The Macro Trading Floor

Markets are caught between cross currents, and the thesis for a stronger USD / sticky inflation seems as valid as the thesis for gentle disinflation / slower growth. Brent and Alf discuss what the next big macro trade could be.

Want access to Alf's institutional macro research? Ping him (Alfonso Peccatiello) on Bloomberg or send an email at [email protected]

Want access to Brent's research notes? Ping him (Brent Donnelly) on Bloomberg or visit https://www.spectramarkets.com/am-fx/

Transcript: https://www.spectramarkets.com/tmtf-transcript-20feb25/

In this episode, Alf and Brent reflect on the upcoming ''Tariff Day'' and how to trade it. The duo shares their scenario-based approach covering multiple asset classes including bonds, FX and equities.

Alf can be reached via X (@MacroAlf) and on Bloomberg (Alfonso Peccatiello)

Brent can be reached via X (@@donnelly_brent) and on Bloomberg (Brent Donnelly)

Show notes: https://50in50.substack.com/p/trade-6-options-or-cash

Transcript: https://www.spectramarkets.com/tmtf-transcript-17jan25/

Alf and Brent discuss the big moves in UK bond markets and the drop in the UK Sterling: bond vigilantes are in action, but what next? They also focus on the upcoming tariff announcement and the impact on US bond markets, the US Dollar and equity markets.

Transcript: https://www.spectramarkets.com/tmtf-transcript-10jan25/

Powell delivered a super hawkish message: inflation remains sticky, and the Fed won’t cut rates as much as the market expected in 2025. The “Fed Put” is not there anymore - should investors go and buy their own puts?

Transcript: https://www.spectramarkets.com/tmtf-transcript-20dec24/

Alf and Brent discuss the US dilemma in 2025: should Trump be aggressive out of the gate with tariffs sacrificing growth for foreign policy victories, or should he focus on other priorities allowing Powell to cut rates and facilitate the refinancing of $7 trillion of maturing Treasuries? The duo also discussed the perils and benefits of leverage in trading and investing.

Do you want to ask questions to Brent and Alf?

Reach out to Alfonso Peccatiello and Brent Donnelly on Bloomberg.

Transcript: https://www.spectramarkets.com/tmtf-transcript-13dec24/

Alf and Brent resume the show by assessing how to approach Trump 2.0 from a macro trading perspective in 2025. They also discuss the ''Death of Europe'': is it happening, or is it an overcrowded narrative?

Trial for Alf's Institutional Research: https://forms.gle/25heFudTB4ouuJ1H6

Brent's Daily Newsletter: https://www.spectramarkets.com/

Transcript: https://www.spectramarkets.com/tmtf-transcript-06dec24/

In this week's episode, Brent and Alf discuss the implications of a Republican sweep. Markets reacted in a textbook way, but today they are busy unwinding most ''Trump trades''. Should we take Trump's agenda at face value and assume it's negative for bonds and positive for the USD? Or should we instead dig deeper and figure out what Trump really wants?

FREE trial to Alf's research: https://forms.gle/jF2nnD2VoNuQjem86

Check out Brent's research: https://www.spectramarkets.com/

Transcript: https://www.spectramarkets.com/tmtf-transcript-08nov24/

Heading into US elections, US bond markets are on fire: yields are selling off, the term premium is back in positive territory, and investors are worried the sell-off can extend further.

Alf and Brent discuss a framework to assess bond yields, the role of tariffs, how to look at the US Dollar and they also zoom in on Canada where the Central Bank has been forced to aggressively cut interest rates.

FREE trial to Alf's research: https://forms.gle/jF2nnD2VoNuQjem86

Check out Brent's research: https://www.spectramarkets.com/

Transcript: https://www.spectramarkets.com/tmtf-transcript-25oct24/

Alf and Brent discuss the recent sharp moves in US election polls and betting markets: Trump's odds are moving up, and so are the odds of a Red Sweep. Is the market fully incorporating these odds? Also, the duo discusses the possibility of persistent financial repression regardless of who prevails in US elections. Finally, they engage in a discussion about the importance of correlations for macro portfolios.

Want to be in touch with Alf? Ping Alfonso Peccatiello on Bloomberg or enroll in the two-weeks free trial of his institutional research: https://forms.gle/5GfSwfzovsFpCA5q7

Want to be in touch with Brent? Ping Brent Donnelly on Bloomberg or visit spectramarkets.com

Transcript: https://www.spectramarkets.com/tmtf-transcript-18oct24/

Alf and Brent discuss the most recent US macro data releases: the hurricane impacted jobless claims, and core inflation has surprised to the upside. Trump now seems to decidedly lead the polls, and his policies could be inflationary. Did the Fed make a mistake by cutting 50 bps? The duo also discusses the Saturday Chinese fiscal press conference, and how to handle seasonality in your trading framework.

Alf's Macro Research Trial (Free): https://forms.gle/6azecq2XhMW2ZFXa8

Brent's Newsletter: https://www.spectramarkets.com/

Transcript: https://www.spectramarkets.com/tmtf-transcript-11oct24/

EXCLUSIVE DISCOUNT TO ALF & BRENT CONFERENCE

https://www.spectramarkets.com/macro-roadmap-2025/

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Only for the first 100 users - first come, first serve!

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Alf and Brent discuss the many risks on the horizon: the Middle-East escalation, China following up (or not) with real economic stimulus, elections and more.

Today’s episode: https://www.spectramarkets.com/tmtf-transcript-04oct24/

The Chinese stimulus bazooka has been fired.

Chinese authorities have announced aggressive interest rate cuts, a 1 trillion yuan capital injection for Chinese banks, and they 

are also mentioning the magic words: fiscal stimulus.

As a result, stocks are soaring and commodities are rallying.

But - is it really going to work? And can China really afford such a stimulus?

Alf and Brent unpack this in today's show.

Elm's ''Crystal Ball'' Trading Game: https://elmwealth.com/crystal-ball-challenge/

Transcript: https://www.spectramarkets.com/tmtf-transcript-27sep2024/

Alf and Brent discuss the jumbo 50 bps Fed cut and the nuances Powell shared during the press conference. They look at historical parallels to derive how to best approach different asset classes with a specific focus on the USD. They also cover the Chinese economy which seems to be slowly imploding from within.

We are now also on Youtube, where you can see supporting charts and our bald heads.

https://youtu.be/o1iDoADS0c4

Transcript: https://www.spectramarkets.com/tmtf-transcript-20sep2024/

Alf and Brent discuss similarities and differences between the world and the macro cycle today versus the pre-pandemic period. While the cycle might look similar, should we not pay attention to the structural differences too? The duo moves on to discuss the aggressive bond market pricing and how to trade around that. Finally, they focus on the US Dollar: will it perform nicely or poorly if we get a recession?

Free trial to Alf's institutional macro research: https://forms.gle/yNU1vBqCqRXSvEHA7

Sign up to Brent's newsletter: https://www.spectramarkets.com/subscribe/

Transcript: https://www.spectramarkets.com/the-macro-trading-floor-transcript-13-september-2024/

Alf and Brent discuss recent developments in macro and labor market data, and debate whether the Fed will cut by 25 or 50 bps in September. Is the bond market overestimating the amount of upcoming cuts, or economic weakness will require the Fed to cut rates even more aggressively? They then move to investigate how long-term investing bias can negatively affect short-term oriented trading decisions, and how to measure consensus.

Free trial to Alf's Institutional Research: https://forms.gle/6bXTD5ApyrdvSv798

Subscribe to Brent's newsletter: https://www.spectramarkets.com/am-fx/

Commodities are the worst-performing asset class over the past 20 years:

https://www.mfs.com/content/dam/mfs-enterprise/mfscom/sales-tools/sales-ideas/mfsp_20yrsa_fly.pdf

Transcript: https://www.spectramarkets.com/the-macro-trading-floor-transcript-6-september-2024/

In this episode, Alf and Brent discuss how cross-asset pricing in bonds, FX and equity markets has rapidly changed in August and compare it with the hard economic reality: are there opportunities to be exploited? They then make a deep dive on the US Dollar, and finally cover a crucial trading framework topic: when and how to use options instead of linear structures to put up macro trades?

FREE TRIAL to Alf's Institutional Macro Research: https://www.tinyurl.com/FreeTrialResearch

Sign up to Brent's newsletter: www.spectramarkets.com/subscribe

Brent's dedicated piece on options vs linear trades: https://50in50.substack.com/p/trade-6-options-or-cash

Transcript link here: https://www.spectramarkets.com/the-macro-trading-floor-transcript-23-august-2024/

Alf and Brent reflect on the immense volatility hitting markets recently, and specifically on the unwind of carry trades: are we done here or is there more to come? Most importantly, they describe how to design and apply a risk management and position sizing framework so that when everybody panics you don't need to.

Want to reach out to Alf? Ping Alfonso Peccatiello on Bloomberg

Brent Donnelly can also be reached on Bloomberg, or via spectramarkets.com

Transcript link here: https://www.spectramarkets.com/the-macro-trading-floor-transcript-12-august-2024/

Alf and Brent reflect on the massive bond market rally and the explosive move in the Japanese Yen - what’s next for macro?

To contact Alf: send him an email at [email protected] or contact him on Bloomberg (Alfonso Peccatiello)

To contact Brent: ping him on Bloomberg (Brent Donnelly) or go on http://www.spectramarkets.com/

Brent’s piece on positioning: https://50in50.substack.com/p/trade-11-sentiment-and-positioning

Transcript: https://www.spectramarkets.com/the-macro-trading-floor-transcript-02-august-2024/

This week, Alf and Brent discuss the brutal equity market sell-off: is it due to macro tectonic shifts, a reassessment of political risks or an unwind of crowded trades?

The duo digs deep trying to connect the dots, and they also discuss a trading framework around this large volatility events.

Alf and Brent look into various ''Trump trades'' now that the odds of a Trump election and Republican sweep have increased: is there still juice left? And where? Specifically, they also reflect on the use of options as macro traders.

Want to see Alf's Cheap Optionality Monitor?

Ping him (Alfonso Peccatiello) on Bloomberg

And take advantage of Brent's course offer!

Think Like a Market Professional:

www.spectramarkets.com/school - use code JULY24 for $500 off

Stuff mentioned during the podcast:

GS piece on AI    https://www.goldmansachs.com/intelligence/pages/gs-research/gen-ai-too-much-spend-too-little-benefit/report.pdf?ref=wheresyoured.at

Ed Zitron pieces on AI

https://www.wheresyoured.at/pop-culture/

https://www.wheresyoured.at/put-up-or-shut-up/

White House statement on Biden (find the spelling error)

https://www.whitehouse.gov/briefing-room/statements-releases/2024/07/17/statement-from-press-secretary-karine-jean-pierre-3/