Recap 4-12-13


This will be remembered was the week all the ‘currency alternatives’ died. Gold, Silver, Bitcoin. And it happened right after the BoJ went nuclear. Ironic, n’est pas?

Note, however, that sharp drops in Gold and Silver seem to coincide with lower future returns for risk assets. This is more of an anecdotal observation, as I haven’t had time to run the statistics. But on the hypothesis that sharp drops in Gold tend to be deleveraging events, and applying the corollary that deleveraging events tend to spread, it may be prudent to watch price action carefully here, especially since 1) we have gotten a string of disappointments in the economic data and 2) seasonality turns south by month end.


  • US Retail sales declined -0.4% MoM in March vs 0.0% exp and 1.0%. The Core figure declined -0.2% vs +0.2% exp and 0.4% prev.
  • UMichigan Confidence dropped to 72.3 vs 78.6 exp and prev. This was the weakest reading since July 2012.
  • The BoJ rinban buyback operation was generally weak with the exception of the 0-1 year sector. 10yr JGBs closed 6 basis points higher on the day in yield.
  • Both JPM and WFC beat, but with caveats.

Upcoming Data:

  • Sun: Australia Home Loans, China IP, Retail Sales, GDP
  • Mon: EU Trade Balance, Empire Mfg, NAHB Housing Market Index
  • Tue: UK CPI, German Zew, US Housing Starts