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market vibes

January 9… )

“This will not stand.” George Herbert Walker Bush August 5, 1990

In the News, four items that caught my eye.

China’s CPI is flirting with zero change.

Bloomberg intelligence opines “Global banks will cut as many as 200,000 jobs in the next three to five years as artificial intelligence encroaches on tasks currently carried out by human workers.” I think that is a very low estimate. And… if Wall Street is cutting 200k, how many will be cut from legal, accounting, insurance, fast food, super markets, car washes etc… and the Federal government?

Japanese workers’ base salaries grew the most in 32 years, rising 2.7% year over year in November. Nominal wages rose 3%, according to multiple sources. The narrative is, “A rate hike is imminent.” This is pretty big news in Asia.

Yahoo says, “Wednesday was the busiest day for pound options trading since the currency slumped toward an all-time low in 2022 (Truss).” Option trading has exploded in 2024 and it has caused a collapse in volatility across markets. S&Ps yesterday? Gold?

If the banks and Citadel are selling/ granting and short options, only an idiot would buy them. Occasionally, there’s a spike like August 5, 2024, but then it’s “all hands on deck” and the fire hoses of CB liquidity quench the blazes. It’s shameful that we allow our cities to burn but not our stock markets.

Imagine if Powell were responsible for putting out the fires in LA? There never would have been one, IMO. (GBP futures chart below daily continuous data).

Bitcoin

At this price for Jan CME BTC, the Jan 31 IBIT ATM 54 calls have 4,197 lots of call OI outstanding—about $23 million USD. I see 5,378 of the 55 puts in the money. I’ve just started watching these, so I won’t opine yet, but it looks like the shorts are in control here in the short term to Jan 31.

Three hundred million USD of IBIT AUM departed last week. Judging from OI (chart below with continuous data), that AUM is still out, and no changes in OI indicate that any directional movement is happening on very small marginal volume. The same range has been in force since the elections..

Moving along with metals and look back to 1991. Foreshadowing the future for oil and possibly gold.