21 February 2013

Core Book : Re-Think Post FOMC Minutes

  • Jan13 FOMC minutes said a “number” of participants believed an ongoing evaluation of the $85 billion per month asset purchases “might well lead the committee to taper or end its purchases before it judged that a substantial improvement in the outlook for the labor market had occurred.” = QE to end sooner rather than later.
  • Market price action since centered on USD. QE end = USD up = Stocks, Commodities, non-USD FX down. Am surprised Bonds are not wearker. (Perhaps reacting to weaker equities, but that would be circular reasoning.)
  • [Previous : Was Recovery = Stocks, EUR/USD, Bond Yields up, etc.]
  • Have had to re-classify my risk % accordingly to assess my market exposure more accurately.
  • Also, cut loss naked long EUR/USD and increased short GBP/USD (at 0.8720) to lock in a balanced long EUR/GBP only.