Once again, the brilliant Jeffrey Snider of Alhambra Investments explains the importance of the eurodollar system

Eurodollar University: Inputs, Outputs, and Proxies

 

The US Treasury Department’s update of its Treasury International Capital (TIC) report for October contained no surprises. In many ways, it was ironically uninteresting given the constant excitement that had happened during that particular month. It was, in a word, a mess for global markets. Liquidations struck throughout the world and more than a month later we are still struggling through the consequences.

A worldwide global liquidity pullback like that has led to “selling UST’s” by foreign central banks. Foreign systems require dollars no matter what (dollar short) and if the eurodollar system won’t make available a reasonable supply (dollar shortage) the options for any overseas system is either liquidation or support. Often some of both.

https://www.alhambrapartners.com/2018/12/18/eurodollar-university-inputs-outputs-and-proxies/

 

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Anson Funds co-founder honoured today by BNN Bloomberg

Anson principal and co-founder Moez Kassam (Twitter @munchingmoez) recognised today as one of Canada’s Top 40 Under 40.  Bravo Moez, richly deserved!

 

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Intro:

Meet Canada’s next crop of great leaders.

BNN Bloomberg, in partnership with executive search firm Caldwell Partners announced the 2018 class of Canada’s Top 40 Under 40 on Wednesday, shining a spotlight on some of the nation’s top young innovators and entrepreneurs.

“It’s easy to understand why we recognize and honour the Top 40 — they are truly remarkable young women and men, who are experts in their fields and passionate about their work and communities,” Elan Pratzer, managing partner for Canada at Caldwell said in a statement.

“I also thank our program partners for their commitment. They understand that when we honour young leaders, it builds a sense of responsibility in them to be bold but thoughtful, and to contribute to our national economic and social vigour.”

The recipients will be honoured at a gala in Toronto on Nov. 21 and will also be featured in exclusive BNN Bloomberg interviews throughout the summer.

Full story: Canada’s Next Leaders: 2018 Top 40 Under 40

Alhambra – The Money Of Metals; Or, Inferring Collateral Beyond Repo

Yet another excellent blog post by Jeffrey Snider of Alhambra.

Quoting Jeff’s summary:

“To sum up: what I suspect has happened since April 18 is that FX has been more exclusively the epicenter of growing “dollar” problems that in all likelihood, in my view, are similar to Credit Suisse’s 2015 experience. Any background relationship to China is relatively self-evident for expectations(risk) as well as in direct practice (Hong Kong).

Therefore, as the BoE publishes its gold custody holdings over the coming months I expect that they will, factoring some lag, show more significant declines past April. That would confirm collateral and gold as a substantial factor in what has taken place so far.

This isn’t to say the repo market is out of the picture entirely; quite the contrary, as noted above and yesterday. Rather, in terms of collateral flow there hasn’t been as much effect in that part of the global “dollar” apparatus (which could be, ironically, the work of additional T-bill supply which is entirely OTR and therefore helpful only in that market).

Where all this fits in on a big picture level is to further confirm what is merely being hinted at by these metals and how these metals are being used, or not used. An end to Reflation #3 and the arrival of the first stages of what would almost surely follow. The possible switch from a general inflationary trend back again toward deflation all over.

Eurodollar Event #4. It’s not gonna show up tomorrow since these things are, obviously, very complicated and drawn out processes, so we’ll have time to come up with a better name – if that’s what’s happening.”

http://www.alhambrapartners.com/2018/06/26/the-money-of-metals-or-inferring-collateral-beyond-repo/

Mental Models: The Best Way to Make Intelligent Decisions (from Farnam Street)

Jumping directly into the intro from this excellent article:

How do the most rational people in the world operate their minds? How do they make better decisions?
They do it by mentally filing away a massive, but finite amount of fundamental, unchanging knowledge that can be used in evaluating the infinite number of unique scenarios which show up in the real world.That is how consistently rational and effective thinking is done, and if we want to learn how to think properly ourselves, we need to figure out how it’s done. Fortunately, there is a way, and it works….

https://www.farnamstreetblog.com/mental-models/

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