Got Hard Assets? It's Happening - Financial Repression Breaking - LONG-TERM US YIELDS DROP ON TREASURY PLANS TO BOOST BUYBACKS - Bloomberg

The U.S. equity market (S&P 500) has already crashed internally. So many high quality names off 20-70%

Global Rates - Financing - High Impact International Small Cap Value vs. Mag7 YTD AVDV +20%* DISV +18% ISVL +16% MAGS +10% * 1-year AVDV +31% vs. Mag7 MAGS +14%

Commodities in a global FX debasement regime, multipolar world are Destroying big tech…

A “Bull Market” with Financials 20% off? Goldman Sachs $GS entered a bear market this week. When was the last time this happened with the S&P 500 at an all time high? *2018 1MDB scandal?

This is the most important tweet of the week. The epic crash in the bond market at some point becomes a threat to equities. Don’t forget the $40T of bonds issued 2018-2021 near 0-3%, trading down 60 to 20 cents on $, maybe $19T is still out there, The Fed is sitting on a lot of that. But when bond prices get this low they can offer huge 20-70% mark to market fwd returns (duration bonds) if rates mean revert - normalize. The AAPL 2.55s of 2060 are < 50 cents on $. So if the UST 30s go back to 4%, these bonds would get back to the low 70s. If that happens over the next 3 years - that’s 18% compounded total return per year!

The crazy thing about this is 200ish of those lows are fixed income (bond) closed end funds + pfd stocks, so the rip higher in rates is distorting the new lows data to some degree.

RT @TruthGundlach: The dilemma: If the Fed hikes it will worsen the interest expense problem (since so much borrowing is at the short end)…

Treasury yields March 2020: 30 year 1% 10 year 0.5% 5 year 0.5% 2 year 0.4% 3 month 0% Today: 30 year 5.4% 10 year 5.1% 5 year 5% 2 year 4.9% 3 month 4.1%

Close to 60% of S&P 500 components are in a bear market, 20% or more drawdown.

Interest rates UP, bonds prices DOWN. Now offering equity like returns. Hard not to call today’s UST move a crash. Prices in 10s straight down and a 15bp yield move. The 5yr auction was terrible with a massive tail, latest conspiracy theory is that China unloaded supply to set the US Treasury on its back foot in front of the upcoming Summit. Utilities very weak but tech is the long duration asset.

Inflation: Streaming CPI +75%

*FIVE-YEAR TREASURY YIELD RISES TO 5% FOR FIRST TIME SINCE 2007 - Bloomberg

2026 Energy vs Big Tech XOP: +52.3%. XLE: +45.8%. OIH: +40.0%. QQQ: +21.0%. *If it was a fight, they’d stop it.

Passive investing is broken. Three years ago a $160B valuation for all 3 combined. Now they are entering the Nasdaq 100 post IPO.