Tuesday, August 16, 2016


Billy the Dud was at it again.  The President of the New York Fed just can't keep himself off TV to the point that if he and Charlie Schumer ever wound up in the same room when the red light went on it's 6-5 either side as to who would wind up dead.

Anyway, the guy is good for laughs.  Says he today that a rate rise in September should not be ruled out and the Fed will in no way be influenced by the upcoming election.  The guy is funnier than Jack Benny.  The most politicized Fed in history is going to raise ra...ah, hell it doesn't even deserve consideration, except by the equity boys who sold the thing off today ostensibly fearing a rate hike.  More like the entire market was pretty toppy to begin with and volume looked like a day from the 1960ies. with the Hampton's packed to the gills or so it seemed to me.

On the other hand, the real action--as predicted I might add--is in the currency markets with the short position in Sterling believed to be at a 31 year high.  The Pound closed at 1.30, up from yesterday's 1.2980 but that was due entirely to a bit of shot covering in the end.  Speculation has it at 1.26 on the high side to 1.19-20 at the low by year end.  "There are no buyers" I was told today which tells me that if you are short, get square because the downside to that position is enormous.  Mr. Carney is a bit of an unknown but the history of the Old Lady has been one of not enjoying the sight of her currency being trashed despite the value to the U.K. export business which is becoming even more important.  Further, any positive news on a variety of fronts...especially any relating to BREXIT could produce a rout and one can be practically certain that the Bank will be in no mood to stabilize things.  OK, OK I admit it: that's what I hope will happen but I don't think I'm far off on the basic premise that this is way overdone.

Anyway, it has been a good day for chuckles and happy thoughts.  Oh. by the by, the rain?  Yep, we got a bit last evening and into the night.  Ten Inches to be exact.  Not a cloud in the sky as a write this.  Welcome to the Fly-Over Zone!   Vaughn is laughing too.

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