The data is scary … As of 7:08 am EST, the NADEX offered the following binary options contracts for the EUR/USD expiring this Friday (23 May 2025) at 3 pm: Contract closing above 1.1225. Buy at $9.30 Contract closing above 1.1175. Buy at $9.90 Contract closing above 1.1125. Buy at $9.90 I calculated a forward … Continue reading A big move in the EUR/USD as the US government addresses fiscal concerns …
The bet … Over the weekend, I estimated the EUR/USD would be 1.1380 on Friday 2 May 2025. As of 10:27 pm AST, the spot rate is 1.1350, citing data from x-rates.com. Using the European Central Bank short-term rate of 2.169% and the U.S. 4-week Treasury rate of 4.23% as reported by the Federal Reserve … Continue reading Will the EUR/USD to be at 1.1380 on Friday? Will that change at mid-week?
Kugler speech missed the mark … On 22 April 2025, Federal Reserve Board governor Adriana D. Kugler gave a speech on the transmission of monetary policy through the economy. Governor Kugler explained how the Federal Open Market Committee (FOMC) manages monetary policy by adjusting the federal funds rate, the rate at which banks make uncollateralized … Continue reading What Governor Kugler’s speech missed yesterday…
American traders have been showing their overall ignorance of politics in reaction to President Trump’s expressions of disgust with Jerome Powell’s approach to interbank rates. The chairman of the Board of Governors of the Federal Reserve System has long pushed back against threats from the President to dismiss Mr. Powell from the chairmanship. Caselaw found … Continue reading Imagining overnight rate volatility from a President’s involvement in rate setting. Scary. …1:01 PM AST
The Bet Last week I made a bet that yesterday the EUR/USD would close between 1.0809 and 1.0931. The currency pair is at 1.1359 according to data from x-rates.com. I took it as a lesson that you have to analyze and incorporate policy news events into your predictions and go lateral, meaning taking in as … Continue reading A big ooops moment on the EUR/USD last week.
According to data from MarketWatch, the DOW, S&P 500, and the Nasdaq are up after 48 hours of onslaught of the markets. The price of gold and oil are also up as volatility measured by the VIX has decreased. I do not know how much of the turnaround is due to the reported 90-day pause … Continue reading Back to the Future: A quick post on mercantilism.
What we’re reading: U.S. Virgin Islands. VIPSC. Utilities. “The Virgin Islands Public Services Commission is preparing to launch a series of high-stakes investigations into the territory’s public utilities — while warning lawmakers Monday that chronic mismanagement, outdated infrastructure and nonpayment of regulatory assessments are threatening the commission’s ability to carry out its duties.” — St. … Continue reading U.S.-Eastern Caribbean interbank news scan as of 11:08 pm AST: USVI concerned about Trump impact on economy.
The takeaway The markets and the general public are sliding down the rabbit hole of bewilderment as President Trump’s “will I tariff or will I not” approach to America’s trading partners have introduced more uncertainty to US investors. In some ways, this is the fault of investors themselves. I shed no tears for investors who … Continue reading Currency, Interbank, and Money Market News Scan: Trump’s conservative approach to constitutional power makes him look expansive.
What We’re Reading. Executive branch. Lawsuits. Federal Rules of Civil Procedure, Rule 65(c). “Consistent with applicable law, the heads of executive departments and agencies (agencies), in consultation with the Attorney General, are directed to ensure that their respective agencies properly request under Rule 65(c) that Federal district courts require plaintiffs to post security equal to … Continue reading Currency and money market news scan: Trump wants to make it more expensive to sue government.
Lawyers Write the Bets. Bankers Sell the Bets. 