Friday wrap, august 15

market vibes...

Today in Alaska…

“An excellent meeting,” according to both leaders.

Fifty-six years ago somewhere… another historic summit.

Today is Gary Larsen’s Birthday, one of my favorites

A few x posts of interest today

I got this chart from an MV reader in my comments section today quoting a line in the morning note (ht snarky trader): "I saw an interesting piece of tactical research yesterday that said CTAs are maxed out, and the point of the spear is retail." https://x.com/Barchart/status/1956365448691286093

In other equity news via an X post, insiders bought INTC 1DTE exp 5% calls a few minutes before news Trump might ink a deal with INTC. A few minutes? Nancy must be slippin’.

This next one is not my lane, but I get it. Any chart like this has meaning.

“Fed Reverse Repo usage has plunged to $28.8B, the lowest since 2021. Down from $57.49B just yesterday. This is a massive liquidity shift in 24 hours. (source StockMarket.News @investinq)

The rub: Bank reserves get drained → repo market stress → Fed forced into emergency liquidity injections (think 2019 crisis on steroids). But here’s the twist with the Trump Admin and Bessent behind the wheel: A funding crunch like this could be the perfect opening for the Treasury to step in with a U.S. asset-backed stablecoin, bypassing the Fed’s balance sheet entirely. Imagine Treasury-issued, blockchain-based dollars backed by T-bills (and even gold or the strategic bitcoin reserve) becoming the settlement layer. This would effectively: *Provide direct market liquidity without relying on the Fed. *Give the U.S. a programmable, instant-payment dollar. *Gradually strip the Fed of its monopoly on reserves and settlements. In short: RRP collapse → Fed vulnerability → Treasury stablecoin pilot → Fed’s role shrinks. “End the Fed” could actually occur, not by Congressional vote, but by monetary evolution.”

And …more bubblicious data courtesy of the Mags.

In the markets

WTI and the front of the curve traded lower. It’s a binary trade. If you think Putin and Trump can make a deal, you’re short. The flip side, of course, is no deal and long.

December gold opened at the POC and closed at the POC.

SLV did not trade under $34.00. I didn’t see any signs of stress in the silver market today. No slams as usual. Gold and silver traded flat in narrow ranges. Today was the last big expiration for SLV in August. There is a buzz about record high silver inventories but there’s no narrative for prices to validate. Sept/Dec contango implies deliveries on 1st notice day might be big.

August Bitcoin traded a bit lower on light volume. There have been no signs of long liquidation yesterday or today.

Stocks were a mixed bag this week. NDX made an all-time high on Wednesday and traded lower without pause into the close today. S&P made an all-time high this morning and finished near the low of the day. The Dow was the leader all week, making a high a few dollars above its July 28 highs, but the Dow is still >1000 points from an all-time. The the narratives are great the action, not so much. “All hat, no cattle,” comes to mind.

my vibe

The meeting is Alaska seemed to go well, although the press got pissy when they didn’t take questions. So, on to the markets this week.

Most September rolls to December in coming days will trade at the same contangos they traded when June or July rolled to September. Bitcoin, rolling from August to September, will probably charge longs the same $800 / $1000 per coin for 3rd month of zero alpha. I did mention this the other day, “If you want to play you have to pay.”

NDX flat prices are just 4% higher than where they were for the entirety of Q4 2024. yes they are up from a catastrophic plunge….yada yada. The S&P is 3% higher than it was during the same Q4 2024 period. The Dow is 2% lower.

The nice difference about stocks is most of them do earn money. Unfortunately many don’t share earnings directly, especially gold miners. Others buy their own shares on the exchange, usually a good sign but dividends are cash and taxes on short term gains make selling shares impossible. Selling long term gains is a “life decision”. You can borrow against shares but that’s an aligator trade, 1st a finger, then an arm… then doom.

These are very hard markets to buy and hold anything, which is probably why so many professionals are not in them; just retail and CTAs…not exactly your typical buy-and-hold cohorts.

One more Larsen classic…

Have an excellent weekend!

JJ

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Charts and data CQG and Bloomberg

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