https://www.forexfactory.com/news/12...treasury-bills
Lets dissect this bit of ‘news’ that got little attention from the FF crowd likely because most people here including me, don’t have a convenient way to short T-bills.
The gist is that Bill thinks T-bills are a good hedge against persistently high inflation and he thinks the US gov should be doing more to hedge against inflation and investors should short Treasuries.
Q: Do we expect a big time trader like Bill A to comment openly on his real positions?
A: No! It would be suicidal to reveal your cards in this high stakes game.
Q:So why is Ackmann tweeting? (is it X-ing now??)
A: He is trying to influence the market.
Q: Why? Is this a pure fabrication intended to induce short selling?
A: Unlikely. Lying about his position wouldn’t be illegal but it would expose him to criticism once it was exposed. What is likely is that he is lying about his expectations.
Bill is probably short T-bills as you would be when the economy is running hot, stocks are skyrocketing and the yen is practically worthless vs the rising USD.
However I doubt very much that he expects perennial 3% inflation. He sees that inflation is already cooling. The economy is already slowing. He sees that the Fed will have to start slashing rates instead of hiking further. In other words it’s time to exit his short position in T-bills.
But as we learned from Livermore, it’s not that simple for a big trader to exit a big position. They need liquidity to trade into. They need greater fools to go short treasuries so that he can then go long.
Q: So should we do the opposite?
A: Essentially yes. Once again the news actively misleads. I would go long treasuries and related options, expecting that Bill will soon or already has. I expect the USD to weaken as rates are cut. I expect a stock market melt-up, inducing fools to rush in and then a wild plunge. However things are already looking bearish, so maybe it’s already started.
Lets dissect this bit of ‘news’ that got little attention from the FF crowd likely because most people here including me, don’t have a convenient way to short T-bills.
The gist is that Bill thinks T-bills are a good hedge against persistently high inflation and he thinks the US gov should be doing more to hedge against inflation and investors should short Treasuries.
Q: Do we expect a big time trader like Bill A to comment openly on his real positions?
A: No! It would be suicidal to reveal your cards in this high stakes game.
Q:So why is Ackmann tweeting? (is it X-ing now??)
A: He is trying to influence the market.
Q: Why? Is this a pure fabrication intended to induce short selling?
A: Unlikely. Lying about his position wouldn’t be illegal but it would expose him to criticism once it was exposed. What is likely is that he is lying about his expectations.
Bill is probably short T-bills as you would be when the economy is running hot, stocks are skyrocketing and the yen is practically worthless vs the rising USD.
However I doubt very much that he expects perennial 3% inflation. He sees that inflation is already cooling. The economy is already slowing. He sees that the Fed will have to start slashing rates instead of hiking further. In other words it’s time to exit his short position in T-bills.
But as we learned from Livermore, it’s not that simple for a big trader to exit a big position. They need liquidity to trade into. They need greater fools to go short treasuries so that he can then go long.
Q: So should we do the opposite?
A: Essentially yes. Once again the news actively misleads. I would go long treasuries and related options, expecting that Bill will soon or already has. I expect the USD to weaken as rates are cut. I expect a stock market melt-up, inducing fools to rush in and then a wild plunge. However things are already looking bearish, so maybe it’s already started.
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