All Macro-Thematic Trend Reports:

Treasury “said the quiet part out loud” last week…don’t miss the forest for the trees (FFTT, 11/7/23)

I just rewatched the movie “The Big Short” two nights ago with my wife. So much of it rhymes with what’s happening now, except the AAA rating that is bullsh*t is the risk-free collateral of the whole system (i.e., USTs and western sovereign debt.)     -FFTT, to a hedge fund manager friend, this week Then it comes to be, that the soothing light at the end of your tunnel, is just a freight train coming your

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The “Soros Imperial Dollar Cycle”, the US Insolvency Ratio, and the Dollar (FFTT, 10/31/23)

The label Imperial Dollar goes back to Soros (1984).  In an article on the Financial Times (Soros (1984)), he developed his argument by referring to an irreconcilable policy objective…High budget deficit leads to relatively higher real interest rates. Higher interest rates attract funds from the rest of the world. High budget deficit stimulates the economy and along with high interest rates that tends to keep the dollar strong. The recovery, combined with a high exchange

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The Fed’s first Quasi-Fiscal Deficit in 110 years, and the August-October 2023 UST market selloff (FFTT, 10/25/23

One of the possibilities that’s driving the long-term bond yields higher is concerns about inflation risk related to the cumulative effect of government debt. So we don’t know exactly why the long-term bond yields have gone up, but certainly that’s one of the possibilities that people are talking about and that’s related to this concept of fiscal dominance that you mentioned. The possibility that the cumulative effect of deficits will cause money printing to result

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