WM 6 May 2023

Quotes

Marechal Foch who led the allied armies during WWI knew a few things about human nature and human heart. He foresaw the unassailable return of war yet failed to conceive how technology would change the nature of war.

Lessons & Thoughts

Information is the resolution of uncertainty. What matters is the answer but the questions. Question: how many questions do you need to ask to find out what letter of the alphabet he/she picked out of the 27? Square root of 27 = 5.2.

Cortisol is a killer when not kept under control

Signs of our time

Fact and perception
Example causes of death

Technical analysis

50D MAV

Checklists

Take profits

Five questions

Macro news

Money

Salaries & taxes & cost of living

GDP

CPI

Yield curve

Why is the dollar falling? Interest rates rising but economy slowing and breaking. Market anticipates rapid fall of rates and end of tightening cycle. Fiscal policy challenged by debt ceiling. In brief: tightening monetary + fiscal profligacy was bullish for dollar

Precious metals

Crypto

Fixed income

Debt ceiling debate now putting US default date on 1 June

US regional banks losses

Interest rates (base rates)

Cause I am TLT, I am dynamite, TLT...

Real estate

Equities

Moment of truth

Bubble bursting?

Or continuation of a secular bull market

Bearish wedge

Valuation overextended

And earnings under pressure

Breadth indicators

Advance/decline

Volatility

Commodities

Copper

incentives at USD 8500/tonne

Surging sugar

Themes, Sectors & Corporate news

Big vs small caps

Sharpe

Theme: if buybacks/globalisation are dead and unemployment low then theme is productivity/automation/infrastructure/energy etc

Money flows and megacaps: too much of a good thing

Banking crisis unfolding in front of our eyes and yet the market does not panic