As I sensed a few hours after the NYSE opened on Liberation Day, the masters of the universe on Wall Street and the White House have knowingly ignited the mother of all Lehman/Liz Truss moments in the global capital markets. Like Shakira’s hips, my Bloomberg screen does not lie as it speaks to me in its ominous green phosphorescent flicker.
The Volatility Index is once again above 50 and in Wall Street this is the day of judgement, especially for leveraged sinners dumb enough to buy complex structured products from private bankerjee and, God forbid, external asset banksterjee since these timebombs in their portfolios have now exploded. In their doomed quest to make a killing, thousands of poor souls will now lose 100% of their capital as it disappears into the digital whirlpool of money heaven. In the Gulf, this is known as petrodollar jannat al faloos.
I literally trembled as I saw the 30-year Uncle Sam note yield, the long bond as we called it in the pits of the Chicago Board Of Trade when Mr. T was the biggest T-bond futures gunslinger on the planet, trade above 5.02% in Tokyo last night. The world is now talking back to Mr. Trump and DonnyT’s Manhattan swagger has been dampened a bit by the kamikaze dive in King Dollar.
I went long the fiat money of Charles Trois’s sceptred isle as a relative safe haven from the madness/manias and financial Tomfoolery of the MAGA apostles when cable was 1.24. Cable is now 1.30 and it is time for some good old fashioned Anglo-Saxon bhangra if I read the smoke signals from HM Treasury, the Bank of England and the high octane FX gnomes of Bishopsgate/Mayfair right.
The Reichsmark (oops, Euro-Shuro yaar) is now 1.12 and headed to 1.20 when deflation will haunt the Old World. My fave FX trade for a world gone mad? Long the Buckeroo against the Mexican peso for a target of 25. Cardenas was right. As I echoed his words at the lovely Jain’s merchant conclave at the Westin Mina Seyahi, “poor Mexico, so far from God and so close to the Estados Unidos (US)”. This was said by a Mexican President 60 years before our admittedly bratty DJ Trumpkins became El Presidente of Gringolandia.
The 10 year risk free money is now 4.4% and headed to 6%. Don’t you dare downgrade the Uncle Sam IOUs again or DJT will order every Moody’s/S&P credit rating exec to be triple taxed and then deported to Vlado the Badoo arctic Club Fed gulag. Suckers and losers got no place in the United States of Amnesia.
Nasdaq just lost 7% of the 12% it made last night and I fear we are all riding on a one way ticket to the moon. If I was Trump, I would listen to the Coldplay hit from the 1990’s as he sleeps in the Lincoln Bedroom and munches Big Boy burgers with ScottyB. “I used to rule the world. Seas would rise when I gave the word. Now in the morning, I sleep alone. Sweep the streets I used to own”.
Also published on Medium.
