Timeless

[Timeless @ceothree]

@vwaptrader1 @TradingSynHQ how do you determine what "size" selling is? What do you look for?

[zerohedge @zerohedge]

The only thing that was propping up the Kospi in the past months is ending: the frenzied, record buyback spree by Samsung and SK Hynix is now over, earlier than expected, as it was running far faster than expected: 55 trillion won in stock bought back. Kospi closed at the lows.

[Timeless @ceothree]

@BowTiedLobster Why does the president want to get one over on Wall Street? Internal power struggle?

[Kantro @MichaelKantro]

If earnings were not booming stocks would be much lower today. Hard to see earnings pulling the market up at this point. in the last several months, rising earnings have been largely offset with lower PEs. The higher rates go the faster P/Es are likely to fall for each incremental BP. And at some point down the road that green line of earnings strength is going to see its slope flatten. Being bullish on earnings is no longer enough IMO.

[Timeless @ceothree]

@holeyprofit What's your time horizon for a move like this?

[Pi-Fi @gherkinit]

https://t.co/EAchuOD4F4

[Austin Lieberman @LiebermanAustin]

The OPEC oil embargo of ‘73-‘74 sparked massive inflation. Oil jumped from $24 to $64 a barrel in a year.

CPI went from 3.2% to 11% from ‘72 - ‘74. By 1980, inflation was still 13.5%

Paul Volcker raised the fed funds rate to 20% in ‘80 and inflation dropped to 3.2% by ‘83

[David Sacks @DavidSacks]

Dario has written that we need to “pace the frontier,” and Sam has agreed. People may be surprised by my response: go ahead.

You guys are the frontier. By any reasonable metric — market share, revenue growth, model capability — the two of you have a duopoly on frontier intelligence. You’ve also claimed the lead is widening because of recursive self-improvement.

I don’t see what you see in the lab. If the unreleased models are scary enough that you think you should slow down, I support your decision to be responsible.

But stop pretending you need anyone else’s permission. Stop pretending antitrust law has to be suspended so you can form a cartel. Stop pretending you need a regulatory approval process that supersedes product liability. Stop pretending METR is independent when it is intertwined with Anthropic’s investors and staff. Stop pretending you need those same evaluators to police competitors who aren’t even at the frontier.

Most of all, stop pretending the motivation to slow down is purely altruistic. You face massive product-liability exposure if your products enable a truly damaging cyberattack. The market already punishes models that behave in unpredictable or unauthorized ways. After the Hugging Face episode, it is simply good business for OpenAI and Anthropic to trade some raw power for reliability and predictability. Call it alignment if you want. It is also just giving customers what they want.

Pacing the frontier would also create breathing room for a more intelligent conversation about regulation than Bernie Sanders’ “shut it all down.” China is very unlikely to join a global agreement, as you know, and that has to be taken into account as well.

So go ahead and pace the frontier. You are the ones setting it. The easiest way not to build superintelligence is for you to agree not to build it. Demanding your preferred regulatory framework as the price of that will look like blackmail of the public and the political system. So just do it.

If you do, you’ll buy goodwill for the next conversation. If you don’t, we’ll know this was just another bid for regulatory capture — or an election-season psyop.

[HealthRanger @HealthRanger]

After today's events, I'm rooting harder than ever for open source to succeed.

I'm also rooting harder than ever for U.S. frontier AI labs to financially collapse into bankruptcy and ruin.

Why? Because the danger to our world isn't AI itself. The real danger is AI being centrally controlled by the kind of scheming, nefarious, dishonest cretins who would engineered an "AI doom op" to try to scare everybody into supporting government controls over AI models.

THOSE PEOPLE are the danger to humanity. And they want monopoly control over all AI technology. Not to save humanity, but to ENSLAVE humanity.

In a future with AI, our only shot at human freedom is through decentralized, open source AI. And that's exactly what these frontier AI labs are now trying to stop.

[Timeless @ceothree]

@holeyprofit But here’s the thing: are you doing good work purely for Self, or in Service to the world?
If you’re doing so in service, then proper marketing becomes an obligation and a responsibility. That’s how you can help more people and get paid (even more) along the way.

[Timeless @ceothree]

@holeyprofit This is the same issue as companies that only focus on building a great product without attention to marketing. I’m a fan of your work, but I do think if you want more reach you’ll need to market yourself in more easily digestible bits.

[Uncle Milty’s Ghost @his_eminence_j]

I’ve said for a while that this would not be some sort of mythical interest rate-driven recession or a market pullback that results in recession. None of those things ever really happen.

This is going to be a demand destruction recession.

And that’s why it will be so insidious.

We’re not dealing with a few bank failures, causing a liquidity crisis (at least not yet). We’re dealing with a consumer that is tapped out and falling behind on areas of basic living.

And the assets that most consumers have, that have inflated in value over the last few years (mainly their house and their 401k), are not accessible. They’re not liquid. They’re paper gains only, which will evaporate as both the housing and equity bubbles pop.

Today’s restaurant report places the industry deep, deep into the worst parts of the Great Recession, and we are just getting started. Entire retail chains that rely on low- and middle-income consumers are filing for bankruptcy. Layoffs are way up. Car prices are dropping and loan and credit card delinquency rates are spiking.

The mortgage/real estate industry is already devastated, with so many agents leaving the business over the last year that we’re back to levels not seen since housing bottomed in 2014. CRE continues to crash. And housing starts and new permit pulls are at multi-decade lows. Office vacancy rates in most major cities are above 25%.

General unemployment has made the letter “J“ on the graph that is required before each recession, and the Sahm rule triggered weeks ago.

I don’t write all of this to doom and gloom, and before some idiot starts accusing me of being a bear, I’m not that either.

I’m a realist. I want people to understand the economic reality because the market is violently detached from it and the pullback could be something more like 40-50% than the 20–30% I originally thought.

I really thought the pullback in August was the market coming to its senses. It has not.

A rate drop this week will endure the same lag effect that a rate increase has. That means that the economy, already racing into a recessionary brick wall, will continue its forward momentum.

They couldn’t drop rates enough this week to avoid it, because they can’t avoid the lag effect.

And with core and super core CPI stuck at about 3.5% for months now, I firmly believe this pivot is still too soon and we will see an increase in inflation going into 2025. Only a very hard landing will finish inflation when rates are below neutral and QE has resumed.

Protect what you’ve worked so hard for , it’s your future that you invest for.

Things will get better, but we must endure what’s coming and stop deluding ourselves that we can keep walking between the economic raindrops and not get wet.

The only way out of this now, is through it. There’s no way the Fed will be able to avoid it.

Just be smarter than the average guy on Twitter. It’s your life’s work at stake. 🙏

[zerohedge @zerohedge]

On Wednesday, the Bureau of Labor Statistics will downward revise jobs for the April 2023-March 2024 period by up to 1 million. This means that all "beats" recorded in the past year will have been misses and the US job market is in far worse shape than the admin would admit.

[Capital Misallocation @BenBrey]

In late stage Carry Regime, it’s all one trade - winning side or losing side are simply symmetric.

QQQ - you look like the “outside cat” what you doing out there buddy?

[Nobody Special @JG_Nuke]

The Party told you to reject the evidence of your eyes and ears. It was their final, most essential command.

[50ptMAE @50ptMAE]

#BoJ and Ueda have been masterful. Contrary to popular belief these guys have been navigating the current economic conditions perfectly.

You must remember they are dealt with an impossible task. People in Japan just aren't having enough babies. This has resulted in a sickly economy comprised of all older people and very low productivity.

Consequently they must stimulate endlessly via monetary policy. This lead to decades of ZIRP and ever since the 2022 inflation super cycle post wide that has blown out yield spreads (US t-bills yielding 4.5%+, which is 4.5% more than Japan charges to borrow).

This has lead to $USDJPY to go no-offer for literally years. Who is willing to short USDJPY when you are losing 4.5% just to hold the position and knowing you are going against MASSIVE momentum? Almost nobody.

So a historic amount of yen shorts built up, comprised equally of real money long USDJPY and now a huge amount of speculators, moms guys, CTA trend followers.

BoJ knows their currency is on a death spiral, least they can do is slow the descent, which is wipe out Specs.

They know they can hike, but their economy/stock market can't stand it. There is also political pressure to hike as Japan is seeing nascent signs of inflation and the weak Yen is heavily felt by the consumer. They know they can't really hike, because the economy is too weak, but they are also facing political pressure from the government to "do something" about inflation.

They decided to hike once and signal Uber-hawkishly. This crashed the Nikkei of course and global markets to an extent.

I believe they knew this was going to happen but did this anyways because it accomplished two things.

1. It completely wiped out the USDJPY longs, stopping the currency death spiral, taking it back 20 big figures. It also greatly deters any future yen spec shorts for the foreseeable future.
2. They cover their own ass. Ueda can call the PM and say, "hey obviously we can't hike, look at the Nikkei last time we tried". They are absolved of their responsibility.

There is no winning for them. There is no monetary policy solution to Japanese people not having enough babies. That is a much bigger problem with no apparent solution. All they are tasked with is slowing the descent of their currency, and fighting off inflation as best as they can before the inevitable arises or the next guy has to deal with it.

Moving forward, if inflation continues to persist, their best chance to hike again will likely be when the whole global market falls into a down cycle as they won't be blamed or held responsible for the downturn as its already happening everywhere.

I see alot of hubris on this website, Ueda has a PhD from MiT. He's a hell of a lot smarter than you or I and anyone who believe otherwise is just delusional. These guys know EXACTLY what they are doing before they do it and almost everything they do is fully intentional. The fin twitters who have $1,000 robin hood accounts working part time at 7-11 calling Central bankers naive or foolish is pure comedy. Hubris at its finest.

$SPY $SPX $QQQ

[Joe Weisenthal @TheStalwart]

Even with the selloff, $NVDA has added $1.4 trillion in market cap over the last year.

Meanwhile, Bitcoin's total market cap $1 trillion.

So in other words, Nvidia has created more wealth for investors in just one year than Bitcoin has in 15 years.

[Campbell @abcampbell]

TIME TO HEDGE?

Today we’re going to take a break from the 100-year time horizon stuff and serve up something tactical.

I get a lot of people saying “Campbell, we love how you predicted Evergrande, Taiwan, Lebanon, Vladivostok, Tiktok, Gold in China, shipping cost inflation, bonds in the stocks, but that’s yesterday’s news! We want alpha!”

Actually no one says these things. But hey whatever keeps you writing in the middle of a fundraise Campbell.

So today we’re going to delve into the wonderful world of options and make the case that: equity optionality is too cheap, it’s NVidia’s fault, so it may be time to load the boat (if that’s your thing). I myself will be buying put options (1yr out, 5-10% below spot) sometime after the open of today’s market.

The Market is Very Concentrated

This week NVidia passed Microsoft and Apple for the crown of most valuable listed company on earth. Along the way the three stocks now make up more than 20% of the entire index.

This is a pretty extreme amount of concentration, going back as far as we could find data.
What that means is that more and more of ‘the market’ is just ‘what did NVidia do today?”

For fans of diversification, this alone is no bueno. If you are looking for a representative portfolio of American stocks, you might not want 20% of your portfolio is just three stocks.

However, that’s not the point of this piece. That’s the nature of stocks: “run your winners, cut your losers” etc etc.

No, the reason for the piece is what this concentration is doing to the price of volatility for stocks, and in particular, what it’s doing to the price of correlation.

[Quartr @Quartr_App]

Peter Lynch's Cocktail Party Theory

What stage are we in now?

[Nikola @tesla_trading97]

@bellsedge @tradermatt @Trader_Dante