Thank you Florian, great article, much appreciate your views. I have difficulties trading the short term market swings, and thus try to focus more on the broader picture. It looks like FED is focused on bringing down inflation and they will continue hiking until unemployment gets higher or something breaks in the market, the second alternative having IMO higher probability. But what then? If Fed rates are at 4 %, you see the Fed cutting rates? Or they will try to keep rates up and intervene with QE? Do you expect then risk assets to rally hard with 4 % rates (FANG stuff) or you would go all in in inflation regime assets (energy, ags, (precious) metals?
I would also be interested in your opinion on the German real estate market. Do you expect prices to come down hard in the very expensive regions (e.g. Munich, Stuttgart, Frankfurt, Hamburg, etc)? Most people bought with fixed rates for at a least 10-15 years. Maybe the market trends sideways, slightly down for a while? To have a sharp correction I think unemployment would have to rise a lot, so people are forced to sell in the downturn. Any comments are much appreciated!
Oct 4, 2022·edited Oct 4, 2022Liked by Florian Kronawitter
great analysis...
I just don't have the mental fortitude to play either long or short...given a the extreme moves in the market (especially 10/3-4), I'm happy to sit to the side and watch the fireworks...
the move up just doesn't make sense...what is the thesis to drive indices up over the past two days, especially on lower volume? If volume is lower today, especially after a gap-up, then I've got nothing and can only conclude market participants have gone nuts...or the PPT has gone full retard and pushing the bid...
To me, it's just "buy the rumor..."
in short, I agree with your thesis...always a great read!
Florian, thanks for the always insightful and deep analysis. When you consider longs in Oil in anticipating China reopening are you going in EPs or Oilfield Services? I see a better opportunity now in Services since eventually Capex must increase rather sooner than later.
Thank you Florian, great article, much appreciate your views. I have difficulties trading the short term market swings, and thus try to focus more on the broader picture. It looks like FED is focused on bringing down inflation and they will continue hiking until unemployment gets higher or something breaks in the market, the second alternative having IMO higher probability. But what then? If Fed rates are at 4 %, you see the Fed cutting rates? Or they will try to keep rates up and intervene with QE? Do you expect then risk assets to rally hard with 4 % rates (FANG stuff) or you would go all in in inflation regime assets (energy, ags, (precious) metals?
I would also be interested in your opinion on the German real estate market. Do you expect prices to come down hard in the very expensive regions (e.g. Munich, Stuttgart, Frankfurt, Hamburg, etc)? Most people bought with fixed rates for at a least 10-15 years. Maybe the market trends sideways, slightly down for a while? To have a sharp correction I think unemployment would have to rise a lot, so people are forced to sell in the downturn. Any comments are much appreciated!
great analysis...
I just don't have the mental fortitude to play either long or short...given a the extreme moves in the market (especially 10/3-4), I'm happy to sit to the side and watch the fireworks...
the move up just doesn't make sense...what is the thesis to drive indices up over the past two days, especially on lower volume? If volume is lower today, especially after a gap-up, then I've got nothing and can only conclude market participants have gone nuts...or the PPT has gone full retard and pushing the bid...
To me, it's just "buy the rumor..."
in short, I agree with your thesis...always a great read!
I don't get why people are surprised when we have 2 green days in a sea of red. It can't be one way. Zoom out and see that the trend is intact.
Florian, thanks for the always insightful and deep analysis. When you consider longs in Oil in anticipating China reopening are you going in EPs or Oilfield Services? I see a better opportunity now in Services since eventually Capex must increase rather sooner than later.
Splendid analysis, for which many thanks indeed.