Chair Kevin Warrsh is ending the post-2008 era of open-box transparency, forcing traders to break their "addiction" to Fed guidance. One former NEC director calls it a return to "historic norms" for a Fed dead-set on fighting inflation.
The tape Bloomberg Surveillance · Aug 3
“We unfortunately, as newscasters or as market makers or as traders, we got spoiled from the eight period on. From eight period on, the FED has been an open box. They've been completely transparent. They have not done anything that you wouldn't know they would do hours or weeks or months before they did it, and the market became addicted to knowing what the FED was going to do.”
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Prof G Markets · Aschenbrenner’s AI Fund Collapse Is Just The BeginningAug 4
After posting 439% returns in the first half of the year, 24-year-old Leo Aschenbrenner's AI fund collapsed in just six days. Margin calls on its reported 400% leveraged positions forced a $45 billion portfolio firesale, a stark warning for the "debt-fueled AI boom."
Bloomberg Surveillance · Yen Intervention and Market DriversAug 3
In a rare joint move, the US Treasury has joined Japan to intervene in currency markets, sending a "very strong signal" to speculators that betting against the Yen is getting risky. The move aims to halt a slide that has forced Japan to sell its US Treasury holdings.