of the Fed...

“Wait, that’s not even part of your model?” asked the private sector, imagining itself in the presence of the Fed.

 

“You seriously don’t even consider the crushing weight of the pension avalanche that is bearing down on us?” And the governors shrugged.

 

Authored by Peter Tchir via Brean Capital,

VIX ETFs and ETNs

We take a deeper dive into the strange world of VIX ETFs and ETNs.  We take a quick look at the incredible short interest in both the long VIX products and the short VIX products.  This massive short interest in both long and short products seems unique to the VIX world (it reflects a re-balancing trading strategy that works in the VIX space because of the high volatility of the VIX products) (VIX ETFs seem to run 5 to 10 times the realized volatility of the S&P 500).

Dr. Pippa Malmgren, a US policy analyst and former member of the Working Group on Financial Markets, a government entity better known by its nickname, the “Plunge Protection Team,” appeared on Erik Townsend’s MacroVoices podcast to discuss bitcoin and the European refugee crisis, while also offering some clues about how the PPT, famous for its secrecy, operates.

On The Financial Implications of Europe's Refugee Crisis

Having previously exposed the greatest trick the market has pulled on Biotech investors in the past - What Is The PE Of The iShares Biotech ETF? It Depends On Whether You Read The Fine Print -  it appears investors need another lesson in reality versus perception.

As Horizon Kinetics puts it so eloquently - It’s One Thing to Not Know, It’s Another to Be Told What Isn’t So

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The current Fed rate raising cycle began on December 15, 2015. And while we all hear the wild claims about what will “obviously” be the different market reactions to the rate increase, let’s stick to the facts. The knee-jerk reaction to an interest rate increase is to sell gold. According to the consensus, rising rates = falling gold prices. But that theory is total crap.