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"Gaussian Demolition": Observations On Key Global Events

Tyler Durden's picture




 

By Guy Haselmann of ScotiaBank

Gaussian Demolition

Bell Curves have become fatter and flatter. They may even be inverted. The term “bell curve” comes from the shape of the curve that depicts all occurrences distributed around the most-probable event. Data points in the ‘tails’ are now more frequent. Hyper-active central banks might be ensuring both a melt-up bubble and a market crash: larger ‘right-tail’ and ‘left-tail’ outcomes.

Many of the central banks’ actions have been motivated by their price-stability mandate. Due to the perception that they are failing on this mandate, several have resorted to extreme policy experimentation. However, mechanically responding to drops in inflation gauges can have dangerous long-run effects, especially if central banks are miscalculating inflation and underestimating the consequences of radical policy.

In this light, central bank success has to be a function of their accurate understanding of pricing pressures. This could be where central banks’ lurch into experimental policies breaks down. Stable and declining inflation has largely been the result of growing innovation, modernization, globalization, and productivity. Central banks could be fighting the wrong kind of price pressures and their tools may actually fuel, rather than counteract, those factors (due to how the proceeds of debt issuance are used).

Furthermore, recent drops in inflation indices have been the result of falling commodity prices which are typically only ‘transitory’ (as Yellen stated). They are ‘transitory’ because year-over-year numbers will add back to inflation 12 months after prices stabilize. By worrying consumers so publically about their concerns over deflation, central banks are doing exactly what they say they are trying to prevent: embedding a deflationary psyche into the behavior of consumers. It is feasible that central banks will take credit for next year’s rise in inflation in an attempt to re-establish credibility after prior year failures.

Extreme policies - that have diminishing benefits over time - may have now become counter-productive as consumers are coerced into worrying about these over-hyped developments. Therefore, global central banks may have embraced an inappropriate amount of fear mongering about deflation. Moreover, low or negative rate policies also encourage higher debt. Both issues have consequences that will have to be dealt with over time.

Negative interest rate policies in many countries show the drastic extent of just how far central banks are willing to go. Many people are perplexed that interest rates can go negative. It is hard to imagine that someone will pay to lend money. During the gold standard when the US dollar and gold were fully-convertible, those who preferred to hold gold received a negative interest rate due to storage costs. The same concept must now be applied to fiat money, where some are willing to pay to have their money stored.

In addition, some (non-mandated) investors will invest at negative yields if they expect deflation to give them a positive real yield. Currency levels are also having an impact on central bank actions. Some central banks might be cutting rates so their currencies do not strengthen against others who are cutting rates. It is for this reason that most central banks were forced to cut so low in the first place. In other words, when the Fed cut to zero, others had to follow suit or risk being left behind from ‘too strong’ a currency.

Policy makers have entered a treacherous environment where the value of the currency has become a weapon (currency wars). The fact is that in a highly interconnected and globalized world, central banks’ independence is limited. When one central bank moves, it puts pressure on some others to move.

There have already been seventeen central bank cuts so far in 2015. A few European central banks might be trying to pre-empt March’s ECB QE. The Danish central bank has cut rates 4 times in the past three weeks. Yesterday, the Swedish Riksbank dropped their deposit and repo rates below zero. In turn, the Swedish Kroner has now become a key funding currency for renewed risk-seeking carry trades.

QE and negative interest rate policies incentivize investors to chase (ever) lower-yielding and higher-risk assets. Asset price inflation is the purposeful intent. However, the risk/reward profile changes as prices rise. This is not a problem until:

  1. the marginal buyer becomes exhausted;
  2. the (CB) policies that have underwritten the ‘right-tail’ try to reverse course, unleashing the ‘left-tail’, or;
  3. investors revolt at the bad risk profile and boycott high-priced risky assets (i.e., a market that collapses under its own weight).

In the meantime, investors’ not incentivized or forced to participate will simply hoard cash. Pillow case deposits look better than bank deposits. Moreover, the opportunity cost of holding cash is exceptionally low due to negative or low rates and modest inflation. Cash can also be deployed opportunistically, so it has high levels of optionality. However, cash holders will be subjected to FOMU risk (Fear of Missing the Upside).

Should the public begin to hoard cash, it is difficult to envision how a central bank can achieve its mandate. Would that mean that the central bank will have to print ever-larger amounts of money merely to offset the hoarding?

* * *

FED

It is unlikely that the Fed would ever push rates negative due to the importance of the Money Market Mutual Fund industry in this country. In the unlikely event that it happens, gold would begin to shine. On the contrary, I expect the Fed to hike rates soon (no later than the April meeting). This can help end the madness of other central banks’ ‘race to the bottom’. As the holder of the world’s reserve currency, the Fed needs to be the first major central bank to hike.

The recent ‘risk-on’ euphoria should encourage an earlier hike from the FOMC. With so many easing moves recently and the launch of the ECB QE in March, the Fed might feel those actions will help reduce the potential of a negative market reaction. After 6 years of enormous accommodation, the Fed has been worried about disrupting the apple cart of ever-higher asset prices. Hiking rates while other central banks are easing can be a form of “Great Aunt Addy Policy”, i.e., using the brake and accelerator simultaneously (August 4, 2014 note).

The timing for a hike is quite good. GDP has accelerated, inflation has been stable, payrolls have improved and the unemployment rate is down to 5.7%. Equity markets are near all-time highs (bubblish?), credit spreads are tight, market interest rates are low, and oil is giving the consumer a boost.

The upward pressure on the US dollar from a hike would have some modest negative effects on the profitability of large multi-national corporations, but there would be worthwhile and offsetting benefits to Europe who is trying to depreciate its currency.

Another reason for the Fed to hike is that the US Treasury curve has bear steepened in the last two weeks. Many believe that the Fed likes a steep curve because that is supportive to banking NIMs, but the current environment is different. Today, the Fed is more concerned about maintaining support to the housing industry. Therefore, the Fed would like to see front rates rise, but back end rates stay low. The best way to achieve this result would be to hike sooner than the market is expecting.

Lastly, the Fed’s 2012 Operation Twist extended the maturities of their SOMA holdings. The first of these mature in early 2016. The Fed will have to hike rakes well in advance of the $200 billion in securities that mature in 2016. An April hike would give them greater flexibility to space out further rate hikes in 2015.

* * *

West Coast Ports

On a separate issue, the biggest wild card for the Fed and the US economy is how the west coast dock workers lock-out plays out. 29 Ports from Seattle to San Diego are currently shut down for four days. The ports handle over $1 trillion of goods annually. The Pacific Maritime Association who operate the ports took punitive actions to shut the ports in retaliation for the dockworkers who in recent days had slowed their efforts – essential getting paid for not really doing their job.

While 20,000 workers are directly impacted, it is estimated that over 30 million workers are indirectly affected. These ports are critically important to the US economy and will cost billions each day that they are closed. It appears that they will re-open on Tuesday, but it is unclear how cooperative the workers will be until the wage dispute issue is resolved.

Some have already called for Obama to invoke his authority under the Taft-Hartley Act to force the ports to stay open, but his ideology is such that he will not want to look like he is siding with the employer at the expense of a union or employee. A prolonged port problem could push the US into a short recession. It is far too early to worry about it and it is unlikely to be a prolonged problem, but its critical importance deserves attention.

* * *

Greece

The situation in Greece is significant and far from being resolved. The Germans tell me that they do not even know what Greece wants because their demands are so incoherent. The interest rate paid on existing debt is at rock bottom levels (0% with the ECB) so that isn’t the issue. Debt forgiveness is not an option. New money will not be granted, simply because Greece is viewed as a Kleptocracy. Austerity relief will be difficult to concede since Tsipras would do the opposite by hiring back unproductive public workers and re-instituting pension benefits. All outcomes and solutions discussed so far look problematic. I believe there is a 50/50 probability between an agreement that allows the EU to muddle along a while longer (possibly the preferred outcome for all involved), and a market-disruptive Greek exit (and default).

* * *

“Tied to the tracks and the train’s fast coming / Strapped to the wing with the engine running / You say that this wasn’t in your plan / and don’t mess around with the demolition man.” - Sting

 

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Sat, 02/14/2015 - 10:49 | 5784144 wallstreetapost...
wallstreetaposteriori's picture

standard normal distribution mean 0 standard deviation 1

Sat, 02/14/2015 - 10:50 | 5784146 cossack55
cossack55's picture

Maybe......but it does not give him the right to call Mr. Yellen "Great Aunt Addy".

Sat, 02/14/2015 - 10:51 | 5784150 negative rates
negative rates's picture

Stay tuned, your luck is about to drop out of that thing.

Sat, 02/14/2015 - 11:25 | 5784218 MarketAnarchist
MarketAnarchist's picture

"Stable and declining inflation has largely been the result of growing innovation, modernization, globalization, and productivity."

The author is wrong.   It is not inflation that is declining, it is simply prices.   When supply and demand change (or producers become more efficient etc.) that is simply a cost change, and it has NOTHING to do with inflation.

The correct, AUSTRIAN definition is a change in the number of currency units.   When all other things are constant, increasing the number of currency units will increase cost. THAT is inflation.  

Sat, 02/14/2015 - 12:53 | 5784360 Redneck Hippy
Redneck Hippy's picture

When all other things are constant...  When has that ever happened?

Sat, 02/14/2015 - 17:04 | 5784947 MarketAnarchist
MarketAnarchist's picture

It doesn't. It is just a way of demonstrating that price fluctuation can be the result of both inflation and supply/demand.  The two pricing mechanisms are simultaneous.

Sat, 02/14/2015 - 15:17 | 5784672 explosivo
explosivo's picture

Agreed. This is just bad economics.

Sat, 02/14/2015 - 11:28 | 5784221 Stuck on Zero
Stuck on Zero's picture

I love this part: 

"GDP has accelerated, inflation has been stable, payrolls have improved and the unemployment rate is down to 5.7%"

What planet is this?

Sat, 02/14/2015 - 12:12 | 5784295 Winston Churchill
Winston Churchill's picture

 The planet Krug, beyond Uranus.

Sat, 02/14/2015 - 18:08 | 5785088 winchester
winchester's picture

uranus or myanus ? or ouranus ?

Sat, 02/14/2015 - 11:12 | 5784198 Fun Facts
Fun Facts's picture

Aunt Addy is burning up the clutch.

Sat, 02/14/2015 - 12:03 | 5784277 williambanzai7
williambanzai7's picture

Sat, 02/14/2015 - 12:23 | 5784322 Skateboarder
Skateboarder's picture

Surgical outliers, as opposed to statistical ones. ;-)

Sat, 02/14/2015 - 12:37 | 5784341 cornfritter
cornfritter's picture

can those things feed 4B bipeds?  a bit of a stretch i fear, hopefully she has a bunch of sisters

Sat, 02/14/2015 - 12:59 | 5784365 Leveraged Algorithm
Leveraged Algorithm's picture

Must be Yellen's daughter.....her inflation lessons from mama at home

Sat, 02/14/2015 - 10:52 | 5784151 q99x2
q99x2's picture

I'm convinced that I'm not convinced that Greece is not ever going to default or not.

I am convinced though that financial warfare and the ability to use FRAUD against nations goes to zero once all central banks begin printing or QE or giving out loans for free and so on.

Once the power of FRAUD reaches its limits reality sets in. We're close.

Sat, 02/14/2015 - 11:32 | 5784234 indygo55
indygo55's picture

How about the denial statement in the article of: "unemployment rate is down to 5.7%.. Anyone that believes that statement is full of shit and has lost credibility in my view.


Sat, 02/14/2015 - 12:30 | 5784332 Skateboarder
Skateboarder's picture

I heard the same stuff on the radio the other day, ending with: "things are picking up"... right...

Perhaps questions will arise when there is 0% unemployment (in the included labor participants), yet everyone is unemployed (because they are not in the included labor participants). That won't happen until the last big retailer eats shit though.

Sat, 02/14/2015 - 12:55 | 5784362 Redneck Hippy
Redneck Hippy's picture

Fraud is only limited by the creativity of the fraudsters.  It gets worse from here.

Sat, 02/14/2015 - 10:53 | 5784157 cossack55
cossack55's picture

dockworkers who in recent days had slowed their efforts-essentially getting paid for not doing their jobs.

I did'nt realize dock workers were gubmint employees.

Sat, 02/14/2015 - 10:59 | 5784163 Creepy A. Cracker
Creepy A. Cracker's picture

There are a whole lot of Dear Leader Obama's amnesty illegal aliens waiting for those manual labor "jobs Americans won't do."  Send a few buses to the Home Depot parking lots and the ports will be fully functional in no time at substantially lower costs to operate.  The Dear Leader Obama economy at its best...

Sat, 02/14/2015 - 11:04 | 5784176 Son of Loki
Son of Loki's picture

Guvnor Brown's Super-Rail from the border up the coast can make stops at each port to disgorge aliens willing to work for 50% less.

Make each port area an "Illegal Alien Safe Zone" like in LA.

Sat, 02/14/2015 - 10:56 | 5784164 cornfritter
cornfritter's picture

all your employees are belongs to us

 

honkie :-)

Sat, 02/14/2015 - 11:08 | 5784187 RaceToTheBottom
RaceToTheBottom's picture

Give them a ribbon.

Sat, 02/14/2015 - 11:32 | 5784162 Creepy A. Cracker
Creepy A. Cracker's picture

We are ALL above average...

 

Average.

Middle.

Half above, half below.

 

Never mind...

Sat, 02/14/2015 - 10:58 | 5784168 Dasa Slooofoot
Dasa Slooofoot's picture

Kurtosis fo' a nigga

Sat, 02/14/2015 - 11:00 | 5784171 Son of Loki
Son of Loki's picture

"a short recession?"

 

Mian Street Middle Class is still in the depression of 2008.

Sat, 02/14/2015 - 13:01 | 5784375 disabledvet
disabledvet's picture

And "outliers" in the form of market behavior are normative.

Sat, 02/14/2015 - 11:01 | 5784172 Feel it Reel it
Feel it Reel it's picture

I need some help understanding this guys...Can someone please explain how QE, bailouts etc continue? I don't get it... Can we and other Nations print money to infinity? It certainly seems so...It doesn't appear that Government debt matters at any level for any Nation...It appears the charade can go on indefinitely with no consequences....

Sat, 02/14/2015 - 11:12 | 5784196 kowalli
kowalli's picture

You will have same amount of money, but you can buy less and less.

QE is a double helix of inflation and deflation which drains the purchasing power of people and  transfers capital to already rich people

It will stop working soon because people will not have money to buy food and it is already here.

Sat, 02/14/2015 - 11:13 | 5784199 cornfritter
cornfritter's picture

"It appears the charade can go on indefinitely with no consequences."

 

maybe, but not typically... some might argue that we are at the end of a economic long wave, specifically the "harvest" phase, where the courtiers are allowed to loot the system.  Then, typically, a government is left unable to meet it's promised social obligations and some type of event (often war) reduces the headcount so said obligations needn't be met.  That's the pressure, can ya feel it?

 

Alternately, the courts can step up and dispense justice.  However, since the courts employ the courtiers, ammo and handtools are probably good investments.  Hence, folks with brains move to the country, which is no guarantee of survival either.

Sat, 02/14/2015 - 11:16 | 5784204 Aknownymouse
Aknownymouse's picture

I think what is ruining the apple cart is FOREX. If the world had one currency only, you could print it forever untl you drive the people standard of living to the ground. The existance of competing currencies and central banks is the problem to the central banks. At some point the race to the bottom will have to stop by someone. Seems like the FED has already blinked. They are determined to raise rates come hell or high water. They are even willing to fudge data to help them raise rates.

Sat, 02/14/2015 - 11:18 | 5784208 kowalli
kowalli's picture

fed can't raise rates,period.

Sat, 02/14/2015 - 11:44 | 5784246 Creepy A. Cracker
Creepy A. Cracker's picture

Agreed.  Even at a modest interest rate of 5.x percent interest on the $18 TRILLION national debt will be roughly $1 TRILLION per year (this will come into play as bonds mature and roll over to current rates).  All we can do is keep printing, defaulting by devaluing the debt and making everyone poor, or defaulting outright. 

 

Sat, 02/14/2015 - 12:40 | 5784344 rccalhoun
rccalhoun's picture

when the fed talks 'raise'...they mean that 1-2% is the end goal for short rates.  4-8 hikes to 1 or 2 % and then they can ease during the crash.   1% aint shit ---its still a negative real rate.  watch the curve flatten as they raise.

but dont expect the crash until the rates actually have some weight to them.  a solid rally will greet the first several rate increases.  watch how this is 'sold' to the public.

we are 2-3 years away from the crash

Sat, 02/14/2015 - 15:31 | 5784709 daveO
daveO's picture

They must raise rates to compete with real money, just like Volcker had to do in 1980. Negative rates, overseas, are already driving foreign investors into gold. Higher US rates mean higher US taxes to pay the interest. DO NOT bet against Boehner agreeing to raise taxes in the next budget. Now, back to work debt/tax slaves. The Free Sh!t Army depends on you!

Sat, 02/14/2015 - 12:46 | 5784351 Clowns on Acid
Clowns on Acid's picture

The Fed says that the charade can continue forever... and if you ever harbor any doubts... Just Buy the Fucking Dip !

Sat, 02/14/2015 - 11:02 | 5784173 xavi1951
xavi1951's picture

Stock up on anything you use made in china.  It could be a long dry-spell.

Sat, 02/14/2015 - 12:42 | 5784347 Harry Dong
Harry Dong's picture

Yeah. The landfills may finally get a breather here.

Sat, 02/14/2015 - 13:31 | 5784425 Byte Me
Byte Me's picture

So the Great Chaos will only last about three months, the lifespan of Tiddlry-Shit.

(Good to know)

Sat, 02/14/2015 - 11:05 | 5784182 Last of the Mid...
Last of the Middle Class's picture

Shiiiitttt, you think those illegal aliens are going to do work nobody else wants to do after they get tax refunds for years they didn't even work then sign up for the free shit army? Think again dildo. This is about garnering votes to stay in power such that divide and conquer can continue for another 100 years.

Sat, 02/14/2015 - 11:32 | 5784231 Coldfire
Coldfire's picture

[S]ome (non-mandated) investors will invest at negative yields if they expect deflation to give them a positive real yield.

What a teeming crock of shit.

Sat, 02/14/2015 - 11:48 | 5784255 max2205
max2205's picture

Utilities are down 9% in 2 weeks....rising yields .....what do they know

Sat, 02/14/2015 - 11:41 | 5784239 ISEEIT
ISEEIT's picture

"Hyper-active central banks might be ensuring both a melt-up bubble and a market crash"

 

Ya think?

Sat, 02/14/2015 - 11:46 | 5784250 Fix It Again Timmy
Fix It Again Timmy's picture

Paging Dr. Cheney, Paging Dr. Cheney - your patient, Iraq, is having a SEIZURE, Paging Dr. Cheney....

Sat, 02/14/2015 - 12:10 | 5784289 headhunt
headhunt's picture

Paging Obama, Paging Obama - your patient, Iraq, is having a SEIZURE while you jack off on the golf course, Paging Obama....

Sat, 02/14/2015 - 12:05 | 5784268 Kokulakai
Kokulakai's picture

@ Greece.

When did the bankers figure out Greece was a kleptocracy?

Before, or after they aided, and abetted?

Sat, 02/14/2015 - 12:07 | 5784280 Colonel Klink
Colonel Klink's picture

YES!

Sat, 02/14/2015 - 12:06 | 5784279 Colonel Klink
Colonel Klink's picture

Captain obvious reporting for duty, Sir!

Sat, 02/14/2015 - 12:08 | 5784285 ISEEIT
ISEEIT's picture

Guy Haselmann is a 'smart' guy. I've read other expressions of thought by him and he deserves respect within the cartoon of this clusterfuck presently imposed upon the macro scale of humanity.

 

What we have here though people is a 'life' about to end.

The joker's have achieved terminal velocity.

This play isn't going to end well.

 

I was a highwayman
Along the coach roads, I did ride
with sword and pistol by my side
Many a young maid lost her baubles to my trade
Many a soldier shed his lifeblood on my blade
The bastards hung me in the spring of '25
But I am still alive

I was a sailor
I was born upon the tide
and with the sea I did abide
I sailed a schooner 'round the Horn of Mexico
I went aloft to furl the mainsail in a blow
And when the yards broke off they said that I got killed
But I am living still

I was a dam builder
Across the river, deep and wide
Where steel and water did collide
A place called Boulder on the wild Colorado
I slipped and fell into the wet concrete below
They buried me in that great tomb that knows no sound
But I am still around
I'll always be around and around and around
And around and around and around

I fly a star ship
Across the universe divide
And when I reach the other side
I'll find a place to rest my spirit if I can
Perhaps, I may become a highwayman again
Or I may simply be a single drop of rain
But I will remain
And I'll be back again and again and again
And again and again and again

Sat, 02/14/2015 - 12:18 | 5784307 noben
noben's picture

Even lottery jackpots are ballooning to Outlier ranges that should happen FAR more frequently than they should.

Methinks that this too is manipulated or rigged. When you're talking about a jackpot in the hundreds of millions, only the dumb or pathologically naive would still trust human nature to be 'honest'.

By contrast, I trust human nature to be true to itself, and find a way to scam. Whether alone (if possible), or in collusion (if necessary). Same as always.

Sat, 02/14/2015 - 15:46 | 5784751 daveO
daveO's picture

Coinciding perfectly with tax return season. What's dumber than giving the state an interest free loan for a year? Then, turn around and it give it right back to them! The government loves stupid people.

Sat, 02/14/2015 - 13:30 | 5784326 VooDoo6Actual
VooDoo6Actual's picture

Whether people want to attribute Greece's preplanned & predetermined Financial Black Swan crisis's to the Guessian Theory or et al or not, the simple ubiqutious reality is that:

Conceptually, the BIS / IMF / Fed Reserve / HSBC / LIBOR / ECB / EU / Bretton Woods Agreement et al are all essentially a bank where money & "the concept of value" & it's hybrids / mutations i.e. goods & services / assets / tranche's / resources etc. are all created in our current matrix & paradigm. The planet has evolved into this system & the PTB clearly want to change that paradigm. We already know they want more control & a digital currency. Whether SSDR's (Supra-Soverign Drawing Rights), SDR's, SDRM, BSA's,  / credit swaps, tranche's, derivatives, bonds, yields, futures, options etc et alia.

Their objective isn't to control the conflict, it's to control the debt that the conflict produces. The real value of a conflict, the true value, is in the debt that it creates. You control the debt, you control everything. This is the very essence of the banking industry, to make us all, whether we be nations or individuals, slaves to debt.

"Quite an experience to live in fear, isn't it? ... That's what it means to be a slave"

Sat, 02/14/2015 - 14:07 | 5784523 JoWazzoo
JoWazzoo's picture

Some of you are criticising the authors use of numbers that are BS.  Well - yeah.  This guy works for a effing bank.  If he used made up numbers like us, he would losee all CREDIBILITY.  He knoew the numbers are BS.  Ever read any of his stuff before?

 

But he has to use the cards he is dealt.  I.E. he must use BS numbers cause they are Printed Numbers.

 

Now moving on.  If you have never read his stuff before, take a look.  He is quite bright.  Read the article

Guy Haselmann: Too Clever By Half

 

you can find it here.

 

http://www.advisoranalyst.com/glablog/2014/12/19/guy-haselmann-too-cleve...

 

He NAILED the markets' actions to a effing Tee after the FOMC meeting.  Did you?  Doubt it.  And he explains why in precis terms.

And yes - I know that WE are effing more brilliant than most people out there.  But brilliance is normally distributed and Haselman is a couple of SDs to the right of us.

WRT the article at hand, I would add one slight touch.  The CBs actions are ~ 5 - 7 sigma when compared with historical processes.  Our thinking usually only goes out to 2 or 3 sigma. (Some of us, such as myself, have no problems understanding out to 9 sigma or so. :-) ) That IS why many of us are bewildered these days with WTF is going on and why market reactions are sometimes counter to what we think.

CBs are in a race, a contest if you will, with other CBs what with ZIRP, NIRP, QE, changes to reserve requirements and currency devaluations.  The effing result is Beggar thy Neighbore and it will not end well.  Confer 1930s.

If you really are bewildered with WTF is going on - read a primer on Game Theory and it will make sense.

One final comment.  The CBs are creating massive amounts of electronic money.  That is what the Fed did with QE. Nearly 5 Trillion. The whole financial community is in bed with the CBs cause they are getting RICH.  Us effing Plebians wonder when the recovery will start and sit around scratching our heads.  We don't get it cause we are NOT who the CBs are helping.

 

 

Sun, 02/15/2015 - 12:51 | 5786936 Livermore Legend
Livermore Legend's picture

A Couple to the Right ? Indeed.... And he is many to the left of me....

The above cite from him in December 2014 has these critical words:

".......It is time to cover Treasury shorts in the front end....... "

As I said, he is MANY to the Left......

 To those who have been and are paying attention, I will "give" you this:

The "Short" should have been put on at 1.5, and covered at 3.0.....

Anyone Positioning before or after those Points in the last 24 Months needs to go back to school.....

This guy is clueless.......

Want the Price Points for the Next 24 Months ?

Ante up the $ 100 Million Gentlemen, and I Will Provide them.

Sat, 02/14/2015 - 15:14 | 5784666 malek
malek's picture

Inverted Guassian distribution - it's OK, just an unintended (cough) consequence of the VAR concept:

"Squeeze the risk into the tail", i.e. make a big risk out of several small ones, after all we know the big lie works better than many small ones too!

Do NOT follow this link or you will be banned from the site!