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Archives of “August 2019” month
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Germany 10-year yields fall to fresh record low as bond rally extends to Europe
Trump’s latest tariffs announcement is fueling the bond rally further
10-year bund yields have now fallen to a fresh low of -0.478% and looks inevitable to hit -0.50% as things continue down this path. At times, it’s crazy to imagine we’re living in such a world of negative yielding assets but it is what it is now.
These are desperate times, especially for investors.
If you look at the German sovereign yield curve, it’s only a matter of time before it entirely flips into negative territory at this point:
US Secretary of State Pompeo: Time for China to stop taking advantage of trade
US Secretary of State Michael Pompeo
US secretary of state Pompeo is on the wires saying:
- dispute about central premise of high global trade done
- it is time for China to stop taking advantage of trade
- China using predatory trade tactics for decades
- China behavior has negative implications for business
- Pres. Trump is clear that he wants China to do the right thing
- US won’t tip and to what it will or won’t do in Hong Kong
- engaging with Kim didn’t give him a darn thing
- urges China to do the right thing regarding Hong Kong protests
- China capital flowing to the US should not compromise national security
- North Korea needs to fulfill promises made in Singapore
- US fully committed to denuclearization in North Korea via diplomacy
- US taking a toughest response to North Korea in history
- Iran sanctions have been effective and we will enforce them everywhere
- China has been helpful in engaging North Korea
$USDKRW 1197 high Highest since January 2017
2-Year yields plunging the most in 3 years!
Trade war in full swing & rate cuts late in the cycle with stocks at absurd valuations. What’s left for the bulls?
NOW is all that matters when it comes to executing that next trade
Lao-Tzu was an ancient Chinese philosopher and writer who coined the following phrase:
‘If you are depressed you are living in the past.
If you are anxious you are living in the future.
If you are at peace you are living in the present’
In relation to trading, living in the past may relate to a bad trade you made. Maybe you risked too much and took a heavy loss. Or perhaps you made an impulse trade centred on FOMO which ended badly.
If you replay negative experiences over and over, it can lead to depressing thoughts. And an inability to move forward, clean the slate and inability to execute the next trade. It can also lead to revenge trading and the urge to make up for past losses quickly.
On the flip side if you are living in the future, anxiety can set in. You end up worrying about your future trades and the money side of things. The bills you have to pay. A list of endless hypotheticals start entering your mind.
Yet when it comes to trading, or anything else in life, living in the NOW is crucial. Learning from the past and planning for the future are ok. Yet executing and focusing on what you are doing right now is most important.
We need to remember as well that the market doesn’t care about our past losses. Nor does it care about our future bills. So although worrying about these things is natural, it’s not going to help us succeed with our next trade. In fact it will likely create unwanted blockages towards future success.
Being and working in the present though eliminates negative thoughts and reduces anxiety. It means you are working afresh from a blank slate. With that next trade being completely independent of any other you have recently made.
Doing the right thing right now is what is important. Not the mistake you made last time. That is ‘old news’ and no longer matters. So focus purely on what is in front of you. Plan the trade, trade the plan and refuse to be tempted by impulse or micromanagement. Two actions that are often influenced by past actions combined with future expectations.
Trade in the NOW and affirm to yourself that the NOW is all that matters when it comes to executing that next trade.
Trump turned down idea from Mnuchin to warn the Chinese
Headline says: “Pres. announced tariffs after tense oval office meeting”
There is a headline saying that the president announced tariffs after a tense oval office meeting. According to the report, the president ruled out Treasury Secretary’s Mnuchin’s proposal to warn China of potential new tariffs.
It does not say how Lighthizer sided, but got to think he and Navarro were a thumbs up. Larry Kudlow was likely a thumbs down. If Wibur Ross was in the room, he would be a thumbs up too.
Global Times Xijin: China will focus on national strategy under a prolonged trade war
China Global Times Editor Hu Xijin tweets
China’s Global Times editor Hu Xijin is tweeting:
Xijin is thought to be a sounding board for the government of China but don’t be fooled… the thoughts are meant to manipulate.
For example, he tweeted yesterday, maybe in hopes to make people (Trump?) think that the trade talks were not bad. In reality, things did not go well.
The tweet above, is intended to portray a China that is not concerned.
Trump meanwhile commented in his impromptu press conference, “That if China does not want to trade, that is fine with him”.
Now there is a level of dealmaking gamemanship from Pres. Trump as well. Who holds the stronger hand in this game of chicken? It seems the US does (but with some casualties too), but that does not mean China will admit guilt on things like IP theft anytime soon. The war continues
Trump’s new tariffs send Indices skidding lower.
Major indices end near session lows. Give up big gains in the process
Pres. Trump surprised the stock market by announcing 10% tariffs on $300B of China good effective September 1. He is on the wires saying that the tariffs can be raised beyond 25%, and said that the 10% is for a short term period. I guess the combination means, the 10% will go to 25% if there is no progress, not the other way around (that is how I read the it).
The news reversed strong gains.
At the highs, the:
- Dow was up 1.16% or 311.32 points
- S&P was up 1.11% or 33.21 points
- Nasdaq was up 1.66% or 135.61 points
At the close the final numbers are showing:
- Dow, down -1.05% or -280.85 points at 26583.42
- S&P down -0.90% or -26.82 points at 2953.56
- Nasdaq down -0.79% or -64.298 points at 8111.12