Excellent piece. We are in similar camps I've been adding this week to my favored inverse etf short as well. I remember not long ago that a point of contention at a presser was how far they were from positive real rates across the curve. It appears they have now achieved it. how do you believe this effect their outlook? https://blinks.bloomberg.com/news/stories/RGGSJRT0G1KW
A couple of weeks ago you made a call to buy TLT, which I did. It rallied nicely for about 10 days but is down practically to buy entry price. What happened and are you still bullish on TLT (TO THE MOON)? I really enjoy your material and Macro Trading show.
Absolutely love your content and authenticity Alf.
What I’m wondering about the most is :
Is the current extreme rally (in size and breadth) the soft-landing narrative or is it the gravity of the enourmous long only passive slice of the market ? (And is the soft-landing story just the media’s way of grasping at straws, but irrelevant).
The flaw I do see in my own argument is that this insanly sized market shoud be well...passive...no? So if they are not (able to) leveraging, its only new flows that would matter and my first thought might be misguided. Unless this huge slice of the market does get de- and releveraged somehow I dont understand yet.
The macro backdrop is so negative, and although volumes have been low during the rally, I certainly cant comprehend what dynamics can drive market into such a dislocation. It makes me wonder if that same driving force can somehow keep markets pumping up (and keep the narrative alive) for the next 6-9 months until inflation might actually be down significantly. A mild or semi serious recession should still hit the bottom 80% of Americans hard, but perhaps stock markets can get another (undeserved) pass.
Thanks again for all your knowledge, transparency and commitment.
A podcast or article on some of your best & worst trades at ING along with lessons learned etc. Would be very informative and I'm sure help a lot of people with risk management.
Appreciate the article. What's your take on TLT, EDV? Would you start now investing in long bond etfs or wait for 10 year to hit higher level? If you prefer to wait, what would be your method to determine entry point ?
I have been fading this rally. I thought I was losing my mind until I read your most recent update. I appreciate how you support your thesis with lots of relevant data.
Alf, great information as always. I can't thank you enough. I know everyone's risk tolerance is different but I'm curious as to the allocation size. Your etf portfolio has low beta, some tech, bonds with sizable cash. Can you divulge what you might consider a fair allocation for someone risk averse? Thanks again. David C
I'm with you. I thought we'd roll over, based on the charts, but it looks like the casino is back. Well, like I heard you say once... three times in investing and for me, it's time to go fishing! See you in Wyoming on the Green!
One Elephant in the room seems to be housing. Do you have a Macro view on US housing costs? etc.," If rates go lower it would seem that the huge pent up demand apparently in existence would be a boon for housing stocks. They have rallied with the rest, but what about the countervailing force of a slowing economy and possible layoffs etc.? Thanks ALF I saw you first on RV. Your English as a second language is truly remarkable.
All experts I listen to are telling more or less the same. Earnings decline, TLT long, this isn't over yet and so on. You, Steno, Snyder, Belkin and all the other guys with a shitload of knowledge and experience. All by far smarter than I am. But it would be really interesting to see when they are all wrong.
I don't wish it, because then I am wrong either. Just thinking about it.
I would like to present a trade to you which I am currently in, and perhaps you can tell me I am an idiot.
My thesis is that although I agree with your macro view, I hear that there is a lag between rate hikes and their effects on the economy. I have heard estimates of about 9 months or more before the economy is really affected, which is soon, but perhaps only beginning.
I have also heard that many hedge fund managers have "gone fishing" as you say and may not be as active for the month of August.
My thinking is that this leaves "dumb money" in charge for the time being. Dumb money which doesn't look further into the CPI data, or the jobs data as you present here and on boiler room.
The "merge" for Ethereum is the biggest narrative behind the crypto space at the moment, and I have been waiting for the "merge" trade since 5 years ago, in 2017. Crypto is also extremely narrative driven, and if you can find the narrative, you can find a rally (unless macro news is pulling the rug out from under you).
The "merge" date is sept 15-16.
My trade is to long Ethereum until the end of august, and get out. I am in the trade since a couple weeks ago and do not intend to ride to the very top, but to capture the meat of the move. I am 30 percent in of my entire NW.
I am curious, some time ago you wrote you have a long term portfolio which accounts for 90% of your savings. (= 70 % MSCI world EUR hedged, 20 % USD Treasuries, 8% Gold, 2 % BTC) In this portfolio you invest regularly regardless of the market condition. 10 % of your savings are you tactical portfolio.
Is this long term portfolio still the same? Or why are you writing now in this article that your long-term ETF portfolio has a large position on USD Cash, Low exposure to risk-assets and Higher than usual exposure to 10y+ Government Bonds;
Shouldn't it be the case that the long term portfolios are hardly changed instead of tactical portfolios?
Excellent piece. We are in similar camps I've been adding this week to my favored inverse etf short as well. I remember not long ago that a point of contention at a presser was how far they were from positive real rates across the curve. It appears they have now achieved it. how do you believe this effect their outlook? https://blinks.bloomberg.com/news/stories/RGGSJRT0G1KW
So will Monday's post include the asset allocation %ages for the LT ETF and Tactical Portfolios you reference?
Eager to learn more on why fixed income as one of the best risk-adjusted asset classes for the near term.
A couple of weeks ago you made a call to buy TLT, which I did. It rallied nicely for about 10 days but is down practically to buy entry price. What happened and are you still bullish on TLT (TO THE MOON)? I really enjoy your material and Macro Trading show.
Chris
Absolutely love your content and authenticity Alf.
What I’m wondering about the most is :
Is the current extreme rally (in size and breadth) the soft-landing narrative or is it the gravity of the enourmous long only passive slice of the market ? (And is the soft-landing story just the media’s way of grasping at straws, but irrelevant).
The flaw I do see in my own argument is that this insanly sized market shoud be well...passive...no? So if they are not (able to) leveraging, its only new flows that would matter and my first thought might be misguided. Unless this huge slice of the market does get de- and releveraged somehow I dont understand yet.
The macro backdrop is so negative, and although volumes have been low during the rally, I certainly cant comprehend what dynamics can drive market into such a dislocation. It makes me wonder if that same driving force can somehow keep markets pumping up (and keep the narrative alive) for the next 6-9 months until inflation might actually be down significantly. A mild or semi serious recession should still hit the bottom 80% of Americans hard, but perhaps stock markets can get another (undeserved) pass.
Thanks again for all your knowledge, transparency and commitment.
A podcast or article on some of your best & worst trades at ING along with lessons learned etc. Would be very informative and I'm sure help a lot of people with risk management.
Thanks Alf. I was wondering if you were still short and now we know. The big question, was 3639 the bottom? Sure feels like it. Thank you.
Appreciate the article. What's your take on TLT, EDV? Would you start now investing in long bond etfs or wait for 10 year to hit higher level? If you prefer to wait, what would be your method to determine entry point ?
I have been fading this rally. I thought I was losing my mind until I read your most recent update. I appreciate how you support your thesis with lots of relevant data.
Thank you for creating audio option!!!
Alf, great information as always. I can't thank you enough. I know everyone's risk tolerance is different but I'm curious as to the allocation size. Your etf portfolio has low beta, some tech, bonds with sizable cash. Can you divulge what you might consider a fair allocation for someone risk averse? Thanks again. David C
I'm with you. I thought we'd roll over, based on the charts, but it looks like the casino is back. Well, like I heard you say once... three times in investing and for me, it's time to go fishing! See you in Wyoming on the Green!
One Elephant in the room seems to be housing. Do you have a Macro view on US housing costs? etc.," If rates go lower it would seem that the huge pent up demand apparently in existence would be a boon for housing stocks. They have rallied with the rest, but what about the countervailing force of a slowing economy and possible layoffs etc.? Thanks ALF I saw you first on RV. Your English as a second language is truly remarkable.
Wow---- outstanding AND a very succinct macroperspective! Thanks for ALL your hard work--- --- ---
All experts I listen to are telling more or less the same. Earnings decline, TLT long, this isn't over yet and so on. You, Steno, Snyder, Belkin and all the other guys with a shitload of knowledge and experience. All by far smarter than I am. But it would be really interesting to see when they are all wrong.
I don't wish it, because then I am wrong either. Just thinking about it.
Love your content Alf, you are a great teacher!
I would like to present a trade to you which I am currently in, and perhaps you can tell me I am an idiot.
My thesis is that although I agree with your macro view, I hear that there is a lag between rate hikes and their effects on the economy. I have heard estimates of about 9 months or more before the economy is really affected, which is soon, but perhaps only beginning.
I have also heard that many hedge fund managers have "gone fishing" as you say and may not be as active for the month of August.
My thinking is that this leaves "dumb money" in charge for the time being. Dumb money which doesn't look further into the CPI data, or the jobs data as you present here and on boiler room.
The "merge" for Ethereum is the biggest narrative behind the crypto space at the moment, and I have been waiting for the "merge" trade since 5 years ago, in 2017. Crypto is also extremely narrative driven, and if you can find the narrative, you can find a rally (unless macro news is pulling the rug out from under you).
The "merge" date is sept 15-16.
My trade is to long Ethereum until the end of august, and get out. I am in the trade since a couple weeks ago and do not intend to ride to the very top, but to capture the meat of the move. I am 30 percent in of my entire NW.
Am I an idiot?
Thanks Alf for the article!
I am curious, some time ago you wrote you have a long term portfolio which accounts for 90% of your savings. (= 70 % MSCI world EUR hedged, 20 % USD Treasuries, 8% Gold, 2 % BTC) In this portfolio you invest regularly regardless of the market condition. 10 % of your savings are you tactical portfolio.
Is this long term portfolio still the same? Or why are you writing now in this article that your long-term ETF portfolio has a large position on USD Cash, Low exposure to risk-assets and Higher than usual exposure to 10y+ Government Bonds;
Shouldn't it be the case that the long term portfolios are hardly changed instead of tactical portfolios?
Thank you Alf!