Post-War Iran: Uncertain Oil Disruption Potential
One day the war will end. Iran has been crippled and may be further bombed back to the Stone Age. But once the war ends either Iran will be able to disrupt global oil flow or it won't be able to disrupt global oil flow.
Nik Launches New Podcast Collaboration with Jimmy and Team
Nik is building out a great podcast. Proud of what he is doing and he is a great partner at DSMMA. See here for the collab with Nik, Jimmy and me. https://t.co/PqYYoFGCGM
Light Portfolio Delivers 6.5% Alpha, 5% Beta Gains
Positions are super light. Alpha up 6.5% YTD 2% of AUM in SPX Puts bought on yesterday close A boatload of STIR bought higher but exposed to rate cuts and recovering That's it Beta up 5% YTD cuz own gold and commodities as...
Post‑low JHEQX Rally Signals War’s Bottom Ending
Fwiw there have been 3 recent lower strike JHEQX events. The major lows on 6/22 and the actual low was the exact strike on Sept 22. Both followed by massive rallies. This one was the best proxy...
Favor 6180 Settlement, yet 6865 May Arrive Quickly
The first tweet was confusing. I favor 6180 for settlement but 6865 could happen fast https://t.co/P9FqExf0Xf
Shorts Covered, Long Entries
A week ago Sunday we were all bulked up waiting for our levels to cover shorts and bonds and go long two's, gold , zb and stocks. Some of our levels hit (we covered shorts and had highly levered...
War News Fuels Reflexive Sell, Spurs Leveraged ETF Buying
Gamma. Roll delta flips, month end equity buying not needed as much given price, sudden massive leveraged ETF buying now needed. All this in an environment which makes folks think the war news is actually the thing driving markets....
JPM’s PM Moves, Not Just Short Gamma, Drive
If you think the only thing that's happening on $JHEQX collar is short gamma you are completely missing what the PM at JPM was doing to roll the collar before the rip and what they now have to do.
Management's Costly Deals Hurt Shareholders, Create Profit Opportunities
Screw your shareholders by doing a stupid massively expensive issuance favoring a particular investor. Underperform your asset by 15%. It's unbelievably easy to make money when idiot management do these deals $MTPLF $ONDS $IONQ https://t.co/kMwFGySBfO
Big Tech Stocks Slide Deeply Year‑to‑Date
YTD $AAPL -9.1% $AMZN -12.6% $GOOGL -12.5% $META - 18.6% $MSFT -25.8% $NVDA -11% $TSLA -20.6% https://t.co/zGRemDg3Sb
Weekly 20‑Minute Podcast Simplifies Portfolio Risk Insight
The whole point of 2Graybeards is to provide a credible once a week check in for busy people who need a 20 minute credible synthesis each week. If that's you and your trawling twitter or cnbc or mainstream media...
Asset Supply Surges, Credit Stagnates Amid Wage Stagnation
Note sent to clients. Overall macro synthesis and update based on war related conditions impact and pricing. What we are doing about it is for clients only. Based on all things happening in the world my macro view is...
Stay Near Target Risk, Always Own Market Beta
If you are persistently leveraged long assets above your risk target you are doing it wrong and this month is a lesson. Consider moving to your risk target If you are perma bear and always underinvested and in...
Questioning SPX Earnings Surge Amid Short Covering
I'm in the midst of covering all of my equity shorts and going long. But jeez just checked SPX NTM Bloomberg consensus earning of 334 vs 277 trailing or 20.6% expected earnings growth. Honestly is there a legitimate...
Trump Could Spark Unofficial Iran Peace via Single Tweet
Is there a unilateral tweet Trump could make today that results in a "peace" trade that is NOT corroborated by official Iran
JCPOA Viable,
Asked Claude for this (heavily guided the framework myself and used Claude for format). Seems about right. Basically something like JCPOA is possible and the new issues are impossible to bridge the gap. https://t.co/YnSNjDjGMw
JHEQX Option Shift Negligible; only Market Makers Notice
This may or may not be true. But unless you care about which exchange/clearing/venue has volumes. Shifting $JHEQX from SPX cash options to some other form of ES options or BTIC+ settled ES options has literally no impact on...
Oil Price Surge Adds 2.8% to CPI Inflation
Funny math. If Dec oil meets futures. The YoY inflation of oil will be roughly 40%. Pick your inflation basket weighting and any feed through to core . Headline CPI direct is roughly 7%. Others...
Trump’s GSE MBS Boost Fades, Mortgage Rates
All the manipulation impact of Trump "Instructing the GSE's" to buy 200BN in MBS has disappeared as OAS is now higher. Throw in higher vol and modestly higher 10's and you get higher mortgage rates. https://t.co/NKfe9Jq3vg
Bessent's No‑Term Debt Plan: Mixed Results So Far
So how has the plan by @SecScottBessent to not term out the debt and keep rolling bills worked out?
Prefer QT and Term‑Premium Expansion Over Fed Rate Hikes
Fwiw I still prefer restarting QT and solving the uneven distribution of reserves and killing inflation through term premium expansion vs hiking fed funds https://t.co/tp7owr8gxQ
Original Persian
The OG map in case the Persian Gulf map is stale. Props for the H4L folks. Though they got it right due to war perhaps. https://t.co/znhzJ8nL12
Exiting Non‑US Rally, Maintaining Global Balance with Cash Buffer
After a massive run in non U.S. assets for 14 months, over the last few weeks, I have been getting out of the "Get Out" trade for my long only long term beta portfolio. Current portfolio is a globally...
Vol Skew Interpreted as Implied PDFs Across Expiries
Here's a question for options nerds Ignoring if it's "right" or "wrong" whether it's caused by paper flow or some expectations. Is baseline assumption in modern option thinking that each expiries vol skew represents an implied PDF and the vol...
10‑Year Treasury Real Yield Stalls at 1.89%
1.89 10 year tips real yield. Meh. Not much return yet in the benchmark asset on earth. Less than 3 months ago.
Investors Flock to Long‑term US Treasuries Today
It's funny that long term US treasuries is where people are putting their money today. They make more folks.
2026 Dot Rise Missed; Haw
Those predicting the 2026 dot would rise to no cuts just didn't do the math. What did happen is the 3 Most hawkish reduced from a protest hike to a pause (less hawkish) 3 middle doves got modestly more hawkish And Miran the...
Warrant Sold at Deep Discount, Enriching Hedge Fund, Hurting Shareholders
Unlike a convert which sells a warrant at a relatively fair implied volatility and monetizes that vol for the benefit of existing shareholder. This atrocious deal sold the warrant at a massive massive discount to fair implied volatility and...
Learn From Results, Avoid Paralysis and Overconfidence
Learning from bad outcomes GOOD Being paralyzed by bad outcome BAD Learning from good outcomes GOOD Being overconfident due to good outcomes BAD Welcome to my Ted Talk @pmarca
FOMC Chaos: 5‑Year Inflation‑Killing Plan Revealed
The FOMC is a mess. I have been writing about the original sin, the false flag of 2019, and a workable plan to kill inflation for 5 years. Here is Sundays client only DSR. I'm making it...
Fed Hikes Driven by Macro Policy, Not Oil Spikes
In the two oil shocks of the 70's the Fed tightened due to the broad inflationary impact of leaving the gold standard and Bretton woods. Oil was a symptom not a cause of inflation In 90 the Fed paused cuts...
Fed Shouldn't React to Oil Supply Shocks
Should the Fed hike due to a supply shock in oil? No. Should the Fed cut due to oil supply shock causing weaker real growth. Also no. Get a grip pundits.
CLZ26's High Risk Premium Reflects Delivery Incentive
CLZ26 price of 75 is the expected forward spot price of oil for December delivery plus a risk premium. That risk premium is likely higher than normal (Z26 is cheaper than normal) due to the high incentive for those...
Desperate Financing Deals Tank Issuers, Boost BTC
I'm not gonna bother. This is another atrocious deal for the issuer. $MTPLF joins $ONDS, $BMNR, $IONQ doing a deal which costs 25-40% of proceeeds to get desperation financing. All companies that have done this deal have...
Alternative Fed Tightening Tools, Not Rate Hikes, Curb Inflation
FWIW while many are suggesting Fed Rate Hikes and markets are beginning to price that as well. We much prefer 1. Ending RMO 2. Addressing the uneven distribution of reserves by establishing a minimum reserve requirement to protect the high...
Central Banks Delay Hikes in Supply Shocks, Await Wage Inflation
The supply shock move in Energy prices, fertilizer prices, and food prices IS a Rate hike which slows the economy and is disinflationary to goods and services that are not energy and food. A dual mandate central bank doesn't hike...
Trade on Macro Fundamentals, Not Noisy Economic Data
Don't stare at spot noisy reported economic data. Answer these questions at a high level. Directionally not precisely. Is the U.S. labor market healthy and labor is in demand Is the population growing Is the 6 month to a...
IBIT + Short Call Matches STRC’s 11.5% Yield
One last comment on $STRC as I am bored of the whole thing and happy just owning long $IBIT Over the next year you could own STRC and get 11.5% yield. Or Go long IBIT and short ATM call and collect...
MSTR Overvalued, STRC Cheapest—Buy IBIT Instead
Let me summarize my view on $MSTR The entire capital structure is rich to BTC. Except for the fact that the company will issue at par as much of $STRC as investors want to buy AND only issuance or BTC...
Oil Futures Can Hedge Inflation Swaps via Energy CPI Component
Curious ? Inflation swap traders. Do you do partial arbitrage on inflation swaps using long dated oil contracts? For instance if receiving inflation do you sell CLM6 and buy CLM7 given that 8-20% of the cpi basket is...
Expect a 4‑Hour Market Stall After Rapid Move
Those who smoke brisket can relate. In big move days the move happens rapidly till about now. Then the combination of 0DTE and leveraged ETF rebalance flows causes a 4 hour stall. Wrap the meat. Leave...
Trump Bought Just 20M Barrels Amid Low Oil Prices
It's pretty amazing that the Trump administration only bought 20MN barrels of oil given oil averaged in the low 60's.
Ponzi Selling to Ponzi; Saylor Tweets Trigger Sell‑off
A ponzi selling to a ponzi. Perhaps I am being manipulated but all these Saylor tweets make me want to sell my coin not buy more.
MSTR Spends $1B Annually on Zero‑yield Assets
The capital structure of $MSTR costs just under $1BN to fund every year. The assets of the company earn zero yield. The carry is paid by issuance.
Market Already Priced the Rally; Right‑tail Calls Unchanged
SPX is up 100 handles since Friday close. 10 Delta "right tail" 3 month calls are unchanged. The right tail was more than fully priced. If you are congratulating yourself for "calling" a taco/war cessation or whatever....
Choose Volatility Sales over Raising Cash This Week
Did you raise cash last week or did you sell vol, deploy cash, and sell put spreads?
VIX at 28 vs SPX Down 4.6
Vix front contract is 28 SPX Level 6650. Down 4.6% from ATH Which one is "wrong"
Fed Needs Inflation Surge Before Rate Hike, Bear Ste
Nice job Fam getting my old colleague and experienced central banker 5k followers in 3 days. Still massively underfollowed. Fwiw IMHO the U.S. Fed is going to need an explosion of inflation to hike in the next year....
Diversify Now; Active Hedging Won’t Save a Sinking Portfolio
With vol high/skew high but OTM calls also high and with equities in a minor drawdown those with undiversified max long U.S. equity portfolios are whipping around "options" trade ideas as the solution. Looking for ways to hedge. ...
Short‑term OTM Calls Miss Right‑Tail Market Moves
If you sold long stocks on Friday and bought 10d 3 month calls at equal notional you are going to underperform badly in most right tail events. Doing it delta neutral is highly likely to get destroyed in most...