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Gregor Samsa

Gregor Samsa

This site is designed as a “go to” source for traders, investors, policymakers and any interested in markets and the global economy. We provide informed opinion, timely market information, sources, and links.

Articles by Gregor Samsa

“Culture As An Asset”

20 hours ago

Stunning. Hedge funds hoovering up trading cards as an “alternative to equities” with the same passion Brooks Robinson hoovered up ground balls.

This is usually a sign of the endgame for markets, i.e,, the precursor to a bear market. Think the “Great Beanie Baby Bubble” of 1999.

In general, there are two types of assets,

They can be rare—gold bars, diamonds, houses on Victoria Peak, bottles of 1982 Pétrus, Van Gogh paintings, stamps, beanie babies, or baseball cards or
They can generate cash flows over time  – GaveKal
Creating An Illusion Of Scarcity
Scarcity relative to the money stock is what its all about now, folks. 
It probably won’t be long before the Fed has to bailout the baseball card market, no?

Full disclosure,  I do own a Mike Trout rookie card.

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COVID Deaths v. State Vax Rates

4 days ago

#CKStrong  Never forgetting Carol K. We are with your, girl!
Anyone see a pattern here?   
If you stare at the chart long enough, you can see the pink red elephant [in the room].
Sadly this chart is largely a function of the state’s politics.  Doesn’t have to be that way. 

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Think Big: State Of The Global Supply Chain & Inflation

10 days ago

#CKStrong  Go CK!
The following was originally posted at
As summer fades, the global economy is downshifting from months of super-charged growth, pumped up by unprecedented fiscal and monetary policy measures.  Growth will continue throughout the year but at a sharply decelerating rate, and inflation will remain stubbornly high.
Supply chain issues — components, commodities, and labor shortages — are now the primary constraint on growth. We do expect demand to continue to soften over the next few months, however.
Although global electronics production continues to rise, the rate of expansion has slowed sharply in the past few months.
We have constructed a narrative of the global economy, which we believe is unique and reflects the economic reality

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COTD: U.S. Budget Deficit

11 days ago

COTD = Chart of the Day

Go Carol K!  The doctors are stunned at her fight and grit.  So are we.  We want some. 

Looks like the U.S. budget deficit is going to come in around 12 percent of GDP for Fiscal 2021, which puts it in WWII territory.   The only possible way Inflation will be “transitory” (the Ice Age was transitory, by the way) is the deficit is slashed in half over the next few years but that will be painful. 
Will the Fed stop enabling the Treasury with its bond purchases? 
No doubt policymakers did the right thing throwing everything and the kitchen sink at the COVID collapse, which helped avert another depression but the exit is always the problem and will be very painful when/if normalized. 
The FOMC members talk a good game about having all the tools to

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COVID: The Red, Right, And Blue

12 days ago

Warning:  Politics may be is hazardous to your health. 
All but two of the states above the national rate of daily hospitalizations per 100k (30) are in the red, and Hawaii is kind of a special case and only one point above the national rate. Georgia really singing the Blues?  Seriously?

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Inflation Watch: Totaled Car Prices Spiking

15 days ago

During my EM trading days, I realized that all the juice had been squeezed from the more advanced emerging market bonds, such as Mexico, Brazil, Argentina, and Poland. So I started buying up the “exotic penny stocks,” such as Sudan distressed debt, which had been in default for years and trading with a $0.02-$0.04 bid/offer spread. Note the offer price is a 100% mark-up on the cash bid price. Today’s liquid coupon bonds trade with a bid/off differential of at most $0.125, and that’s considered expensive.

We lined up a ton of buyers, mainly hedgies, who really understood the MoMo markets,, at $.04, the offer price.  I bought CHF500 million (could have been US$ as my memory is fading).  The Swiss Bank trader laughed at me when we did the trade. 
Ironically, it was a Swiss

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Don’t Let The Robin Hood Gang See This Chart

16 days ago


Robinhood, the online brokerage used by many retail traders to pile in to heavily shorted stocks like GameStop Corp, has made an ambitious push into loaning out its clients’ shares to short sellers as it expands its business. – Reuters

Doesn’t the Robin Hood crowd scan the markets looking for short positions? The following chart illustrates how short auto dealers are of inventory, or how sales are depleting the current stock of new cars.

Ship in ten Mercedes, please!

Yes, the auto sector is suffering a real supply shock based on the chip shortage and is not the best example of excess demand. However, the auto supply chain and semiconductor market are.

As the world shut down because of the COVID-19 pandemic, many factories closed with it, making the

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The Future Of GMM

16 days ago

I am sure you noticed we have been a little distracted with health issues over the past year.  Some readers recently asked if GMM has “turned into s shrine for CK.”  Well, yes, for now. 

CK is a considerable part of the team here, and we love her just a much as our readers do.  She has written some excellent posts that have made them a lot of money.  

She has never worked in the securities industry as an analyst but should have.  I ran enough research shops on the Street, hired several analysts and economists, and would have hired her in a heartbeat.  She is brilliant, has an incredible work ethic, and has developed a very rigorous algorithm to break down companies.

I have also run several trading desks and hired many traders, and CK, though a longer-term investor, has

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Dawgs Get It Done For CK

20 days ago


Not the best offensive performance but a W. against the nation’s #3 ranked team. The win over Clemson should catapult Georgia into the #2 ranked college football team in the nation behind…wait for it…Alabama.

Now we need the antibiotics and miracles of modern medicine pull off a similar upset to catapult CK back to health.

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Go Dawgs! Let’s Win One For CK

20 days ago


Carol (CK) growing up in W. VA., just stung by a bee before this picture was taken. Standing on the slab and staying off the grass she believed would keep her safe. Damn good logic for a 4-year old, no?

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The Most Important Chart In The World

29 days ago

The following chart – the most important in the world to us — is our loved Carol K.’s (CK) ANC progression since her stem cell transplant on July 15th, or Day 0.

The absolute neutrophil count (ANC) is an estimate of the body’s ability to fight infections, especially bacterial infections. These test results are often referred to as a patient’s “counts.”
An ANC measures the number of neutrophils in the blood. Neutrophils are a type of white blood cell that kills bacteria.
A lower than normal number of neutrophils (lower than 500) is called neutropenia.
Lower than 100 is severe neutropenia.
The lower a person’s ANC is, the higher the risk of getting an infection.
For a cancer patient, an infection can be life-threatening and requires immediate medical attention. – St. Jude


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COTD: U.S. Labor Market

August 10, 2021


COTD = Chart of the Day

It sure doesn’t look, at least to us, like the U.S. labor market is lacking for demand. Au contraire, just the oppo. What is the Fed thinking?

“The demand for labor in the US is unprecedented.” – Daily Shot

More than 70 percent of all jobs lost to COVID are in four sectors, with the bulk of the losses in Professional & Business Services in temporary jobs.

Go deeper, folks.

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Demand Is Way Back Yet Workers Remain Scarce

August 4, 2021


What is the Fed thinking?

Getting back to the pre-COVID unemployment rate of 3.5 percent after the rules of the game have changed is a pipedream, in our view.

It’s clear the labor supply curve has shifted left.

Isn’t that evident with 32.2 percent of the unrecovered jobs in the leisure and hospitality sector yet no workers can be found? Moreover, 62.2 percent of unrecovered jobs are in three sectors: leisure and hospitality, government, and education and healthcare. None lack for demand.

Next month will be a test for the labor market as the extraordinary COVID unemployment benefits roll off. Will the government allow them to fade, however?

Demand ain’t the problem, folks.

Maybe higher wages will attract more workers, which we are

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Mother Nature’s Revenge On ‘Stupid’ America

August 4, 2021

We are so incredibly happy to report Carol K. is doing much better and has made it to the other side of her major medical procedure.  Thanks for all your help but let’s not get complacent. Keep those prayers, thoughts, all of the above, and all other coming her way, folks. A full report up soon.  #CKStrong

Just to be safe, let’s qualify the post title,

…as Tolkien once said, ‘Not all those who wander are lost,’ so too ‘not all Floridians are stupid’ but that gov’ner…

Totally lost patience with the unvaxed and their lame excuses. 

h/t:  Carol K. 

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Ignore The Bond Market Flapdoodle

July 22, 2021

CK is still in the fight of her life.  Again, we ask that everybody, everywhere please bring all and whatever you got in the form of prayers, thoughts, positive energy, manifestations, visualizations, anything and everything with powerful intensity her way.

We have been working on this post for some time and want to get it out before the data are too stale.   We will break it up into three or four pieces because our analysis of the Treasury market usually results in exceptionally long reads.  One reader wrote about our last big research piece on the T market:

This post is so big you can see it from outer space!

We also do not want to bury the lead. 
Longer-term Treasury yields are so distorted by central bank buying they are now and have been for years worthless in

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Godspeed, CK

July 21, 2021

Our Carol K. is entering a critical phase in her health battle. Everybody, everywhere please bring all and whatever you got in the form of prayers, thoughts, positive energy, manifestations, visualizations, anything and everything with powerful intensity her way.

She is a truly amazing person.

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Real Trees Don’t Grow To The Sky

July 15, 2021

Our Carol K. starts her new procedure tomorrow to fight off her AML. Come on, world, let’s will her to heath! You go, girl!

Check out the “spectacular” (ht/ CK) roundtrip in the price of lumber this year. After rising over 160 percent from January to May, Timber!

The commodity has fallen 70 percent and is now below its breakout price.

The pulp flop has brought out those preaching the the “D” word and point to lumber as a sign of deflation. O.M.G.!

Me thinks the price action reflects what I used to tell my young traders, who couldn’t resist chasing prices to the moon.

“Trees don’t grow to the sky,” an old German proverb translated from “Bäume wachsen nicht in den Himmel, which suggests there are fundamental and valuation limits on how high asset and

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Core 3-Month Inflation Running At 10.52% Annualized

July 13, 2021

Our beloved Carol K. starts a new risky treatment this week to try and conquer her serious illness.  Everyone at GMM and all of our readers are with you, girlfriend!  

Can’t wait to hear the Chairman justify zero rate policy and deficit monetization with inflation roaring at > 5 percent. It would be entertaining, if it weren’t so damaging.
….CPI prints > 4 percent in May and you heard it here first. – GMM, April 29th

The past three months of core CPI inflation prints have been big, big, big — 0.9, 0.7, and 0.9 percent, respectively. There is zero “base effect” on these data, folks.

If annualized, as the GDP prints are, the economy hasn’t seen this type of three-month core inflation since 1981.

Sure, some have to do with the reopening, and some not.

Our priors

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Risky Biz: Taiwan & South Korea’s Low Vax Rates

July 12, 2021

Just a follow-up to our last post, Will The Delta Variant Shut Down The Economy?, take a look at how surprisingly low Taiwan and South Korea’s fully vaccinated populations are.  Taiwan’s rate is so low, that we suspect (with little conviction) it could be bad data. 

The countries that have not done mass vaccinations could be hit hard with the Delta variant.  Some had dodged the COVID bullet in 2020 and became complacent, not making sufficient efforts to secure vaccines, while others could not afford them.   
We suspect Japan’s low vax rate, even though the country has thus far kept COVID at bay, led to Prime Minister Yoshihide Suga’s decision to declare a state of emergency. New cases are starting to tick up just as the Olympics are ready to begin, running through July 23 to August

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Will The Delta Variant Shut Down The Economy?

July 9, 2021

Tune out the nonsense, turn off the news, and stick to the data, folks. 
The Wall Street clowns are at it again, spreading fear and loathing about the new strain of COVID, the Delta variant, retrofitting a new negative narrative to explain the nonsensical bond market action.   
They thrive and need to create volatility to make their year-end bone.  
No Signal, All Noise
The Fed nationalized the bond markets long ago.  Trying to decipher an economic signal from bond yields is equivalent to guessing what price the central authorities in the old Soviet Union would set for blood sausage.  
Are bond yields falling because the economy is about to go into a tailspin or a stock market collapse is imminent?  Anything is possible, and nobody knows the future, but highly unlikely, at

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Real Patriots Worried On This July 4th

July 3, 2021

I used to go home every night as a young Wall Street trader worried about how instability on the “Arab Street” would adversely impact my long unhedged positions.  If you have been a reader of the Global Macro Monitor over the past few years, you know we have been concerned about U.S. political stability. – Global Macro Monitor, May 8, 2020

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He was born on the fourth day of JulySo his parents called him Independence DayHe married a girl named Justice who gave birth to a son called the NationAnd she walked away
Independence would daydream and he’d pretendThat some day him and Justice and Nation’d be together againBut Justice held up in a shotgun shackWouldn’t let nobody inSo a Nation cried…   – John Cougar Mellencamp

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On This Day: One Wrong Turn & History’s Biggest “Butterfly Effect”

June 28, 2021

One wrong turn, one small change in initial conditions can change the course of history enormously.  Even very true on a personal basis.  #CKStrong
Originally Posted on June 27, 2017
The butterfly effect is the concept that small causes can have large effects. Initially, it was used with weather prediction but later the term became a metaphor used in and out of science.
In chaos theory, the butterfly effect is the sensitive dependence on initial conditions in which a small change in one state of a deterministic nonlinear system can result in large differences in a later state. The name, coined by Edward Lorenz for the effect which had been known long before, is derived from the metaphorical example of the details of a tornado (exact time of formation, exact path taken) being

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China’s Baby Problem Becoming An Economic Headwind

June 26, 2021

The following video is very informative, and I don’t think I have seen a better argument for keeping the government out of the bedroom.

We live in a world of politics and/or government policy gone crazy with zero contemplation of unintended consequences.

Dildo’s In ‘Bama
It is truly a Kafkaesque, bizarro, and illogical world when one can openly carry an AR-15 on the streets of Montgomery but it’s illegal to purchase a dildo in the state of Alabama.

The Anti-Obscenity Enforcement Act of 1998 is an Alabama statute that criminalizes the sale of sex toys…It prohibits “any person to knowingly distribute, possess with intent to distribute, or offer or agree to distribute any obscene material or any device designed or marketed as useful primarily for the stimulation of human

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Dalio and Summers Debate Inflation

June 22, 2021

This video is excellent.  Long for Twitter years but well worth the time. 
Dalio and Summers crystalize the inflation debate. Summers, the traditional economist, talks about demand-pull overheating, output gaps, and labor markets. At the same time, Dalio comments on monetary inflation, where the central government, the U.S. Treasury, cannot place all its bonds into the market without spiking interest rates and must rely on the Fed’s digital printing press to take down a significant portion of the new debt. 
Both are happening as we speak, and both have been exhausted on the site with various posts.  Summers even mentions short-term inflation running at plus 8 percent annually  as we did recently.
Carol K. Continues Her Health Battle
Keep fighting, CK!  The world is rooting for

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What Is Justin Waiting For?

June 21, 2021

Wow,  Justin is acting pretty conservative for a liberal.  Canada already has some of the best COVID numbers in the world.  High VAX, low new daily cases.   
Assuming 4 percent of Canada has had (1.41 million reported cases) or has the COVID antibodies, that puts the country’s at a de facto 70 percent herd immunity rate.   Enough to sleep easy, in our book. bed.   

OTTAWA — Prime Minister Justin Trudeau maintains that Canada will need to meet the COVID-19 vaccines target of 75 per cent of the total population with a first dose and 20 per cent with two doses before his government lifts border restrictions.
Speaking to news that the U.S, Canada border will remain closed to non-essential travel for another month, Trudeau said Friday that, while he understands the urgency to return to

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The GOAT Dishing On Inflation

June 15, 2021

PTJ, the Greatest Of All-Time (GOAT) in my book. I have few regrets in life but one is not hitting his bid when I was being pursued by his hedge fund years ago. The California beach was just too comfy back then.

His views should sound very familiar if you have been reading GMM over the past several months.
Listen up to the interview with Andrew Ross Sorkin from this morning.  The 6 minutes is well worth your time.  The opportunity cost of not doing so could be enormous. 
Keep fighting, CK! 
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Feels Like 1977: Inflation Too High, Money Too Loose

June 13, 2021

This post is a short follow-up to our inflation piece from last night, Inflation In Context: A Liquidity Adjusted CPI Index, which was a bit too wonky, and we don’t think we were clear in making our points.

Again, we are sending all the prayers, positive thoughts, energy, miracles, crystals, and manifestations in the entire cosmos to GMM’s deeply loved Carol K., who continues to fight her multiple-front illness in Boston.  She contributed to this post and may or may not disagree with all the content. 

Inflation And Loose Financial Conditions
Our central thesis of last’s night piece is that inflation is rapidly accelerating, not just due to the “base effect,” and that financial conditions are far too loose. 
We’ve taken the previous three very hot core inflation prints – 0.7%,

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