Alpha Report: Interest Rate Update

The progression in macro views

Macro Context:

The research, tensions, and redundancy planning for interest rates have been laid out in the following reports:

• Alpha Report: The Credit Cycle, Bond Market Crash, and Final Capitulation

• Alpha Report: BOND MARKET CRASH

• Interest Rate Report: The risks are mounting

We are in a period of the cycle where the Fed has already cut rates from their highs, and the 2-year is BELOW the long end. We are approaching a critical point because the long end is moving UP as inflation data compresses in a range. Notice that the 30-year has moved up and widened its spread from the short end to reflect higher nominal GDP expectations.

I want to zoom in specifically to the price action we saw this last week and how it relates to the short end.