The Daily Feather — Schumann Shined on the Mat

Dating to 3000 BC and featured in the 308 BC ancient Olympics, Greco-Roman wrestling was revived by a German – Carl Schumann – who won the event and three others when the Olympics re-debuted in 1896. Like naming the original Beatles, try recalling the nine events at which 280 athletes, all male, competed from 12 countries. In 43 events including wrestling, medal contenders challenged one another in cycling, swimming, gymnastics, weightlifting, fencing, shooting, tennis, and, of course, track and field. Since the inaugural Olympics, Freestyle Wrestling is among the 23 sports added, and that’s just the summer lineup. Through December 7th, my twins’ birthday, I’m in Culver watching my youngest compete in four Folkstyle wrestling events. I’ve learned that after starving to make weight, to pin your opponent, you must hold them to their back for two seconds. You can only lock your hands while pining or taking down your opponent, but not while riding. That’s called “clasping;” it’s illegal. You can also prevail by being Technically Superior. To do so, you must beat your opponent by 15 points, which are lost for stalling or fleeing the mat if the referee has warned you.

Treasury shorts have clearly fled the mat or are stalling for time to see if their “deficits all of a sudden matter” narrative can revive them. As noted by Mark Gomez, a great friend and 37-year veteran sales trader, “Yields broke down aggressively last week. They barely paused at technical levels. Price action was exceptionally bullish. It trades like a short squeeze, but the market isn’t short. This is more akin to a phase transition, a turning point of a long-term trend.” And why the regime change you ask? “The market’s reaction function is greater to weaker data and neutral talk, than inflation or ‘might need one more hike’ kind of FEDspeak.”

Starting with the soft data, with all Federal Reserve Districts’ manufacturing surveys in hand, we can get a good feel for where we are in the inventory cycle. By aggregating and averaging the Future Inventories of the New York, Philadelphia, Richmond, Kansas City, and Dallas Feds, we can proxy where factory managers foresee demand a year out. To give you a feel for how strong that perspective was, on March 12, 2021, U.S. households received their third stimulus check from Uncle Sam.