The always insightful John Authers highlights the role that monopoly profits play in the current market rally - a point we also made to Absolute Strategy Research clients in a recent note...we also showed how large cap profits come at the cost of margins in the small and mid caps...

An excellent article from Simon Nixon on some of the causes of and potential solutions to the Eurozone growth malaise. And it has more to do with Banks than AI... For full transparency, Absolute Strategy Research is delighted to have Simon Nixon as a consultant ahead of the UK election.

The 'big short' in the Hedge Fund Basis Trade is the counterpart to Asset Managers increasing their net-long exposures to Treasuries, as yields have risen

As US yields have risen back toward 5%, the US Hedge Fund 'big short' in the Treasury Basis Trade' has exploded back into life. Six months ago, the scale of this trade attracted a great deal of Federal Reserve, Bank of England and @IMF concern...it is likely to do so once again

Many thanks to Callum Thomas for including this Absolute Strategy Research chart of US yields in his ever excellent weekly chart storm alongside so many amazing #fintwit content creators. It’s always an honour to have our charts included in Callum’s curated content. Thank you…

Thank you to Steve Hou (“LEASE MORE”) for sharing his time and thoughts at Absolute Strategy Research this afternoon. So much to discuss and so little time! Fascinating discussion on his pricing power models and his work on fiscal issuance in different inflation regimes. It was great to meet Steve in person.

If you do want to add-in the buyback yield on top of the dividend yield to look at the relative valuation of Bonds and Equities this is what you get... a level of overall yield still lower than anytime since the mid-2000s, the early 2000s, 1987 and the Nifty-50 period.

Why I do NOT use Buybacks in valuation comparisons with Cash or Bond Yields... because the latter are 'reliable' income streams, as are dividends (which are rarely cut), as the Chart below shows, Buybacks are much more volatile... and the income from them less reliable.

120 years of the Bond/Equity Yield Ratio. This chart shows how today's extreme divergence between Bonds and Equity yields was previously only seen briefly in 1987, and a longer period in the Tech bubble... It may not matter in the short run, but longer-term, valuations matter

The TINY ( #thereisnoyeild ) market means that you can now get almost 4x the yield in Treasury Bills rather than US Large Cap stocks...in the last 100 years has only ever been the case in the Tech Bubble years

From TINA (There is No Alternative) to TINY (There is No Yield) - We recently highlighted to Absolute Strategy Research clients that US S&P Yields at 1.4% had only been lower 3% of the time in the last 100 years...

From the world of TINA 'There Is No Alternative' to the TINY (There is No Yield) world... Many thanks to John Authers for highlighting our recent comments in his excellent Bloomberg Opinion piece today. bloomberg.com/opinion/articl… via Bloomberg Opinion

ASR Asset Allocation Survey Results | 5 Top Charts

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