Top Tweets for #HyperStagFlation

🚨🌍🇬🇧 British Wholesaler explains the insane exponential prices rises being experienced in just the last week "This time last week I paid £9.90 for a Box of Spanish Broccoli- this week £24per Box" "Morocco Tomato's - £7.00 per box, this morning £20.00 per Box" "Lettuce has gone from £7.00 to £13.00" "These shortages are caused by Bad Weather..." Incoming Engineered Food Shortages....

When Gold Buys This Much Oil, the Market Is Bracing for Something This chart is really just asking how much oil can you buy with gold? And at about 0.51 grams per barrel, the answer right now is a lot. That’s extreme. Historically, you don’t see oil this cheap relative to gold unless something is off in the real economy or people are paying up for insurance. Oil is tied to actual demand with shipping, travel, production. Gold is tied to trust, uncertainty, and the long arc of policy. When gold buys this much oil, the market is leaning toward protection over growth. Look at the past troughs and the pattern is pretty consistent. These lows show up around demand shocks or financial stress like in the late 90s in Asia, 2008, 2020. Oil gets hit first because demand weakens, while gold holds up because uncertainty doesn’t fade as fast as inflation. That fits the current backdrop if a global slowdown is coming. The key thing, though, is that these extremes rarely last forever. Either recession deepens and oil stays suppressed longer than people expect, or policy easing, supply risk, or recovery flips the script and oil snaps back hard. Historically, when this ratio turns, it tends to do so fast and that’s what makes this level less a resting place and more a sign that something is about to change.

🦔The bond market's reaction to Fed rate cuts has been highly unusual. Ten-year Treasury yields have risen nearly half a percentage point to 4.1% since the Fed started cutting in September, and 30-year yields are up over 0.8 percentage points. Normally when the Fed cuts short-term rates, long-term bond yields follow. The Fed has cut 1.5 percentage points to 3.75%-4%, with another quarter-point cut expected Wednesday. Why It's Happening Markets priced in Fed cuts well before they started, with 10-year yields peaking in late 2023. By cutting rates while inflation remains elevated, the Fed is reducing recession risk, limiting how much yields can fall. The term premium (extra yield investors demand for long-term bonds) has risen nearly a full percentage point since cuts began. Bond traders worry the Fed is cutting too far with inflation still above 2%. There's concern Trump will pressure the Fed to keep cutting even when it's not warranted. My Take The bond market is saying they don't believe inflation is under control. When the Fed lowers rates and bond yields rise anyway, someone's wrong. Core PCE is at 2.8%, still 40% above the Fed's 2% target, and the Fed is cutting into that environment. Bond investors are demanding higher yields because they see risk. The term premium rising nearly a full percentage point means they want more compensation for holding long-term debt because of inflation concerns and the massive federal debt load. Here's the paradox: the Fed cuts rates to help the economy, but if bond yields rise in response, borrowing costs for consumers and businesses go up anyway. Mortgage rates, credit cards, and corporate borrowing all tie to Treasury yields. The Fed is losing control of the long end of the curve, which is what actually matters for most people's borrowing costs. Hedgie🤗

Just some ridiculous bad results from Chicago ISM - leading indicator regional business barometer. Big drop in orders. Huge drop in backlogs to lowest since '09. Employment index lowest since '09. Not a single respondent reported adding to employment. NOT ONE. https://t.co/ys0d81f7xr