Tom Graff
@tdgraff.bsky.social
Head of Investments at Facet. Keeping the dream alive. Looking for people to follow from the other place. Holla at me.
I'm sure this is true, but it is also true that *every* correction ends with a short-covering rally. You just don't know which one is going to mark the bottom.
April 2, 2025 at 7:22 PM
I'm sure this is true, but it is also true that *every* correction ends with a short-covering rally. You just don't know which one is going to mark the bottom.
Absolute disgrace that so many of the articles about the late great Val Kilmer don't mention his greatest role: that of Chris Knight.
a man wearing a sweater with a maze pattern on it is talking to another man
ALT: a man wearing a sweater with a maze pattern on it is talking to another man
media.tenor.com
April 2, 2025 at 12:31 PM
Absolute disgrace that so many of the articles about the late great Val Kilmer don't mention his greatest role: that of Chris Knight.
Bond market is bull flattening: long-term yields are down, short-term yields are flat.
That's what happens when the market thinks high Core PCE will keep the Fed from cutting short-term, but the economy will be weaker long-term.
IOW, soft spending number >> hot inflation number
That's what happens when the market thinks high Core PCE will keep the Fed from cutting short-term, but the economy will be weaker long-term.
IOW, soft spending number >> hot inflation number
March 28, 2025 at 1:13 PM
Bond market is bull flattening: long-term yields are down, short-term yields are flat.
That's what happens when the market thinks high Core PCE will keep the Fed from cutting short-term, but the economy will be weaker long-term.
IOW, soft spending number >> hot inflation number
That's what happens when the market thinks high Core PCE will keep the Fed from cutting short-term, but the economy will be weaker long-term.
IOW, soft spending number >> hot inflation number
This is big if true. I can't help but think about when Goldman backed out of the subprime MBS game ahead of everyone else. This isn't going to be a macro disaster on that level of magnitude, but it could be a case of one player realizing the market is shifting ahead of others.
March 26, 2025 at 3:10 PM
This is big if true. I can't help but think about when Goldman backed out of the subprime MBS game ahead of everyone else. This isn't going to be a macro disaster on that level of magnitude, but it could be a case of one player realizing the market is shifting ahead of others.
Give Bessent credit: he's consistent. IMV stuff like the size of auctions or minor tweaks to fin reg is only going to impact rates on the margins.
But Bessent always claimed Yellen was moving the 10yr materially (calling it stealth mon pol). So it makes sense that he believes this stuff will work.
But Bessent always claimed Yellen was moving the 10yr materially (calling it stealth mon pol). So it makes sense that he believes this stuff will work.
March 24, 2025 at 12:24 PM
Give Bessent credit: he's consistent. IMV stuff like the size of auctions or minor tweaks to fin reg is only going to impact rates on the margins.
But Bessent always claimed Yellen was moving the 10yr materially (calling it stealth mon pol). So it makes sense that he believes this stuff will work.
But Bessent always claimed Yellen was moving the 10yr materially (calling it stealth mon pol). So it makes sense that he believes this stuff will work.
Sometimes the thing in the news isn't really what is driving markets.
March 24, 2025 at 11:29 AM
Sometimes the thing in the news isn't really what is driving markets.
If you privatize the GSEs, the key will be to retain the TBA market. There are fairly easy ways to maintain an effective govt gtee. TBA is trickier. Not impossible, but trickier.
W/o TBA, mortgages become harder to trade and hedge for originators. That would drive mortgage rates up.
W/o TBA, mortgages become harder to trade and hedge for originators. That would drive mortgage rates up.
March 24, 2025 at 11:09 AM
If you privatize the GSEs, the key will be to retain the TBA market. There are fairly easy ways to maintain an effective govt gtee. TBA is trickier. Not impossible, but trickier.
W/o TBA, mortgages become harder to trade and hedge for originators. That would drive mortgage rates up.
W/o TBA, mortgages become harder to trade and hedge for originators. That would drive mortgage rates up.
I'm certain real work will be put in on privatizing FNM/FRE, but it is logistically and politically difficult. It would be difficult to pull off without mortgage rates rising, which is something voters watch carefully.
I'm skeptical Trump ever pulls the trigger on it.
www.wsj.com/finance/regu...
I'm skeptical Trump ever pulls the trigger on it.
www.wsj.com/finance/regu...
Trump’s Housing Chief Embarks on Shake-Up at Mortgage Giants Fannie Mae and Freddie Mac
Board members and senior managers have been ousted, and the administration is weighing proposals to privatize the mortgage giants.
www.wsj.com
March 24, 2025 at 11:06 AM
I'm certain real work will be put in on privatizing FNM/FRE, but it is logistically and politically difficult. It would be difficult to pull off without mortgage rates rising, which is something voters watch carefully.
I'm skeptical Trump ever pulls the trigger on it.
www.wsj.com/finance/regu...
I'm skeptical Trump ever pulls the trigger on it.
www.wsj.com/finance/regu...
While we wait for the Fed, check out my take on how DOGE and Trump's government layoffs could impact the economy.
www.youtube.com/watch?v=DaYy...
www.youtube.com/watch?v=DaYy...
Will Government Layoffs Crash the Economy? What Investors MUST Know!
YouTube video by Facet
www.youtube.com
March 19, 2025 at 6:28 PM
While we wait for the Fed, check out my take on how DOGE and Trump's government layoffs could impact the economy.
www.youtube.com/watch?v=DaYy...
www.youtube.com/watch?v=DaYy...
In fairness, this is heavily because of the huge increase in the trade deficit, which is almost certainly going to be a one-quarter thing.
The Atlanta Fed’s GDP Now projection for Q1 is still deeply negative.
March 19, 2025 at 6:19 PM
In fairness, this is heavily because of the huge increase in the trade deficit, which is almost certainly going to be a one-quarter thing.
It is widely assumed that Waller is auditioning for the Chairmanship should Powell step aside. I don't disagree, but I do think Waller is a guy who charts his own path. Witness his dissent today, arguing that the Fed should continue with QT. That's not the kind of dovish dissent the WH would want.
March 19, 2025 at 6:19 PM
It is widely assumed that Waller is auditioning for the Chairmanship should Powell step aside. I don't disagree, but I do think Waller is a guy who charts his own path. Witness his dissent today, arguing that the Fed should continue with QT. That's not the kind of dovish dissent the WH would want.
If anyone is interested in how I'm navigating the current market volatility, we're running a 30 minute webinar tomorrow afternoon. I do this every month for Facet members, but this one is open to the public. Would love to see you there.
facetwealth.zoom.us/webinar/regi...
facetwealth.zoom.us/webinar/regi...
Welcome! You are invited to join a webinar: Meet Facet's Chief Investment Officer (CIO) Tom Graff. After registering, you will receive a confirmation email about joining the webinar.
Interested in learning more about Facet's investment strategy? Join us this Thursday, March 13th, at 12:00 PM ET, when Tom Graff will share insights into how Facet manages members' portfolios, provide...
facetwealth.zoom.us
March 12, 2025 at 3:34 PM
If anyone is interested in how I'm navigating the current market volatility, we're running a 30 minute webinar tomorrow afternoon. I do this every month for Facet members, but this one is open to the public. Would love to see you there.
facetwealth.zoom.us/webinar/regi...
facetwealth.zoom.us/webinar/regi...
I'm willing to give this site time. It def doesn't have the engagement (even excluding the bad engagement) of the orig.
Unfortunately right now, neither site is has the diversity of opinions that I'd prefer.
Unfortunately right now, neither site is has the diversity of opinions that I'd prefer.
"I want to switch over to Bluesky, but I just don't get the kind of engagement I get on Twitter."
Wow, you mean your strategy of following 18 people here and showing up once every three weeks to complain about how quiet it is hasn't paid off? Surprising!
Wow, you mean your strategy of following 18 people here and showing up once every three weeks to complain about how quiet it is hasn't paid off? Surprising!
March 10, 2025 at 8:21 PM
I'm willing to give this site time. It def doesn't have the engagement (even excluding the bad engagement) of the orig.
Unfortunately right now, neither site is has the diversity of opinions that I'd prefer.
Unfortunately right now, neither site is has the diversity of opinions that I'd prefer.
If you think like an economist drawing curves on a whiteboard, I think Bessent is right. Tariffs are a 1x supply shock, which should cause a 1x price increase. That technically isn't inflation.
I think in reality, it isn't that simple. 1/
www.youtube.com/watch?v=HeZS...
I think in reality, it isn't that simple. 1/
www.youtube.com/watch?v=HeZS...
Treasury Secretary Scott Bessent: Tariffs are a 'one-time' price adjustment
YouTube video by CNBC Television
www.youtube.com
March 10, 2025 at 9:14 AM
If you think like an economist drawing curves on a whiteboard, I think Bessent is right. Tariffs are a 1x supply shock, which should cause a 1x price increase. That technically isn't inflation.
I think in reality, it isn't that simple. 1/
www.youtube.com/watch?v=HeZS...
I think in reality, it isn't that simple. 1/
www.youtube.com/watch?v=HeZS...
US job gains are always either good or bad. They don't stay mediocre for long. This chart shows that job growth never sits btw 0-1% (red line). If it falls below 1%, it either rebounds quickly or goes negative. This is rolling 6mo to take out noise.
Rn we're fine, but it can't go much lower.
Rn we're fine, but it can't go much lower.
March 7, 2025 at 1:48 PM
US job gains are always either good or bad. They don't stay mediocre for long. This chart shows that job growth never sits btw 0-1% (red line). If it falls below 1%, it either rebounds quickly or goes negative. This is rolling 6mo to take out noise.
Rn we're fine, but it can't go much lower.
Rn we're fine, but it can't go much lower.
There's at least 100k worth of layoffs + buyout that is going to flow through the system at some point. Some will quickly get other jobs, but I'd also assume the Fed job loss number keeps climbing. So this will be impacting the data for a while.
Federal government employment ex the postal service down 10k MoM, biggest drop since the 16.3k decline in October 2019 if you exclude the Census-driven temporary hire eliminations from 2020.
March 7, 2025 at 1:38 PM
There's at least 100k worth of layoffs + buyout that is going to flow through the system at some point. Some will quickly get other jobs, but I'd also assume the Fed job loss number keeps climbing. So this will be impacting the data for a while.
Basically an in-line payroll number, spoos jump 35 points. Exactly what I was saying here. Remember folks, when the market is on edge, you get big moves in both directions on relatively minor news.
I would guess, emphasis on guess, there's an unusually large reaction in stocks to this payroll number. A tiny beat might set off a pretty big relief rally.
March 7, 2025 at 1:34 PM
Basically an in-line payroll number, spoos jump 35 points. Exactly what I was saying here. Remember folks, when the market is on edge, you get big moves in both directions on relatively minor news.
Great episode. One thing that didn't come up is how wildly underweight most US investors are to Europe. Markets-wise, a little economic outperformance could cause a big shift in asset allocation.
NEW ODD LOTS
We just saw one of the most consequential weeks in the history of modern Europe.
A must-listen with DB's George Saravelos on Germany's spending package, and why it's the biggest story since German reunification podcasts.apple.com/us/podcast/w...
We just saw one of the most consequential weeks in the history of modern Europe.
A must-listen with DB's George Saravelos on Germany's spending package, and why it's the biggest story since German reunification podcasts.apple.com/us/podcast/w...
We Just Saw Europe's Biggest Week in Decades
Podcast Episode · Odd Lots · 03/07/2025 · 30m
podcasts.apple.com
March 7, 2025 at 1:10 PM
Great episode. One thing that didn't come up is how wildly underweight most US investors are to Europe. Markets-wise, a little economic outperformance could cause a big shift in asset allocation.
IMV, stocks aren't falling bc of spending cuts or anything DOGE is doing. Stocks don't like tariffs and esp the haphazard way they are being implemented. If the House budget were to pass as is, I don't see that as economically contractionary.
March 7, 2025 at 1:09 PM
IMV, stocks aren't falling bc of spending cuts or anything DOGE is doing. Stocks don't like tariffs and esp the haphazard way they are being implemented. If the House budget were to pass as is, I don't see that as economically contractionary.
I would guess, emphasis on guess, there's an unusually large reaction in stocks to this payroll number. A tiny beat might set off a pretty big relief rally.
March 7, 2025 at 11:54 AM
I would guess, emphasis on guess, there's an unusually large reaction in stocks to this payroll number. A tiny beat might set off a pretty big relief rally.
Reposted by Tom Graff
I'm not crazy worried about this. But I think the right interpretation is that consumers don't have a lot of give. If income growth wanes, consumer spending will slow in a hurry.
March 6, 2025 at 3:11 PM
I'm not crazy worried about this. But I think the right interpretation is that consumers don't have a lot of give. If income growth wanes, consumer spending will slow in a hurry.
For those trying to actually ascertain the impact of tariffs on inflation, company profits, markets, etc., two things to consider.
First, consider who in the supply chain has market power. Here, $WMT is saying they think they can squeeze suppliers, but don't want to raise $ on consumers. (1/2)
First, consider who in the supply chain has market power. Here, $WMT is saying they think they can squeeze suppliers, but don't want to raise $ on consumers. (1/2)
March 6, 2025 at 2:00 PM
For those trying to actually ascertain the impact of tariffs on inflation, company profits, markets, etc., two things to consider.
First, consider who in the supply chain has market power. Here, $WMT is saying they think they can squeeze suppliers, but don't want to raise $ on consumers. (1/2)
First, consider who in the supply chain has market power. Here, $WMT is saying they think they can squeeze suppliers, but don't want to raise $ on consumers. (1/2)
Miran and I got into it a few times on the other site. I didn't agree w/ him much, but I'll give him this: he always tried to have an honest debate.
Regardless, at no time did he offer *evidence* that this "activist Treasury" bit had a meaningful impact. He just waived his hands in that direction.
Regardless, at no time did he offer *evidence* that this "activist Treasury" bit had a meaningful impact. He just waived his hands in that direction.
Trump CEA nominee Stephen Miran says the Fed should have tightened policy more aggressively during its past hiking cycle. The U.S. economy didn't have a recession in 2023 because the Fed did not successfully pursue policies to offset inflationary forces. www.banking.senate.gov/imo/media/do...
March 6, 2025 at 1:57 PM
Miran and I got into it a few times on the other site. I didn't agree w/ him much, but I'll give him this: he always tried to have an honest debate.
Regardless, at no time did he offer *evidence* that this "activist Treasury" bit had a meaningful impact. He just waived his hands in that direction.
Regardless, at no time did he offer *evidence* that this "activist Treasury" bit had a meaningful impact. He just waived his hands in that direction.
"one away" hint is virtually worthless
March 6, 2025 at 11:36 AM
"one away" hint is virtually worthless