If there are two things we’ve learned this year, it’s that you do not in fact have to be “super smart†to make money in a centrally-planned market and you do not in fact have to be “super smart†to be a world leader in possession of nukes.
As Kim Jong-Un would say, even a “dotard†can do it.
Either way, you gotta be super smart to run a country and sell vol. buddy, okay? It’s not easy.
Oh, really? Okay, well, maybe we should tell that to Donald Trump and the Target managers, because they’re waving nukes around and starting hedge funds, and they’re dotards.
Despite a series of truly outlandish threats from Trump and Kim and despite a Fed that looks like it wants to stay the course on hiking again in December and is moving ahead with balance sheet normalization as expected, we came out largely unscathed – at least in terms of risk assets.
Stocks meandered around for the week, falling on the Fed before rebounding into the close on Wednesday and ultimately ending up largely back where they started with the Dow the best and the Nasdaq the worst:
The dollar had its second straight week of gains – that’s the best “streak†(if you want to call it that) since April. You can of course thank the Fed.
Everyone is watching the 5s30s – flattest since 2007 following Janet:
Gold and USD/JPY reacted as you might expect to the Fed on Wednesday and while yellow doorstops moved back toward $1,300 on Friday after North Korea said it might detonate an H-bomb in the middle of the ocean (and yes, that’s just as crazy as it sounds), gold’s still sitting near its lowest levels since late August:
Biggest two-week decline for the yuan against the dollar since November:
For whatever this is worth, the data is still coming in positive in Europe, which adds to Draghi’s conundrum (remember: leaning hawkish risks sending the euro back off to the races):
