Ten Things I'm Thankful For

The last couple of weeks have really refocused attention on how fortunate most of us are to live in relative peace and harmony in our daily lives.  With that in mind, this seems an apt time for Macro Man to give thanks that:

1) The Macro family is in fine fettle.  Mrs. Macro is healthy, as lovely as ever, and still willing to put up with Macro Man.  Macro Boy the Elder has grown from a boy into a fine young man in the space of about six months, while Macro Boy the Younger is smart as a whip with a wicked sense of humour.

2) Macro Man himself is in the proverbial "best shape of his life."  Of course, cycling an average of nearly ninety minutes a day, every single day of the year, will do that for you.

3) Mrs. Macro backed off from her midyear insistence that Macro Man cycle less!

4) In a tough environment for just about everyone, Macro Man still has friends in the market who are looking out for him and willing to lend a hand wherever possible.

5) He was able to finagle another Bloomberg trial over the last couple of months.  It's really been re-invigorating to be properly plugged back in to the data.  Sadly, barring quasi-divine intervention, it's coming to an end in a few days, so it will be back to relying on mates for data and some charts.

6) He's not levered long high yield and distressed debt.   Those guys have had a rough go of it recently, and with more and more issues trading distressed, next year isn't looking any easier.   Then again, those guys don't have to give back the ludicrous money they "earned" for winning the Turdbuyer of the Year Award from 2010-13.



7)  2016 is finally shaping up as a year of divergence, macro imbalances, and, dare we hope, a return of the thinking man's investment style.

8) Having caught up on two decades of sleep deprivation this year, Macro Man doesn't have to worry about losing any wondering if he'll spend his bonus on the Maserati or the Aston.

9) Despite the occasional moan in this space,  his mind still feels fit and sharp and creative.   Having the time to read a shedload of books hasn't hurt.

10) This space continues to roll along, with a solid cadre of dedicated readers and a community of commenters that generally keep it lively and interesting without going too far overboard.

Thanks for reading, happy Thanksgiving, and good luck for the rest of the year!
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November 26, 2015 at 7:40 AM ×

thanks Mr. Macro Man, same to you. I have Bloomberg so in case you need anything from there, let me know.

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Anonymous
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November 26, 2015 at 7:59 AM ×

Wash and repeat Henner's comment re BBG data. It is a pleasure to read this blog so if I can give something back than happy to help. Re the point on books, what is on your list? I have read Drobny's books on your recommendation on this blog (and recently mentioned in this wk's comments) which is the finest thing I've read and makes me want to stay in markets. DM

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Anonymous
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November 26, 2015 at 8:03 AM ×

I am thankful that this blog exists as it provides a sane discussion of markets. Such places are far and few on the net.

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Celeriac1972
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November 26, 2015 at 8:25 AM ×

Long sleep / short workplace stress is working for me too. Post Maratone I haven't done enough cycling. A loss as the saddle is a great place from which to conduct gedanken experiments. I must restore my cycling mojo, although the Surrey Hills don't exercise the same draw as the Dolomites...

Thank you for the insights you bring and the discourse you promote here. I remain fascinated.

Keep it up!

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nichoman
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November 26, 2015 at 8:50 AM ×

Good stuff ! Happy to help with a BB chart...

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Quarrel
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November 26, 2015 at 8:50 AM ×

MM,

thanks for your blog for all these years, and happy thanksgiving to you & yours.

I've been reading you since 2006 (and your "off" years coincided with busy work times for me), and have learnt a *LOT* from your blog.

In particular, I can't thank you enough for posting actual trades and your P&L for the open/closed trades in those first years. It taught me so much about how I should think about macro trading in a way no one else around had. Lots of people post thoughts "Euro is oversold here", but translating that to what the right action is, and constructing a portfolio of open trades as transparently as you did was a huge help to novice me.

So, well, thanks!


--Q

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CV
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November 26, 2015 at 9:42 AM ×

Have a good one MM! Great to hear the family is in good form. Nothing more important than that!

Macro will be back soon enough, and spending the bonus on a Maserati or Aston is soo yesterday anyway. I hear they're buying Bentleys and Lambos now ... go figure ;).

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amplitudeinthehouse
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November 26, 2015 at 9:47 AM ×

Yes, Macro Man, it seems appropriate at the moment to reflect on the realities going on in the world apart from watching charts. What a shit fight their got over there.
Anyway , Macro man , if your venturing into downtown Manhattan behind Mrs Macro's back this year to do some shopping for thanksgiving be sure to bag amps when breaking the ice with the local traders , I hear bagging amps at the moment is likely to induce to swapping of stories about the first time you watched "The last tango in Paris" with your partner and what color residual of that experience carry through into the next..
Anyway, it's not about us...may Macro Man live forever!

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Anonymous
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November 26, 2015 at 9:54 AM ×

EU equities up +2% yesterday, another +1% today (basically up +800 points in the last 8 days). No one else long on this? Have been mentioning it for several days now...

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November 26, 2015 at 10:16 AM ×

Let me know if you need any Bloomberg chats - happy to help, i'm on EU time zone.

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Anonymous
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November 26, 2015 at 11:33 AM ×

Many thanks macro man, happy thanksgiving!
Anon 9.24... i too am long , but you are ruining any sense of satisfaction i could have with your pointless burps, to the point it's making me nervous to be similarly positioned... are you going to comment (if that qualify as a comment at all) any up moves with variations of 'qe forever, CBs printing, market up, told ya' ? come on man, go p*ssed people off on ZH pls...

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Anonymous
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November 26, 2015 at 11:50 AM ×

Also thanks MM, and I second the comment on the open trades stuff in the early days.
50% is the idea, 50% is the implementation.
Internetz/press/research is stuffed with time-wasting ideas and a small minority of gems, but the dearth of info on the latter is an obvious tell.
Sympathise with the general macro-frustrations as well, seems fund investors care more about process and systems, and old or prop school macro just doesn't seem to cut it (both on perf and demand). Not much to say except correls and regimes change, and I think the structural change in the markets time periods mean that medium term is out.
Enjoy Thanksgiving.
JL

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AI
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November 26, 2015 at 12:26 PM ×

Disappointed to see that "we've got Payet" didn't make the top 10!

Enjoy thanksgiving.

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Cityhunter
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November 26, 2015 at 12:45 PM ×

Thank you MM, happy Thanksgiving!

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abee crombie
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November 26, 2015 at 1:10 PM ×

Thanks for being one of the few places I can go to without having a salesperson remind me that I am not a client and therefore can't ask a question. Thanks for sharing the wisdom, bc if you can't teach it, perhaps you don't really know what you are doing. I've learned a lot here.

Looking back 2015 was a pretty good macro year. Huge moves in fx, commodities, em, high yield, Europe and Japan. All mostly macro. Too bad the core of many macro traders, rates have been pretty boring all year. If 2016 is better, it's gonna be pretty wild.

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Anonymous
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November 26, 2015 at 2:01 PM ×

I am thankful for Central Bank QE that means one can make massive returns by going long equities on every pull-back, month-after-month. It may sound facetious and ZH and plenty others will tell me that this must end, but by then I will be retired (seriously).
Happy Thanksgiving.

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Leftback
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November 26, 2015 at 2:59 PM ×

Happy Holidays to all, especially the Family Macro and the larger family of regular commenters herein.

LB is working today, on a writing project, as the Annual Turkey shoot has little emotional valence for a Scouser. LB will break off from work this afternoon to take a walk down Bleecker Street and watch the Reds in the match against Bordeaux.

Despite the apparent recent co-localization of "amplitudeinthehouse" and "Leftback" in downtown Manhattan, LB wishes to state that Amps is NOT the same person as LB, not even LB on an exclusive diet of hallucinogenic mushrooms...

Abee, interesting comment about "boring rates". That has generally been the area of my most successful and profitable punts of 2015, but they have been few and far between, in truth. CV figured out early that the Hammock was the place to be in 2015, and so it proved, as "hammocking" has outperformed "punting" handsomely [except for our superstar "JBTFDers"].

Right now the positioning and sentiment of traders in rates reminds LB very much of Spring 2010, when he may have been briefly the only person on the planet who was long the Long Bond (and profited from it). Indeed, one's "Spidey Sense" indicates that another big squeeze might be on the horizon. We will, I suspect, return to the topic in the ensuing weeks. History suggests that the time to go Big is the day when LB Abuse re: Rates on the blog reaches its maximal crescendo.

Now stop reading this tosh and get back to stuffing that attractive bird.....

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Anonymous
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November 26, 2015 at 3:30 PM ×

Agree LB, my 2c - dovish hiking cycle = solid belly/long end.
JL

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Anonymous
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November 26, 2015 at 6:13 PM ×

The list of books recommended by the Macro Man will be valuable

happy Thanksgiving

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Anonymous
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November 26, 2015 at 10:32 PM ×

Thanks for the blog and great comments. So far this year I only have a series of small victories and no big prize. We still have a month to go in 2015 so I am still hopeful to catch some big fish. Thanks MM and many insightful comments here and it is intellectually simulating to read this blog evry morning.

Back to the markets. A few thoughts on PBOC and BOJ. I always felt that PBOC and BOJ would ease again by the end of this year. But now I had my doubt. If it is purely based on economics, then both CBs should have eased already. The only thing prevented them from doing so right now is politics. Japan maight want to withhold any move that depreciates its currency until the US passes the TPP. For China, it is about SDR at IMF. PBOC must want to be seen as a responsible player before RMB is officially added as a part of SDR.

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AL
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November 26, 2015 at 10:40 PM ×

Happy Thanksgiving MM,
despite 2015 being a tough, tough year on both personal and professional front, I am grateful too of many important things that I am privileged to have in my life.
Among those, I thank you for sharing your thoughts and insight in the markets and for being my very first read in the morning when I sit in the office.

And as Xmas is approaching and wishes are one of the few things I am bullish for, I was thinking ..... how about doing our own Global Macro Fund? A fund which is Global not only in its investment objective, but also in the way it is managed by its portfolio managers which do not sit in the same place, but are all over the world.

I am sure that if we put together all our contacts and skills we might even have a decent shot to start with a very respectable amount of seed money.

So, if you guys are still sitting on your chair and not lying on the floor laughing, we should probably get in touch and have a chat about it.

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Anonymous
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November 27, 2015 at 5:17 AM ×

So a Team Macro Man fund ?

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Anonymous
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November 27, 2015 at 10:38 AM ×

Re: Team Macro Man Fund

I nominate Nico as Portfolio Manager & FunnyMoney as Head Trader.
Should make for a few amusing 7 a.m. morning meetings ;-)

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November 27, 2015 at 10:38 AM ×

@AL, this idea has been rounding on my head since a lot of time...

more brainstorming than feasible however...

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November 27, 2015 at 10:56 AM ×

@MM... points 2 has been a good results also for my year... i've again some problem with point 3!! how did you solve it??? :)

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Anonymous
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November 27, 2015 at 5:32 PM ×

Haha with live broadcasting of morning meeting and a team of Macro Man, Nico, Funny Money.. there's another crazy also I am forgetting now... lets come up with a name.. Big 'Macro' Shore?

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Booger
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November 27, 2015 at 7:41 PM ×

MM, thanks for a great site. With work, relevancy, mid-life crisis, it is something probably anyone with self-reflection and over 40 struggles with. Things are always greener on the other side and it is good to have appreciation for what we have. For my part, no way I would want to be working for any company and going to endless meetings and reporting to layers of managers. The ideal is to be working for a small, growing outfit but they are far and few between and you are just lucky to find a good one when you start out in any field.

To be good in investing, you have to be drooping with too much time on your hands and time to contemplate. Attending to good self care, health exercise is important and having time to spend with family more important than most things. By those standards, you sound like you have succeeded ! Trading can be isolated though so maybe counteract that by going to a few conferences.

I regret most the Christmas concerts and other things I've missed for the kids from the hours I've been doing the last 2 years. It is mainly choices I guess and every one has negatives and positives. The rest is perhaps balance, getting through the tough periods and periods of self-doubt. Unfortunately, trading your own book doesn't have the same social proof and validation as say being a manager but then there is also much less BS !

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Booger
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November 27, 2015 at 8:05 PM ×

The sell the news idea a variable time after the Draghi announcement is very interesting. I am waiting for a reversal signal in euro over the next 2 weeks and have been contemplating the best way to play that. Long eur.aud looks compelling as it:
1. takes advantage of near record eur.usd short interest developing (again)and the potentially explosive short covering rally that may ensue
2. also has benefit of benefiting from aud weakness if the recent strong employment report does not persist. There is a distinct chance the next employment report will disappoint and the rba will reverse course on being neutral. There is also the tailwind of anything China related if it blows up e.g Yuan depreciation. I am surprised there has not been more reaction to the recent capex numbers, which were terrible. Sure they bounce around a bit but the trend and recent number probably almost reverses the effect of the stronger than expected employment numbers for the RBA I would think. After a bubblish year, house prices appear to have also reached a plateau in Melbourne and Sydney, the largest cities if one uses auction clearance rates as a proxy. One suspects the recent strength in aud employment has been related to the housing boom and if that is plateauing and commodities are still cratering, that is aud bearish.

I still like short aud.cad.

usd.cnh continues to gradually creep up day after day, except for the occasional 5 mins every week when it dumps with some obvious CB intervention. It must be pressuring the Chinese...

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Leftback
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November 28, 2015 at 12:44 AM ×

How about another Sunday night surprise from China?

LB bought a few SPY puts into the close today. How many times have we seen the Black Friday rumors bought in the post-turkey session only for Monday to bring the cold reality of the mediocre US recovery to light? Post-Thanksgiving Monday, traders return after several days away and the reaction is often to Sell The News.

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Booger
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November 28, 2015 at 1:23 PM ×

LB: short spoos does look interesting at current levels. Might nibble again.

With China surprise, the SDR decision day is next Monday. One wonders how they will play it if they were going to devalue. I suspect they would leave it until after Monday and getting SDR and after Draghi's speech on Euro QEII. Under cover from the Europeans would be a good place to do the devaluation. The chaos may increase chances of the Fed hiking being delayed again.

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November 28, 2015 at 3:24 PM ×

The cycling every day is very impressive. Congrats on the accomplishment as well as all the other positives you have to be thankful for!

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Anonymous
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November 29, 2015 at 7:48 AM ×

http://www.telegraph.co.uk/finance/12001370/Greek-crisis-China-crash-and-low-rates-hedge-funds-horror-year.html

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Anonymous
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November 29, 2015 at 5:40 PM ×

http://www.barrons.com/articles/the-yuan-guessing-game-1448691524

"Seizing upon the fact that the yuan has drifted steadily lower against the dollar, Bank of America Merrill Lynch’s currency strategist David Woo thinks the Chinese central bank is now seeking a “great divorce” from the Federal Reserve. He argues that the PBOC will let the yuan slide all the way to seven in a year, starting soon after the Fed’s first interest-rate hike, probably on Dec. 16."

"Merrill does not believe that China is engaged in a beggar-thy-neighbor competitive devaluation game. Rather, Chinese corporations have piled on too much debt—over 120% of China’s gross domestic product—due to hot money flowing into the country since quantitative easing began in the U.S. “Real interest rates are too high,” says Woo, and China has to cut its rates aggressively to keep its companies afloat. In return, the PBOC has to let go of the yuan. For 2016, Merrill called “long dollar, short yuan” its favorite currency trade."

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Anonymous
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November 30, 2015 at 1:05 AM ×

Time to sell NZD and AUD ?

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Nico G
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November 30, 2015 at 3:48 AM ×

i was going to be thankful for tons of stuff - for Macro posts (being the great advocate of the "return of the thinking man's investment style" after too many years of POMO distortion), for global warming and good health, for being married to a bisexual pearl who could extract the most amazing kid from my nearly expired saggy balls, and for still having one or two friends left despite being odiously abrupt, patience and diplomacy-impaired

then i learned today that i had to work with funny money at Team BigMac'ro. The news felt like being hit by a 800 pound turkey. So time to go back to sullen and withdrawn to a 'short lived' market after a short lived holiday of overcooked meat (can anyone cook a turkey al dente in the US?) and fantastically abondant black mail (mostly black Friday stuff) that make you feel special and elected.

i do appreciate the new business cards, though

(even if Team Macrobe would sound impressive in french)

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Nico G
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November 30, 2015 at 6:22 AM ×

> a glimmer of hope

“I think people in banking are paid too much. Many people in the sector still believe they should be paid entrepreneurial wages for turning up to work with a regular salary, a pension and probably a health-care scheme and playing with other people’s money. There doesn’t seem to be anything entrepreneurial about that except the compensation structures.”

Deutsche Bank co-CEO John Cryan

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