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**Tchir: Not Angry Enough To Write?**

Tchir: Not Angry Enough To Write?

_Authored by Peter Tchir via Academy Securities,_ (https://academysecurities.com/)

I really wanted to title today’s report “ **Don’t Cry for Me Argentina**” so that I could write about how amazing the country is! Great trip and while I had high expectations, those expectations were far surpassed by the actual experience.

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Then, I started leaning towards “ **Road to Nowhere**”. In the past 2 weeks, the 10-year yield is up 18 bps, but the S&P 500, Nasdaq 100, and credit spreads are basically unchanged. Even bitcoin is unchanged, although it did surge and drop 10% during that timeframe. However, I already used “Road to Nowhere” as a title so I couldn’t use it again. Side note – the SNL skit “Flight to Nowhere from LaGuardia” is still one of the better skits I’ve seen in years on that show.

I could write about the **Citi Economic Surprise Index** and while it has “stabilized” for now, I expect it to drop further.

I could write about the **T-bill market** where the curve is **finally attracting some attention**. T-bill yields are as low as 3.3% out to May 23rd. They start rising a bit from there (climbing to 4.1% by June 1st), but then normalize somewhere around 4.9% post July. So far, this weirdness is limited to the T-bill market, where a subset of large investors can only do T-bills and seem to be **skewing their purchases to maturities before the debt ceiling would be “breached”.** The T-bill market is hinting at concerns and issues around the **debt ceiling**, but it is not having undue influence on other markets (SOFR, CP, etc.).

We could also analyze the creation of a **0DTE VIX** (a VIX index that is based on shorter dated options), but it just **isn’t ringing any alarm bells**(or at least nothing new about the “gambling” nature of the 0DTE options market). I “know” that VIX is around 17, but to be perfectly honest, VIX is so far down on my current list of potential signals that I only know it is below 17 because there is so much chatter about this. The “new VIX” could be interesting because I think that 0DTE is where a lot more people are placing their hedging bets.

We could write about the **demise of the dollar**, but the Chinese Yuan is weaker than where it was in January, so there isn’t an urgency to this story.

I do want to write about the transition from **“Made in China” to “Made by China”**, but that isn’t urgent, and it will be long enough to be a separate “thought piece” (much like our Olympics as Bookends (https://academysecurities.com/wp-content/uploads/The-Beijing-Olympics-as-Cultural-Bookends.pdf) or Recentralization of China (https://academysecurities.com/wp-content/uploads/The-Recentralization-of-China.pdf) reports).

**Earnings season has started**, but I’m finding it inconclusive so far (I want to see “weakish” reports met by rising stock prices to turn bullish here).

On mornings where we sell-off (followed by buying in the afternoon), it is hard to tell if it is simply shorts getting squeezed, new longs being set, or something else altogether. However, I am leaning towards viewing the market as being “neutral” in terms of positioning.

**Maybe 10 days away from the screens and news flow has “dulled” my anger**. Maybe, as a contrarian who does tend to “rant” rather than “write”, I need that anger to write?

Or maybe, the markets are just that dull! I was going to go with “ **Home, Home on the Range**” but that seemed like a cop-out.

As I get back in the “saddle” there will be a lot to write about, and I do think that the **debt ceiling will be an issue that could hurt markets**. I have little faith that D.C. can “maximize” their benefit from this round of debt ceiling “side deals” without triggering at least one round of serious **_Planet of the Apes_ “you finally, really did it”** recognition by the markets.

I do think that **geopolitical risk is underpriced**, but that too is part of stories and themes that go beyond the next week or two of earnings releases.

Bank earnings seem ok, but again, the **battle over what banks have to pay on deposits to keep deposits in the banking system has moved to a phase where it will take much longer to play out** than when people were just afraid of default risk (which was heavily overstated).

**Bottom Line**

I’ve tweaked the rate section from 2 weeks ago, but little else has changed. Part of this is because I don’t have the anger and I’m still getting back into the “grind” after a nice vacation. But so little has changed in two weeks that I’m not sure why I’d change my view?

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