Goldman's Tom "FX Scourge" Stolper Resumes Legendary Muppet Slaying

Tyler Durden's picture

Greg Smith's 15 minutes of fame has come and gone, but the muppet crushing at Goldman is only starting to ramp up, courtesy of the man who singlehandedly has made sure Goldman's FX prop trading team should be the most profitable one in the entire universe by simply doing the opposite of what Goldman's clients do. As a reminder, sent out at 5 pm yesterday, as we alerted our Twitter followers: "Go long EUR/CAD on further risk premium compression in the EUR and a more dovish BoC... We recommend going long EUR/CAD at a current level of 1.296 with an initial target of 1.37 and a stop on a London close below 1.26." Big Oops (see chart). Then again, after Stolper epic failure to Impala the muppets on his last EURUSD trade reco, it is great to see him back to 0.000 batting form.


Full note:

Trade Update : Go long EUR/CAD on further risk premium compression in the EUR and a more dovish BoC

With the weekend’s Spanish regional elections out of the way, it is our expectation that Spain will apply for an EFSF/ESM program in the coming weeks. Once conditionality has been negotiated and the MoU signed, this will set the stage for the ECB’s OMT to go active, which could lead to further compression in the Euro zone risk premium. We traded compression in this risk premium with our long EUR/$ trade in August and September. We therefore see this long EUR recommendation in many ways as the second leg of that trade.

We recommend going long EUR/CAD for two reasons. First, the exact timing of the Spanish application remains uncertain (though this is a “when” and not an “if”). By going long EUR/CAD as opposed to long EUR/$ we are allowing for some uncertainty around when exactly Spain applies for a program. Second, and more importantly, we think the Bank of Canada will tomorrow drop its tightening bias, which was foreshadowed in Governor Carney’s speech last week in which he gave more neutral forward guidance. We think in conjunction with that change, the Bank of Canada will downgrade both its growth and inflation forecasts, for which there is ample room based on recent data. Given significant long CAD speculative positioning – our sentiment index in our weekly IMM email remains close to stretched long levels – we think there is room on the FX side for the market to price this shift.

We recommend going long EUR/CAD at a current level of 1.296 with an initial target of 1.37 and a stop on a London close below 1.26.

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slaughterer's picture

Muppets richtig gestolpert!

Richard Chesler's picture

It's shocking this fucker doesn't have his own CNBC show yet.

Eireann go Brach's picture

The Squid continues to piss all over their clients! Yet they keep coming back for more!

NotApplicable's picture

Clients =

OPM Managers =

Captured Funds with a Mandate =

Nobody Ever Got Fired for Hiring GS =

Squid Feast

Jlmadyson's picture

Yea sounding real dovish this morning alright.

Perpetual Burn's picture

"Our salespeople, traders, and other professionals may provide oral or written market commentary or trading strategies to our clients and our proprietary trading desks that reflect opinions that are contrary to the opinions reflected in this research. Our asset management area, our proprietary trading desks and investing businesses may make investment decisions that are inconsistent with the recommendations or views expressed in this research."


-Goldman Sachs

Nobody For President's picture

Thanks for that one, had me in stitches. Big mess of greenies for you!

MillionDollarBogus_'s picture

Goldman Sachs Group Business Principles :

"1. Our clients' interests always come first. Our experience shows that if we serve our clients well, our own success will follow.

2. Our assets are our people, capital and reputation. If any of these is ever diminished, the last is the most difficult to restore. We are dedicated to complying fully with the letter and spirit of the laws, rules and ethical principles that govern us. Our continued success depends upon unswerving adherence to this standard."

Based on all that, it would appear Greg Smith has it all

Nobody For President's picture

...if we serve our clients well, ...


Baked, roasted, par-boiled, or fried?

mendigo's picture

stolper really inspires tyler - great stuff

one day this may not go as planned

that will be a very good day

GFORCE's picture

Must have Carney on speed dial. C**ts!

dannyboy's picture

Thanks for this one tyler! :D I put this trade on 10mins after u posted.. as always anon donate when I unwind :)

soopy's picture

Everybody knows you never go full Stolper.