Syz the moment

"The US corporate sector is a massive net borrower. Normally when interest rates rise, so too do net debt payments, squeezing profit margins and slowing the economy. BUT NOT THIS TIME. Corporate net interest payments have instead collapsed. What on earth is going on?" asked Edwards "This chart not only explain the resilience of corporate profits, but is a key reason why this recession has been delayed – especially as companies in aggregate are now a net beneficiary of higher rates (NB: this is mainly explained by mega-caps as most of the other companies are in big trouble). Source: SocGen, www.zerohedge.com

Source: Hedgeye

Elon Musk has decided to make X (formerly Twitter) an “everything app” with multiple functionalities, including a payment hub processor integrated with the microblogging social network and other tools from the building ecosystem. Musk already stated that X is a “DOGE-friendly place”. Part of the work of becoming a payment hub, or a cryptocurrency-friendly place, in the United States lies in obtaining the required licenses to operate such a business legally. Elon Musk’s company has been gradually doing that in different states but mostly focused on fiat payments under the “Money Transmitter License.” In particular, this license will enable X to store, transfer, and exchange digital assets on behalf of its users. Source: Finbold, Bitcoin Archive

Source: Markets Mayhem, Bloomberg

FACTS: The overall tone of Chair Powell’s Jackson Hole speech was relatively hawkish but not as hawkish as some feared on the back of recent strong data. It was also less hawkish than last year. The main message is that The Fed is definitely on hold but leaning on a more hawkish stance should data don’t show more progress in inflation / growth cooling down. OUR TAKE: The big event is now behind us, and we didn’t learn anything new. Powell believes that monetary policy is tight, but he opens the door to an even tighter one. With regards to macro data, they are going into the right direction but there is a risk of further upside, i.e interest rates path remains very data dependent which means that markets will now turn its attention to PCE inflation and US jobs data (next week). The Fed is likely to stay nervous as long as they see evidence of a serious break in job growth below the 200K pace. We are not there yet, which means that in the coming weeks, we will likely see macro volatility leading to market volatility. Our view remains that central bankers want first and foremost to avoid the big mistake (rather than targeting a pre-defined target). In the previous decade, central bankers wanted to avoid the deflation trap, hence the over-printing. This time, they want to avoid the risk of another round of inflation. Hence the temptation of over-tightening. MARKET REACTION: Rate-hike expectations initially moved lower but then reverted higher after investors actually read and listened to his speech. 2Y yields are back to July highs and equity markets are whipsawing.

Source: TrendSpider

Source: Fund Strat thru Carl Quintanilla

Sounds like an effective contrarian indicator... Source: Brian Feroldi