U.S. Bonds Are A Tactical Short

We published a tectically bearish view on US bonds today on Seeking Alpha. Below are some excerpts: With the short-term downtrend giving way in recent trading, 10-year yields look set to once again recouple with their fundamental drivers and head higher. The rise in Swiss and Japanese yields to multi-month highs could be a canary…

MXN: Bargain Hunting

We published a bullish view on the Mexican Peso today on Seeking Alpha. Below are some excerpts: The Mexican peso looks highly attractive from a real yield perspective with average Mexican real yields currently 3.8pp higher than the U.S. Such a large divergence in real interest rate expectations should attract foreign investors into Mexico’s local…

EM FX Deeply Undervalued

We published a bullish view on Emerging Market FX today on Seeking Alpha. Below are some excerpts:   The CEW WisdomTree Emerging Currency ETF is at its weakest level since 2000 in real terms. The EM FX basket has weakened despite a surge in real and nominal interest rate differentials suggesting that the risk premium…

Dollar Shortage A Red Herring

We published a bearish view on the US Dollar today on Seeking Alpha. Below are some excerpts: The bullish dollar argument rests on the idea of a chronic shortage in the offshore eurodollar market as demand for dollars for loan and debt repayments surges. Our take is that the apparent shortage of dollars reflects the…

UK Stocks Priced For A Depression

We published a bullish view on UK Stocks today on Seeking Alpha. Below are some excerpts: U.K. stocks are now trading at an extreme valuation discount relative to historical averages, global equity averages, and domestic bonds. Over the past 50 years when the dividend yield has been at current levels, annual subsequent returns over the…

TIPS Offer Great Risk-Reward Trade-Off

We published a bullish view on U.S. Inflation-Linked Bonds today on Seeking Alpha. Below are some excerpts: The sell-off in inflation-linked government bonds has provided a great opportunity for investors looking for a risk-free positive nominal and real return with the potential for capital gains. We see 30-year TIPS as a way to take advantage…

GBP Could Be Set For A Major Rally

We published a bullish view on the British Pound today on Seeking Alpha. Below are some excerpts: GBPUSD looks to be breaking out of its short-term downtrend and real yield spreads suggest the paid should be trading significantly higher. There is potential for a virtuous cycle where a stronger pound reduces inflation expectations which in…