Short QE, Long Volatility
Until the FOMC raises interest rates to more “normal” levels, we don’t expect actual volatility to decline.
The Institutional Risk Analyst
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R. Christopher Whalen
- Jul 31
- 8 min
Short Collateral & Long Tantrums
Demand for risk-free collateral and liquidity is largely a function of how JPMorgan (JPM) CEO Jamie Dimon feels about risk on any given day
825 views
R. Christopher Whalen
- Jul 24
- 6 min
Questions for Chairman Powell
QE has created a gigantic interest rate mismatch across markets for banks, non-banks and other financial intermediaries including the GSEs
487 views
R. Christopher Whalen
- May 31
- 6 min
QT Means Short Credit Risk
Market risk realized today becomes credit risk tomorrow...
1,203 views
R. Christopher Whalen
- May 29
- 2 min
The IRA Bank Book | Outlook Q2 2022
The sharp rise in bank stocks in 2021 coincided with a surge in operating income due to COVID. Now we reverse that trend in 2022...
393 views
R. Christopher Whalen
- May 4
- 5 min
Interest Rates, Credit and MSRs
Even as Powell signals willingness to take interest rate targets higher, he has put off a decision on the Fed's balance sheet until June.
469 views
R. Christopher Whalen
- Apr 11
- 5 min
Weak Bank Earnings & Surging Interest Rates = Lower Valuations
Will Fed Chairman Jay Powell fold in terms of further rate hikes if the S&P 500 falls 1,000 points in a day?
486 views
R. Christopher Whalen
- Mar 21
- 6 min
Will SOFR Be the Death of Jay Powell?
If the Fed causes another liquidity crisis as it ends QE and shrinks the balance sheet, then Chairman Powell should immediately resign.
1,339 views
R. Christopher Whalen
- Mar 15
- 5 min
QE, Risk Premia and Option Adjusted Spreads
There a brisk debate ongoing in the fixed income markets over how much the Federal Open Market Committee will raise interest rates and when
841 views
R. Christopher Whalen
- Nov 15, 2021
- 4 min
As the Fed Ends QE, Stocks and Crypto Will Retreat
And in the meantime, we view the end of QE as a net negative for global stocks as well as crypto. Everything is correlated in a crowd.
1,103 views
R. Christopher Whalen
- Oct 12, 2021
- 6 min
Bank Earnings Setup: Rebound to 2020
Many of the better managed financials that we track have become sellers of assets rather than buyers in the past several months.
312 views
R. Christopher Whalen
- Sep 20, 2021
- 11 min
The IRA Bank Book | Q3 2021
In the Q3 2021 edition of The IRA Bank Book, we document the slow destruction of US bank asset and equity returns by the FOMC.
354 views
R. Christopher Whalen
- Aug 19, 2021
- 6 min
Fed Chairman Jay Powell as RobinHood
There is, after all, no free lunch for investors when the Fed is serving the thin meal of Financial Repression
512 views
R. Christopher Whalen
- Jul 12, 2021
- 3 min
Q2 2021 Bank Earnings Setup | GS, JPM, FRC | NIM Lower for Longer
Cheap liquidity c/o the FOMC does little for bank earnings when asset returns are also falling
513 views
R. Christopher Whalen
- May 21, 2021
- 5 min
Fed Prepares to Go Direct with Liquidity
Why did the Fed feel the need to absorb $351 billion in cash yesterday via reverse repurchase (RRP) transactions?
7,178 views
R. Christopher Whalen
- Mar 12, 2021
- 8 min
The Bank Book Q1 2021: Loss Reserve Releases to Boost Earnings
We anticipate significant loan loss reserve releases back into income in Q1 2021 and thereafter as banks adjust their loan loss provisions
439 views
R. Christopher Whalen
- Feb 9, 2021
- 4 min
Don't Fight the Fed -- Yet
Remember when Fed Chair Yellen expressed surprise that more young people were not buying homes?
1,972 views
R. Christopher Whalen
- Jan 17, 2021
- 5 min
Q4 Earnings Update: JPM, Citi & WFC
Unless the FOMC relents and eases up on its massive purchases of Treasury securities and MBS, bank earnings are likely to decline further
298 views
R. Christopher Whalen
- Sep 14, 2020
- 4 min
Financial Repression and Inflation Targets
No matter who wins the presidential election in November, have no doubt that Chairman Powell is the most important man in town...
585 views