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Marc Chandler

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  • What The Fed Did And Did Not Do [View article]
    memshu...thanks. see new post up shortly about price action.
    Jun 19 10:20 AM | Likes Like |Link to Comment
  • What The Fed Did And Did Not Do [View article]
    Samuraitrader, and what exactly about that quote don't you agree with? That CPI has been on the high side, or the high frequency data is not noisy ? Do you know why the Fed prefers core PCE deflator ? Do you know the difference between it and CPI ? Bond rallied after the FOMC statement and Yellen's press conference. If you think inflation is a bigger problem that Yellen and the Fed, there are investment strategies you can make. Short the bonds. Buy TIPs. Reasonable people can and do differ. Is the Fed behind the curve because inflation is high in the US ? I don't think so. There have been people warning about inflation since QE1. I do think price pressures have bottomed, but are not increasing very quickly, allowing more time to get closer to the full employment mandate.
    Jun 19 08:52 AM | 1 Like Like |Link to Comment
  • What The Fed Did And Did Not Do [View article]
    I do not know why "we have to look at this as a collective union" ? It is not like the Plaza Agreement that coordinated action. QE is central banks, near the zero bound easing monetary policy. QE is the form of monetary easing under present conditions. Australia and New Zealand have lifted interest rates under QE in the US and Japan. Moon said that no one believe the Fed will stop QE. I disagree. How do you figure BOJ QE is scratching the US back--what ever that means? Is the US and BOJ helping to scratch the euro area back? How exactly ?Is the US in a liquidity trap ? I do not see evidence for this.
    Jun 19 08:13 AM | Likes Like |Link to Comment
  • What The Fed Did And Did Not Do [View article]
    Just want to point to to our insulting commentator JasonC8847 that risk assets have rallied and MSCI EM did extend its gains, as I anticipated in my comment above. I am not familiar with the chart he refers to on ZH, but I do see institutional investors buying risk assets, including a recent Bloomberg report on how many including Blackrock and Prudential increasing their holdings of Greek assets. I am not sure who he is that he calls SA readers sheep. And who he thinks he is, some great holder of the truth. I said that the still stimulative policies bodes well for risk assets and weighs on the dollar. Is this not what happened ?
    Jun 19 07:58 AM | 1 Like Like |Link to Comment
  • What The Fed Did And Did Not Do [View article]
    Moon--seriously, no one? I for one think the Fed stops buying long-term assets at some point. Program is winding down. Recycling maturing issues maintains balance sheet but does not expand it. I have argued that just as the central govt balance sheet became a tool for macro economic management post WWII, so too has this crisis brought the central bank's balance sheet into play. Has not the BOE stopped its asset purchases ? Has not the SNB ?
    Jun 19 07:51 AM | Likes Like |Link to Comment
  • U.S.-German 2-Year Rate Differentials And The Euro-Dollar [View article]
    I would make three points:

    1. the markets are a discounting mechanism and the decline in the Eonia may already point to this as the week ahead (week of June 15) is when the ECB formally stops sterilizing the SMP purchases.

    2. Lower rates for longer may encouraging foreign purchases of peripheral stocks and bonds, which could moderate the selling pressure on the euro that may emanate from its easier monetary policy.

    3. The SMP purchases will gradually mature and as they do this will not be a drain of access liquidity.

    I had anticipated a sell the rumor buy the fact type of activity in response to the ECB's initiatives. Though bearish the euro over the medium and longer terms, I had thought there was potential toward $!.38. However, I am not impressed with the bounce off $1.35 and recognize the risk that it is broken in the coming days.

    What do you think ?
    Jun 14 10:56 AM | Likes Like |Link to Comment
  • Scottish Referendum 100 Days And Counting [View article]
    Angel, agreed. Still risk of "pretty dramatic swings in a short period of time". Will stay on the case, but thought it is was timely and something that should increasingly be on radar screens.

    And I would agree with Mobyss about where the passion lies.
    Jun 11 06:16 AM | Likes Like |Link to Comment
  • Draghi Does Everything But QE [View article]
    Dr. Duru...I had tried to explain this before the fact. Take a look at several of my posts over the past week or so. Th euro was sold on the rumor or ECB action and was bought back on the fact. It is also, I note, what happened to the dollar around the time QE3+ was announced. The impact of negative deposit rates may not be so much on the banks and the banks customers--large depositors, money market funds and some, including myself, are concerned about the potential contractionary nature of negative rates. The reason banks have not lent it out is much more complicated, I think than 10 bp. What did Draghi say about the euro yesterday? Nothing.
    Jun 6 06:10 AM | 1 Like Like |Link to Comment
  • Inflating Deflation: Confusing Symptoms With The Illness [View article]
    David, thanks. I do not think my argument rest on deflation in the periphery to incentivize the Germans to act appropriately. I think that deflation in the periphery will boost the periphery's competitiveness. That Germany acts appropriately and by that I think you mean to stimulate its economy is trickier. I do think a number of small measures have indeed been adopted or will be: a minimum wage, an earlier pension age for an specific demographic cohort, more infrastructure spending, key wage increases above the rate the of inflation These are far too small, I think, to blunt the current account surplus. If some argued that the large trade deficit in the US strengthened the forces of protectionism, can't we argue that lack of aggregate demand (i.e. "Keynesian fluff") fosters political instability and anti-immigration efforts?
    Jun 4 04:36 PM | 1 Like Like |Link to Comment
  • Thoughts On The Mysterious Low Volatility In The Capital Markets [View article]
    John, this is a cross asset market phenomenon. Not just "VIX-stuff etfs". The hypothesis that follows from this is that vol will bottom before "government interference" does.
    Jun 3 04:12 PM | Likes Like |Link to Comment
  • Thoughts On The Mysterious Low Volatility In The Capital Markets [View article]
    convoluted, you may be right, but what is striking is that volatility is lower across financial assets not just equities. This is why I tend to think lower volatility is not the result of a new product/products.
    Jun 3 04:09 PM | Likes Like |Link to Comment
  • Thoughts On The Mysterious Low Volatility In The Capital Markets [View article]
    Mobyss, this is a poor strawman. I never said the extraordinary measures taken by the Federal Reserve have not led to any problems and never will. I simply say that the government actions have not lined up well with the decline in volatility. I am not forecasting what is going to happen to volatility. I am trying to shed some light on why volatility may be low. You are free to write what you want of course, but in the commentary section, it is most helpful to stay on topic.
    Jun 3 04:08 PM | 1 Like Like |Link to Comment
  • Russia: Cost Of Victory [View article]
    Robgra, in my view they did not get a free warm water port. They had it before annexation. And now it is not for free. I recognize the energy in the Black Sea, but it is not like it will come without costs. It is one thing to have the oil and gas there under the sea, it is quite to get it. Ask Petrobras in Brazil about monetizing great oil fields. I do not think that sanctions are toothless and the nature, as I have written here previously, is of a longer term nature. These are are toughest sanctions applied to Russia. How many people complained that the US sanctions imposed on Russia after it invaded Georgia in 2008 were toothless. One could argue that if Bush would have confronted Russia in 2008, the Ukraine story may have played out differently. The strong out nature of them is part of the design, allowing for escalation. I do not see the US as the resounding loser. Russia has made more of its neighbors fearful of it. It has reinvigorated NATO. It helps blunt the Snowden leaks. Russia is more isolated now that it was before. You may say that the US has lost status and I would be interested in seeing polls since the Ukrainian election. The fact that the election was held and that Russia did not interfere, which had looked possible (likely?) before.
    Jun 2 05:17 PM | 3 Likes Like |Link to Comment
  • Thoughts On The Bond Market Conundrum [View article]
    Angel--this is the kind of thing I am talking about:
    May 31 02:06 PM | 1 Like Like |Link to Comment
  • Thoughts On The Bond Market Conundrum [View article]
    Agreed. Small gains vs expectations and still low pace. But, I do not see inflation as "moderating", but slowly increasing. I think these regulatory and supply issues are the most important presently.
    May 31 01:33 PM | Likes Like |Link to Comment