Nov

19

 Again and again I see misdirection as an important factor to understanding markets. When everyone is focused on China for example it will be German industrial production that moves markets, or when interest rates seem important it will be earnings and growth that matter. Big moves in commodities matter, until they don't matter anymore. A rate change now seems in the bag so the 30 year rallies, not sells off. The Fed Fund rate is in fact rarely even employed by banks, misdirection. It is the reverse repo and excess deposit rates that are very active.

Even using a quantitative approach to markets, there are only so many things you can test. So testing the what happens to the right hand will not help when the ball is in the left. No easy answers here, but Ricky Jay is a great resource on the topic and has a good film on Netflix.


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