In August of 2014, amid tapering QE and talk of normalization, speculators in the world's most liquid money-market instruments went all-in with record bearish bets on eurodollar futures. They were wrong and the short-squeeze sparked a slow-motion flash-crash in bond yields (10Y from 2.65% to 1.86% in a month).
Today, as we await words, smoke, and mirrors from Janet tomorrow, the world's speculators are even more all-in...
Hedge-fund managers and other large speculators have a record net-short wager on Eurodollar futures, whose prices fall when money-market rates rise, according to Commodity Futures Trading Commission data as of Dec. 6.
To be clear that is a $2.24 Trillion notional bet that this time is different, that The Fed does what it says, and that interest rates will normalize higher from here because everything is fixed now.