Macro Afternoon

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Will Bitcoin destroy the US dollar?

Kayaking in the Cook Islands, 2019: Photo by H. Becker

Asian stocks are struggling to gain traction at the start of what is likely to be a low volume trading, following the less than stellar performance on Wall Street on Friday and the weekend news of more economic lockdowns across Europe. Bitcoin is levitating to new heights yet again while gold has pushed through the $1900USD per ounce barrier for the first time since early November, running with the weak USD trend:

The Shanghai Composite is the standout, up nearly 0.5% going into the close at 3412 points while in Hong Kong the Hang Seng Index is dog padding with a scratch session, down a handful of points to 26473. Japanese stock markets remain in stall mode with a mild selloff on the Nikkei 225, closing 0.3% lower to 26665 points while the USDJPY pair has held a steady course at just below the mid 103 level, remaining in its medium term downtrend:

The ASX200 also tread water and did almost nothing today, down about 0.1% to 6669 points, keeping well clear of the 6700 point level after its poor finish last week. The Australian dollar was pushed a lot lower on the open, heading well below the 76 handle as the NSW COVID outbreak gathers apace before Christmas:

Eurostoxx and S&P futures are in retracement mode again, with the four hourly chart of the S&P500 shows it still not able to clear the 3700 resistance level decisively, even though there is some paltry stimulus finally coming out of Congress:

The economic calendar starts the week very slowly as we head into the quietest part of the trading year, with just a few Treasury bond auctions going on.

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Comments

  1. Arthur Schopenhauer

    Ouch!

    The odds-shifting bonanza on election night, with all that money on the line, was not a sign that the oddsmakers knew something the mainstream media did not. Instead, the Trump spike was the peak of a phenomenon that had been unfolding all year. Many Trump supporters were certain he could not lose, and they plowed so much money into betting on him that they distorted markets in his (and ultimately, the sportsbooks’) favor.

    https://slate.com/news-and-politics/2020/12/trump-betting-markets-sportsbooks-offshore-2020-election-gambling.html

    Bloke!

  2. As any self-respecting macro investor, I change my view every 15min so this morning I bought into gold miners again. Never sold 100% but last week I did reduce my exposure and this morning I bought some back.

    • I find it extraordinarily difficult to hold differing long and short term trades on the same asset. My short term views cause me to act on what I’d intended to be my long term positions, often in a sub optimal way! Taking positions with different structures really helps. E.g. bank account holdings of USD are a lot harder to get in and out of than CFD positions. Maybe if you held some physical gold in your house, you might be more disciplined in sticking to your long term view, and your short term views could be expressed in an options, shares or CFD trading account.

    • I suspect your timing on Gold Miners is spot on.

      Thanks for the TP tip -Im glad I started stocking up over the Weekend,

      Ive just packed the Gumboots for Christmas camping ,Haven’t done that in a while.

      One of my favourite songs on Graceland.

  3. Wife just got back from work and on the way she stopped at Coles Casula.. picked the last toilet paper pack. Plenty of food on the shelfs though.

    • I remember from March … toilet paper was first and then it was pasta, rice, flour, breads.
      In Vic in July it was a lot steadier in the supermarket although it was a grind.
      Hope the stocks re toilet paper get replenished quickly and the authorities get on top of it.

    • Has anyone seen any cool face masks? I got a Darth Vader one but it is a bit lame without the entire helmet.

      Is there even an etiquette around masks – how much piss can you take?

      • My neighbor gave me a mask which would turn me into a super hairy bearded bloke smoking a cigar. She thought it’d be perfect poolside making sure people didn’t drown. They have invited us over for Xmas dinner and we’re now ‘gold for life’ after a winter of sometimes twice weekly fence red sessions with our ownfires on each aside of the fence through 2 lockdowns. Haven’t wornthe mask yet though. Take as much p155 as you’d like. People will smile but you won’t know cos they’ll be masked! 😂

          • There were, and continue to be pretty serious health challenges on both sides of the fence, but those fence reds helped both households get through. It wasn’t easy but we know our lockdown was relatively comfortable thanks to the size of the block land we both live on. One of the good things to come out of this year is that a good neighborly relationship has turned into a rock solid one.

    • This is brilliant. EVERYONE should read this.
      I have spent some time down the rabbit hole and can attest that it is designed by people who know a lot about psychological manipulation. The gameplay element is a whole new angle. Thank god I wasn’t exposed to that (got out before Q came along).

  4. TailorTrashMEMBER

    Saw a house today ( north shore ) with a sign
    SOLD OFF MARKET …..what does that mean ?
    ….was it sold directly to China with out a local RE agent
    getting a little of the dosh …to help with Scomo’s
    great magical Australia’s children’s housing for sale to anyone economy ?

  5. WTF are we taking people into Aust who have the new UK super strain of Covid. The NSW CMO says “we have gold plated quarantining so it’s all good” even though the UK strain is apparently more contagious than other strains.

    Here is what the CMO said:

    “Everyone coming from the UK is going into 14 days of hotel quarantine and they are of no risk as that quarantine works so successfully, as it has done for the most part here in Australia since the beginning,” he said.

  6. No doubt gunnas mates in Europe thinks Andews is an uber hero now! Gets to impose whatever he wants and doesn’t have to answer for sh#t.

    “What might surprise the Victorian public further is the extent to which the default position within the state government has become to simply outsource anything it can – in part to cover itself from blame for failures.”

    • Have a look at the SMH comments. Apparently Daniel Andrews walks on water. Some people seem to have Stockholm Syndrome.

    • “default position within the state government has become to simply outsource anything it can – in part to cover itself from blame for failures.”

      Ehhh – ???? – that started long ago under the banner of markets are more efficient [tm], reward the virtuous, and government crowding out in the market place [theft] …. own goal.

    • It amazes me that a Government can be structured to take a decision, not know who did it, and the Premier in charge is not accountable for the structure that allowed it to happen.
      Andrews is happily blaming the Health Minister and Department Secretary, but 800 Victorians died on his watch.
      And the key faults – structuring of hotel quarantine, structured lack of early involvement by Health Department, contact tracing not adequately resourced in May/June despite outbreak in March, all results from the Premier’s decisions on budgeting, resource allocation, as well as Health Department failings after that.
      Even the outbreak in July got to 710 cases/day peak instead of 200 because he was a fortnight slow with the full lockdown.

      Andrews wants to keep going as Premier … and against Windscreens O’Brien one could hardly bet against Andrews really … but if we are demanding accountability then he should be walking the plank now.

  7. In news paper today article says a public tip off line has been set up to catch lawbreakers to ensure foreigners buying houses here comply with the rules which include extra penalties as of January.
    Holly gee Wizz. A tip off line. I guess banning the Chinese from buying our houses is a stretch too far.

    • FUDINTHENUDMEMBER

      Yah it’s all liquidating a bit. I thought markets were supposed to be calm before chrissy..

      • I thought markets are going down and I wrote about it last Friday or on the weekend.. can’t remember. I started buying BBUS last Thursday and still holding.
        Just did not expect gold to fall since US just announced $1tn stimulus that needs to be printed out of thin air.

          • here it is.. I was wrng on the stimulus but rest of the stuff seems to be enough to bring falls.

            NikoMEMBER
            December 20, 2020 at 10:19 am
            My prediction for next week action:
            Massive volumes of options and futures expire by end of the week and many of the call options holders are out of the money. Institutions that issued those contracts also hold huge volumes of those shares while retail investors that bought those contracts hold massive hopes that somehow shares will go up by over 10% so they can make money.
            On top of all that we have political play in the US that is stalling the stimulus package. My view is politicians will not agree on any stimulus before markets crash as Republicans are refusing to allow any money to be included to support local Govs. Reason behind this push is because most local Govs that need that money are Dems run states.
            On top of that Rep want to limit how much FED can spend too. If they get this one then Joe Biden will be limited at what he can do spending wise.
            Everything points to massive volatility over the next weeks starting with next week.
            I bought few BBUS in case I am right. Time will tell and good part is I won’t have to wait too long to find out.
            Lot is riding on Georgia elections this Jan but markets will crash well before that.

    • ErmingtonPlumbingMEMBER

      The guy did a good job serving his people.
      That’s probably why he couldn’t be tolerated by a Plutocratic West.
      I couldn’t help myself criticising Tim Anderson’s use of the racist hashtag “Colonial_media”.
      Instead of acknowledging how western media has been completely taken over by Plutocratic interests this “Internationalist” clearly lays the blame for the atrocities of colonialism on all people of European descent (White people) all
      while ignoring the real Class enemies responsible.
      The a Class he clearly likes to rub shoulders with and suck up to.