Morning Rundown | What is Bitcoin Worth in Gold?

Feb 11, 2022

∙ Paid

Housekeeping: Due to Football festivities this weekend’s Founders class will be on Saturday. The session will be a rundown of the week’s CoT report for Silver and Gold. Seems last week’s was very helpful for using this extremely important tool in markets.1

Market Rundown

Good Morning. The market is whippy and emotional but contained this morning. Stocks, bonds, and commodities all sell off together when the market is scared of a rate hike.

Minutes later the dollar sells off, Bonds rally a little, and stocks run up off their lows taking commodities with them. The market is digesting what it thinks will happen next. That is all this is.

Fed speakers will have more pronounced effect on markets until the actual rate hike comes. Think of market participants as information junkies with no new information. So they hang on every word spoken.

The phrase “emergency rate hike” is now out there. You will see it more no doubt since it is good for advertising clicks. It’s the equivalent of “terror attack” to finance folks. It could happen. But is it an “emergency” if the press has time to debate it for a week first?

Data may matter too much today

cheers

Premium Post Excerpt

Bank: Our fair value for bitcoin based on a volatility ratio of bitcoin to gold of around 4x would be $38k modestly below its current price. In an upside scenario where there is more normalization in vol to around 3x, the fair value…

Premium Beneath the Fold

Guest Post:

We put up a reaction post to the wacky CPI reactions yesterday on Zerohedge:

CPI Fallout: Bizarro World Ends With Gold and Bitcoin Much Higher

Guidance

The surge in U.S. consumer prices by more than forecast in January is adding to expectations that the Federal Reserve will raise rates soon and quickly. Goldman Sachs Group Inc. now sees seven 25 basis points hikes in 2022, one for every meeting left in the year. Traders are also pricing close to even odds of a 50 basis points move at the March meeting. Yesterday, Federal Reserve Bank of St. Louis President James Bullard, an FOMC voter this year, only added to that speculation when he said he like to see a full percentage point of tightening by July 1. He also raised the possibility of a move between scheduled meetings.

- Bloomberg