Due to Unforeseen Circumstances

Thursday, July 01, 2010

Right, folks, before we start, as an answer to the market mosquitoes constantly buzzing around with their high pitched whines of dark-battle-death-star-galacticas on the SPX charts, encouraging us to mortgage the kids to load the boat of shorts, we do recommend "Star-No-More" or " Death-Star-Off" - whose active component can be seen on this post on "The Big Picture". It would appear that the active ingredient in dark crosses is at best homeopathic.

Well, it's half time in the game of 2010 and it's probably time to sit down, suck half an orange, take a breather and a pep-talk/berating from the coach. So how are we doing against game plan? Well, so far it's the bookies who seem to be the winners, as favourites are dropping like flies this year. Yesterday Federer went out at Wimbledon to a shock defeat by little-known {inset little-known name here}. The day before Venus Williams went out to little-known {inset little-known name here}. The World Cup saw Italy and France out early to shock defeats by little-known {inset little-known names here}. The only pattern to have emerged in sportsland is that the {inset little-known name here} normally ends in "-ich" or "-ic" or is composed of a team load of "-iches". Has all that Swiss franc financing in Eastern Europe found its way into sports facilities?

In the world of finance the favourites have done just as poorly. There are few of last December's "trades du l'annee" still standing either. Back in Dec 2009 the 2010 game plans were being drawn up against a world of devaluing dollar due to its printing presses, recovering economies and the EU air fresheners were still shrouding the stink from the t&rd buckets of Europe and the double dippers were still hiding in their caves. But if you were to now score the top bank 2010 recommendations you were sent, we would have a friendly that the bookie has won again.

Remember such classics as short USD, long Chinese equities, short JGBs, short USTs, long CEE/JPY, in fact short JPY vs everything. All have been taken out by "Unforeseen Circumstances". Poor old BP have even lost 100000000000 - 0 to an "unforeseen circumstance". At this rate it seems like the Mayan predictions of 700 yrs ago are having a better run than the rest of us. And on that basis we bet it won't be long before some of those daft fund-consultants come up with "Based on relative fund performances, we suggest you invest in Mayan Investment Management who have outperformed their peers and are short everything with duration beyond 2012" !

Now you might be tempted to imagine this is just Team Macro Man trying to hide their bounce call of Monday amongst the catalogue of disastrous calls this year, along the classic market psychology lines of "My profit, our loss". It isn't. We are just a bit bored sitting here, sucking our oranges, waiting for the second half to kick off. Not sure how it will pan out but the teams returning to the pitch have definitely swapped ends.

Posted by Polemic at 1:34 PM  

5 comments:

'ere... 'oo you calling a market mosquito..? (Grinning broadly).

The Death Cross didn't fail to predict the onset of major bear episodes in the Nikkei in the 90s. That's my best analog for what we are going through and it hasn't failed me yet.

FWIW LB lost a few fingers this week too, the joys of counter-trend trading and ill-timed hedging... due to unforeseen circumstances, as you say.

A few "short Treasury" Flation Funds selling gold today b/c they are about to detonate...? Is Morgan Stanley's fixed income trading (5.5% 10y forecast) in deep deep trouble? With gold and TIPS both down today, shades of 2008?

Leftback said...
4:36 PM  

Ha ha, MS fixed income tools may have been hit by "unforeseen circumstances" as well, but they want to double down on their big bet on growth and they want to ride that steepener some more.

Even if it brings down the firm? Hubris Unlimited is officially out of control. Get the knife out, Mack.

MS Bends Over In Front of the Steamroller

If you recall, Macro Man polled on this topic "in this space" about the time 2s10s approached 300 bps.

Leftback said...
10:24 PM  

And I was pink flamingoed by the short EUR/USD pain squeeze (the only blue number of the screen :)) ... sigh, I gave away a lot(!) on that one.

Oh yes, what happended to Bullion today ... it cratered!

Fingers!? More like a hand here ;)

Good thing I am going on holiday tomorrow; that will do my P/L good I hope.

Claus

CV said...
10:37 PM  

Why don't you call for a steward inquiry, there seems to be three teams playing now,nah, don't worry about, I just looooove those swissy blondes.

FX said...
5:24 AM  

The damage caused in eur/usd was nothing to do with a Pink Flamingo .. It's the Killer Bunny .. remember?

Richard said...
1:52 PM  

Post a Comment

Blogger templates