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Hot stuff not so hotThe AI proxy, NYFANG, has been the hottest stuff around in 2023. It closed below the 21 day moving average today, by a margin not seen since late April. 50 day is still way lower...Massive tech inflowsThe inverse to early 2023. Long tech here is not unique...Retail - back with a vengeanceRetail have been very active during the squeeze. Goldman's Marshall and team show the exposion of the high retail sentiment basket. They also point that a big part of the flow has come from options chasing: "... put-call skew in single stock have shown unusually large call option buying pressure."Not a typoSoc Gen's Edwards shows that net interest payments have collapsed, despite the surge in rates. He writes: "Something very strange has happened, and it helps explain the recession’s tardiness."The madness chart of the dayImpressive chart via Edwards explaining why the recession refuses to kick in (yet). He writes: "We have concluded that a sizeable proportion of huge, fixed rate borrowings during 2020/21 still survives on company balance sheets in variable rate deposits. Companies have effectively played the yield curve in reverse and become net beneficiaries of higher rates, adding 5% to profits over the last year instead of deducting 10%+ from profits as usual . Hence it’s not just ‘Greedflation’ that has boosted US profit margins and delayed the recession. Interest rates simply aren’t working as they once did. It is indeed a mad, mad world."
Yes, but I'm not astute enough to understand what it is. Any ideas you want to share.
