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    Net USD positioning
    Net USD positioning
    Source: Haver

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    Fiscal thrust
    Fiscal thrust
    Source: JPM
    Sharpe Kings
    Sharpe Kings
    Source: Goldman
    Will EM bond yields not print significant new low?

    EM bond yield have declined to 5.3%, close to 2013 lows

    Will EM bond yields not print significant new low?
    Source: JPM
    Banking on Biden

    Polls still have VP Biden as the current front runner and frankly so does the market. Since June 8th the Morgan Stanley Democratic Policy Pair has outperformed the MS Republican Policy Pair by ~35%

    MS Customs Baskets
    Market forgot the "safeword"

    The performance of safe assets this September has been the worst in at least a decade during a major equity market drawdown

    Chart: Returns on defensive and quasi-defensive assets during largest global equity drawdowns since the Global Financial Crisis. X axis shows dates of all drawdowns in MSCI AWCI of 5% or more.

    Market forgot the "safeword"
    Source: JPM
    shorts being put back on

    Quantity-On-Loan on individual US stocks and Non-US stocks (excluding ETFs)

    On loan value as a % Lendable Value. Last obs is for 23rd Sep 2020.

    shorts being put back on
    Source: JPM
    less pockets of over-extension

    "The correction in September to-date has cleared many of the pockets of overextension that were evident in late August; momentum traders are now more neutral US equities, and short interest at the individual stock level has risen to levels seen in mid-2020 suggesting scope for further de-risking has been reduced.

    Moreover, the equity weights of global non-bank investors, which were still below post-Lehman averages in end-August, are now further diminished"

    Chart: Average of the z scores of JPM short and long lookback period Momentum Signals for Nasdaq and S&P500

    less pockets of over-extension
    Source: Flows & Liquidty
    Sentiment not stretched anymore

    GS Sentiment Indicator measures stock positioning across retail, institutional, and foreign investors versus the past 12 months. Readings below -1.0 or above +1.0 indicate extreme positions that are significant in predicting future return

    Sentiment not stretched anymore
    Source: Goldman
    Debt, Schmedt. Italian edition.

    In this brave new world, appears debt don't matter. As Holger Zschaepitzwrites"Looks as if debt does not matter anymore: Italy's 30y yields have hit fresh low this week at 1.75% despite rising debt. Italy debt/GDP on course to 160% when the new draft budget is presented early next week up from 135% at the end of 2019. (via DB)"

    Debt, Schmedt. Italian edition.
    Source: IMF, Deutsche Bank
    Correlation dislocation
    Correlation dislocation
    Source: GS
    The Logic Beyond Lausanne: A Geopolitical Perspective on the Congruence between Turkey’s New Hard Power and its Strategic Reorientation

    For those who have an interest in the subject in relation of all things happening right now. A very goodarticleby Michael Tanchum on the topic.

    The Logic Beyond Lausanne: A Geopolitical Perspective on the Congruence between Turkey’s New Hard Power and its Strategic Reorientation
    Source: Insight Turkey
    USD vs Equities
    USD vs Equities
    Source: Goldman
    EV: The battery (rare metal) bottle-neck?

    Eric Nuttallbrings upan interesting point: "Electric car adoption: ignoring the matter of 5 years olds digging for cobalt with their bare hands in the DRC, can someone explain to me how mass adoption happens over a reasonable time frame when all known reserves of cobalt/lithium would be ~ exhausted?"

    EV: The battery (rare metal) bottle-neck?
    Source: Bernstein
    shortest ever recession.....shortest ever recovery....?

    This month’s downtick in the global PMIs would represent the earliest-ever momentum loss in this indicator after a recession

    Chart: Level of JPM global composite PMI in two years before and after the end of seven US recession of past 50 years. Pre-1998 levels inferred from ISM survey.

    shortest ever recession.....shortest ever recovery....?
    Source: JPM
    Large speculators haven't had this much short exposure to major equity index futures in over a decade. They're short about $47 billion worth
    Large speculators haven't had this much short exposure to major equity index futures in over a decade. They're short about $47 billion worth
    Source: sentimenttrader
    Hedge Funds have gone from net long 18.5k in NDX mini futures to net short 134.3k in 3 weeks
    Hedge Funds have gone from net long 18.5k in NDX mini futures to net short 134.3k in 3 weeks
    Source: Refinitiv
    Covid: US hospitalization rates rising. Giant red flag.

    There has been plenty of talk about the rise in cases are ok as hospitalization rates are low. This appears to be changing.

    As George Pearkspoints out"US COVID hospitalizations are up WoW for the first time since July; increase isn't large yet and overall rate remains near best levels since March but this is a giant red flag."

    Covid: US hospitalization rates rising. Giant red flag.
    Source: George Pearks
    Cantillon Effect 101

    Sahil Bloom has an excellent and simplethreadexplaning the Cantillon effect. Maybe there are some kinks in "trickle down economics"...?

    Cantillon Effect 101
    Source: Anthony Pompliano
    85% of STAR index is tech & biotech
    85% of STAR index is tech & biotech
    Source: WIND
    Construction. Cali vs Texas

    Sometimes, a simple chart can explain a lot of things.

    Construction. Cali vs Texas
    Source: US Census
    Indian farmers block railway lines and roads to protest agricultural reforms

    Indian farmers are turning on Modi. FTreports"Angry farmers have blocked highways & railways across India in 2nd day of protests against agricultural reforms that they say will leave them at the mercy of corporate agribusinesses. Ruling BJP pushed farm bills through parl to deregulate ag markets”

    On top of covid, another headwind for Modi. Maybe his power is not as safe as some expect.

    Used car sales. Truly a v-shaped recovery.

    To little surprise, it appears one market which there has been a v-shaped recovery. Via, "North bluff Capital". Carmax CEO Bill Nash "Carmax asked on wholesale strength: "As COVID unfolded, we saw some of the most rapid depreciation in a very short period of time. We also saw the most rapid appreciation. I think from the depth of COVID, there's probably a $3,000 to $4,000 swing in vehicle value.""

    Used car sales. Truly a v-shaped recovery.
    Iceland: No longer a covid island.

    Iceland which had basically eliminated covid is seeing rapid increase in cases. Does not bode well for other countries.

    Iceland: No longer a covid island.
    Source: European CDC
    COVID goes rural

    Daily new cases in the US have picked up since September 12, most notably in rural counties

    COVID goes rural
    Source: JHU
    IPO Market Parties Like It’s 1999

    According to WSJ 80% of the money raised by initial public offerings falls into three buckets: healthcare, technology and SPACs.

    WSJ article worth a read, linkhere.