FaireCapitalist

⚡️Here’s the straight signal: The yen carry trade unwind was the trigger. Not the sole cause, but the ignition point that lit dry powder already lining the system. Let’s break it down clearly and cut through all the noise: 1. The system was already brittle. Liquidity was maxed out. Leverage was layered - corporate, sovereign, shadow-bank, crypto. Everyone was borrowing short and betting long, assuming the yen would stay weak and the Fed would pivot soon. That’s a setup that needs perfect conditions to survive. 2. The yen move cracked the facade. When USD/JPY snapped lower, even if it looked “tiny” on paper, it was a nuke structurally. Why? Because the yen isn’t just a currency - it’s the world’s cheapest collateral source. Billions are borrowed in yen to fund everything from Treasuries to Bitcoin. So when the yen strengthens, all those trades go underwater at once. That’s a forced unwind. Not sentiment - mechanics. And because this is all stacked leverage, the effect compounds fast. One small FX move equals billions in margin calls. 3. The reflexive feedback loop ignited. Once the unwind began, funds had to sell anything liquid to cover losses. That means U.S. equities, BTC, high-beta names - exactly what sold off. And when those prices drop, it feeds right back into the same risk models - forcing more selling. That’s not “investors panicking.” That’s autonomous deleveraging - algorithms, collateral models, risk desks all firing at once. 4. The deeper truth - the carry trade is the hidden denominator. The yen is like a barometer of global risk appetite. When it strengthens, it means liquidity is being pulled back into Japan. That’s the same as global tightening - even before central banks say a word. So yes, Japan is the canary. But this isn’t just about Japan. It’s about the global system’s dependence on low-yield debt and synthetic liquidity. 5. My final read This wasn’t a random flash crash. This was a structural tremor. The kind that happens when the world’s hidden funding mechanism starts to reverse direction. You can think of it like this: The yen carry trade was the quiet heartbeat of the post-COVID bull market. And you just watched it skip a beat. That’s why BTC and SPY dumped almost in sync. That’s why volatility spiked before the news cycle caught up. It wasn’t sentiment. It was plumbing. This was the first visible crack in the global liquidity wall. A carry trade unwind was the spark. The broader crash was the fire racing through leverage-dry grass. And if the yen keeps strengthening, that wasn’t the end…it was just the opening shudder.

Misinformation on X you may believe. While tariffs are taxes on imports, they don’t always translate directly into a 1:1 consumer cost increase. Companies may absorb some costs, adjust supply chains, or find alternative suppliers. The actual impact depends on industry dynamics, competitive pressures, and consumer demand elasticity.

DeepSeek/AI I don't know how serious this DeepSeek thing is. However, one thing is for sure, a potentially much more efficient way to build AI could endanger a massive CapEx wave of hyperscalers. -> This year alone, CapEx is expected to be north of $240 billion!

The "Fed pivot" is officially DEAD: Stocks are crashing after the US added nearly 100,000 MORE jobs than expected in December. The unemployment FELL to 4.1% just after the Fed said the labor market was "weakening." So, why are stocks crashing? Let us explain. (a thread)

This is interesting: The Walmart Recession Signal has jumped to the highest level since the 2020 pandemic. This is a recession indicator measured by Walmart's stock price, $WMT, divided by the S&P Global Luxury Index of luxury goods stocks. The gauge has almost doubled this year, as $WMT has risen 83%, while the S&P Global Luxury Index has remained unchanged year-to-date. In previous economic cycles, such a significant divergence signaled a recession was coming. Is the US economy headed for a recession?

Buffett’s $325 Billion Cash Hoard Is an Early Warning Signal bloomberg.com/opinion/articl…

☘️It's not the speed, It's the clarity of each note. Brilliant 👏👏💖💖 🌠🌷𝑩𝒆𝒆𝒕𝒉𝒐𝒗𝒆𝒏 "𝑴𝒐𝒐𝒏𝒍𝒊𝒈𝒉𝒕" 𝑺𝒐𝒏𝒂𝒕𝒂, 𝑰𝑰𝑰 "𝑷𝒓𝒆𝒔𝒕𝒐 𝑨𝒈𝒊𝒕𝒂𝒕𝒐" 𝑽𝒂𝒍𝒆𝒏𝒕𝒊𝒏𝒂 𝑳𝒊𝒔𝒊𝒕𝒔𝒂

A USER'S GUIDE TO RESTRUCTURING THE GLOBAL TRADING SYSTEM As markets look forward to a second Trump Admin, there are lots of bad predictions that tariffs will cause horrible inflation, or the President can't affect the dollar. Both are false. /1 hudsonbaycapital.com/documen…

Vivek Ramaswamy, 18 years old. his High School Graduation Speech of 2003.

$AAPL "Forever Multiple Expansion" story: FY22 = $6.11 EPS w/ stock at $140 FY23 = $6.13 EPS w/ stock at $171 FY24 = $6.08 EPS w/ stock at $225 And that's with -5.5% reduction in shares outstanding over 2 years from buybacks.

Bonds down and Oil down. Most people would not have predicted that. Except our Geoffrey @GraphCall !! In monetary dominance, both Oil and Yields down come from the same source. In fiscal dominance, when there is too much supply on the Treasury side while there is less demand for USD and UST - BECAUSE of less demand for petrodollar and oil - Oil price can fall AS yields rise. 🧠🤓

Sure, to validate a hanging man candle and confirm its bearish implications, follow these steps: 1. Ensure the hanging man appears after a clear uptrend to suggest a potential reversal. 2. Check the trading volume associated with the hanging man. Higher volume during its formation strengthens the pattern's validity. 3. Check the next candle(s) after the hanging man: - A bearish candle confirms that sellers are in control. - If it closes below the hanging man’s body, it adds further validation. 4. Look for other indicators, such as a decline in the Relative Strength Index (RSI) or other bearish patterns. 5. Assess overall market sentiment. Negative news can reinforce it. 6. Support Levels: Verify that the hanging man is near a significant resistance level, increasing the probability of a reversal. The chart for $AAPL complies with 1, 3, 4, 5, and 6; when people use S/R levels.

Listening to Newmont conference call now. I'm disgusted. Appears to me they bought a lot of problems when they acquired the Newcrest mines. In addition to Q3 miss, lowered 2025 guidance. I'm out - though I may be premature - as they're guiding to a strong Q4 and they do have a $2B buyback add. Newmont's problems appear to be almost wholly company specific, though as the industry leader, their miserable performance is hurting the entire group (GDX -3.4% today). I assume next week's reports from the well-managed miners will provide a very different story for the industry.

Bear steepening and term premiums rising is the market saying both "the US government deficits are out of control and won't be fixed regardless of who runs the country" and "the Fed isn't going to get inflation down to 2% because it is cutting into an economy that doesn't need accommodation."

My view on precious metals/bitcoin rip today: Markets are saying, Hey Powell, you are kind of screwing this up here a bit with your 50bps start to the cutting cycle. With this policy and your rate cutting intentions, you aren't bringing inflation back to 2% in your timeline and you seem not to care about that right now at all. So we are going to search for the pricing and financial conditions environment that starts to bother you as animal spirits keep going and inflation expectations keep rising. Where is the Fed's "call" struck?

The bond market is revolting against the Fed This morning, yields on the U.S. 10-year bond soared over 4%. This continues a non-stop rise in yields following the Fed’s 50 basis point rate cut on September 18. Normally, long term rates follow the path of interest rates in the overnight lending market, which the Fed controls. But this isn't a normal environment. Consider last Friday’s "blowout" jobs report, which was entirely driven by the biggest government hiring spree on record outside of COVID-19. Whoever believes our economy is strong, must think borrowing unsustainable amounts of money, printing money to pay for those loans, and then hiring people to do wasteful government jobs is the path to prosperity. It isn’t. The U.S. government is running deficits equal to 6% of GDP, and only generating 3% economic growth. In other words, if you remove government spending from the equation, America's economy is shrinking. We are on our way to a Soviet-like collapse in our economy as more and more of everything we do – including our jobs – are controlled by the government. Mr. Market is starting to sniff this out. That’s why investors are dumping Treasuries and flooding into gold, stocks, and real estate at record high prices. Meanwhile, we’re witnessing an entire presidential election campaign without either major party bothering to address the single most important issue at stake in our country: America’s unsustainable debt burden and the coming insolvency of the federal government. It is only a matter of time now until, one day, the U.S. Treasury market suddenly realizes that no amount of printing will stop the collapse: there will be “no bid” for our country’s bonds. And on that day, everything you think you knew about America will be completely gone.

An aggressive global easing is here without a global slowdown or any stress in asset markets. Such Over Easy policy has been pursued in the past by individual countries, but has never been run at a global scale. Thread.