DC @Dimitiii

Why (now) is Poland paying for full page ads in WSJ to announce their involvement in the rebuild of Ukraine? #Armistice

Dinner Bell. DEC Brent, $75.09 DEC WTi, $70.69 tinyurl.com/mu4zhn2b The net position across the three major crude contracts fell to 205 million barrels, the lowest since at least 2013, when data became available in this form. Bullish long positions exceeded bearish short ones by a ratio of just 1.86:1 (2nd percentile for all weeks since 2013). The last time fund managers were so pessimistic about crude prices was during the first wave of the coronavirus pandemic in 2020 and before that during the volume war between oil producers in 2014/2015.

Graphic explanation behind Amerika's Secretaries of Treasuries and State flying to Capitals of the world's creditor nations. Balance of Payments stress must be halted ahead of an election year. Net International Investment Positions, Normalized. US NIIP = off the reservation.

Without announcement, FED has commenced operational Yield Curve Controlled Channel [YCCC]. ~15bps YCCC over a 100day period. All in the Open.

#Gold spot hesitantly erased ~100pts over past 4wks, as 125T. paper gold shorted ahead of BRICS+ Summit. Gold DSI printed 12, level zone which marked ALL intermediate entry points since 2018. Weekly 3m Gold volatility has compressed little over past month. 20wk 3m GV sitting atop secular band. Underwater beachball, set to launch. Spot Gold, $1888.88 3m GV, 11.83 Gold-Oil Ratio, 21.84 [XAU/OPEC basket Px]

The past week witnessed the highest weekly short selling for the year according to GS PB. Deepest call less put volume differential since depths of COVID vortex (20day average). Equity panic premiums, in place.

1/ Amerikan "Ally" Terms of Trade cascading. 2/ G5 duration bid-less, threatening to rip above OCT '22 Maginot lines. 3/ G20/World leaders Summit, SEP 9-10. This at a time when $USD liquidity has contracted back to levels of (magical) inflection. Politburo markets.

Spot China gold (SGE) trading ~120pts (+6%) premium to liquid COMEX contract. 2x historical max premium. 10d average pricing ~+69pts (+3.6%) premium. Unparalleled. SGE premium bid has now persisted for 3months, a record. A sizeable global basis arbitrage window is open. This confirms Brinks vault drawdown at Comex to 3.5yr low. Upside gap risk to western futures pricing. Comex gold, $1906 LBMA AM fix: $1912

Sino Gold basis supporting (prompting) unparalleled LBMA-Comex/SGE basis expansion. Sino GC basis persistently blew-out of historical range in early AUG, and is now levitating ~+3.80% - on 10day average lookback. A lasting range expansion. LBMA am fix, $1918 SGE AUAA, $1992

Empirically, $USTs are the new junk debt. Duration adjusted % return, HYG > TLT: ~10X YTD. Public into Private asset switch in full view.

Sino-Comex silver spot basis: ~16.34%. Rolling 10d average basis: ~10.57%. Crickets. Last >10% basis printed week MAR 20-2020, nadir of COVID liquidation vortex. Siz3, $20.96 SAz3, $24.64

The author of the below BBG article fails to understand the transformational flows dynamic of his very own headline. CMX/LBMA gold, $1947/oz. last (BFW) Gold Is Looking More Appealing as a Haven Asset Than Bonds. [...]In fact, the recent rise in spot gold prices, despite higher real yields, has altered the typically strong and consistent inverse correlation between the assets, based on the difference measured daily over a 40-day period. The inverse correlation now stands at around a measly -0.28, suggesting more breadth in gold’s current rally.

*WALLER: IF RATE HIKES CAUSE INSTABILITY, FED HAS OTHER TOOLS All in the open.

Exquisite setup: Long EUR crosses. CitiFX Pain gauge -reflects crowded market conditions - at MAX short levels, looking back ~15yrs. EUR$, 1.0915 JPMqEUR, 122.35

New Motto = "T-Bills and Panic." $5.9T has flooded into money markets. 1.5x that of peak GFC risk-aversion. ~20% of US GDP. To boot, retail continues to hoard 2-3x short equity ETFs. Early doors. MSCI World, 3047 Russell 2k, 1880 HK Hang Seng, 16334

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Hedge Fund pain train. "VIP L/S equity basket": HF 13F long positions / short exposures. +40% a month ago to...+11% today, or -14% 'alpha YTD '. Chip shot from zero returns on the year. High class fees/low class returns +outsized vol, two years running.

Unparalleled Depression. Hang Seng Enterprise Index [HSCEI], the broadest China-related equity proxy - inclusive of H-shares, Red-chips, & P-chips - has never before drawn-down<-40% over a 3yr period for longer than six months without an intervening rally of ~44-210%. This is inclusive of the Asia/LTCM Crisis of 1997-98. Now going on ~12 month, left-translation drawdown. Yet the political-financial Power structure of China could not be more explicit in its overt messaging: "Chinese government departments led by the PBOC said measures needed to be stepped up to strengthen financial support for private companies, including unblocking and sustaining funding channels. Efforts should be made to “unblock” financial channels such as loans, bonds and shares, the PBOC said in a joint statement with 7 other government departments and regulators." Continued losses across broad China share markets at this juncture could prove existential to China’s private capital formation and socio-economic confidence. The reflexive doom loop will be broken. This is not a choice. CNY crosses signaling. HSCEI, 5635 ChiNext, 1820 FXI, 23.86

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US banks leaning into FED Bank Term Funding Facility. Exploiting balkanized UST pricing at par/rate arb. No matter. Velocity of collateral at hand. A form of targeted, high velocity QE. 'Coincidentally', this ramp kicked-off week of NOV 1, the violent pivot higher in US risk parity. *FED'S BANK FUNDING FACILITY LENDS RECORD IN WEEK ENDED DEC. 20 ($131Bn)

Amerika's Epidemic: "Every 14 months, America loses more people to fentanyl that it has lost in ALL of its wars combined since WW2." [The Economist, DEC 9 2023] ~75K+ (and rising) opioid overdose deaths/year. Frightening. The enemy is ravaging Amerika from within, quietly, systematically. tinyurl.com/3twmtfje

Bat Phone ☎️sounding at 1500 Pennsylvania Ave: Extreme fragility now across USTreasury curve. Prevailing liquidity has deteriorated to ~15yr wides, nearly doubling bid-ask extremes of Covid panic which shattered US sovereign collateral values.