October '22 Macroeconomic and Crypto Updates
Alpha Drop Ep. 003
Welcome to the Alpha Drop Newsletter 👋
You can watch the October '22 episode of Alpha Drop below:Â
This week we spoke to Drej. Drej works at New Order and Y2k and has a background in derivatives. We picked his brain on all things macro and do our best to summarize below.Â
Episode Summary
All-in-all, the plot has thickened since the last episode. We're still feeling the ripple effects of the pandemic and the ongoing war. Many people see the current state of things as temporary, but as we discuss in the episode, there will be long term consequences.Â
We also discuss the Fed's strategy for combating inflation. Drej isn't convinced that the current inflation is as bad as people think it is on a long time horizon. He then highlights that even though the Fed is fighting inflation with higher rates, it doesn't mean the root causes of that inflation will go away.Â
Next Drej walks us through his indicators for a Fed pivot. He notes that the price action of Fed Funds Futures after Powell speaks will let you know immediately what the market thinks. Retail generally watches stock indices or 10 year treasury yields, but that doesn't paint the full picture. Fed Funds Futures are a more pure indicator among other things.Â
Last, but not least, we spend time walking through what to expect in the coming months, what people are getting wrong about the market, how this compares to 2008, and lots more.