Macro Dragon: The Fed Loooooooooves US Credit Macro Dragon: The Fed Loooooooooves US Credit Macro Dragon: The Fed Loooooooooves US Credit

Macro Dragon: The Fed Loooooooooves US Credit

Macro 2 minutes to read
Kay Van-Petersen

Global Macro Strategist

Summary:  Macro Dragon = Cross-Asset Daily Views that could cover anything from tactical positioning, to long-term thematic investments, key events & inflection points in the markets, all with the objective of consistent wealth creation overtime.

(These are solely the views & opinions of KVP, & do not constitute any trade or investment recommendations. By the time you synthesize this, things may have changed.)

Macro Dragon: The Fed Looooooves US Credit 


Top of Mind…

  • So we finally get more details on how the Fed is going to be lifting corporate bonds in the US market (outside of ETFs) & it looks like individual corporate bonds will be bought under the SMCCF [Secondary Market Corporate Credit Facility].
  • As well as further details tied to SMCCF including eligibility criteria. Obviously the theme of what we’ve mention in the Dragon all the way from 18th of March - Macro Dragon: Pockets of Value Starting to Show - when we said credit had found a floor, continues as its all about front running the Fed – this is going to not just be a multi-quarter part… but multi-year party! Just look to the ECB who have been buying bonds for years.
  • Again to the folks that say there is a lot of uncertainty out there, yes & no – as said multiple times, there has also never been MORE CERTAINTY… i.e. you can say with 200% probability that monetary policy is set to be accommodative from the Fed & ECB & Fiscal Policy is set to continue to be loose for both the US & EZ.
  • This is a big deal, recall in a pre-C19 world, 80% of the battle is trying to figure out what is happening on FP or MP, and here we know with complete certainty… focus on the 1st principle order of effects from that… as the trends from loose FP & accommodative MP tend to overwhelm a lot of the marginal smaller counter & often bearish trends
  • Don’t get too caught up in the day to day noise – we went up because of liquidity (not because of fundamentals) & we will stay up, to accelerate up because of liquidity & we will also eventually come off because of lack of liquidity – bang for buck having run its course, yet that could be years away… watch the room on the Fed’s BS as a ratio to GDP, using BoJ & Japan as a mirror.
  • And yes once again – nothing is off the table, be it YCC, negative rates nor the Fed/Treasury buying US equities.



On The Radar Today

  • JP: BoJ
  • UK: Claimant Count Change, Avg Erns Index, Unemployment Rate, Gilt Auctions
  • EZ: GER ZEW, GER inflation
  • US: Powell @ 22:00, Clarida @ 04:00, Retail Sales, Capacity Utilization, IP, Biz Inv.
  • NZ: Milk Auction


Start-End = Gratitude + Integrity + Vision. Create Luck. Process > Outcome. Sizing > Idea.




The Saxo Group entities each provide execution-only service, and access to analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Inspiration Disclaimer and (v) Notices applying to Trade Inspiration, Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular, no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Trading in financial instruments carries risk, and may not be suitable for you. Past performance is not indicative of future performance. Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo Markets does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo Markets or its affiliates.

Saxo Markets
88 Market Street
CapitaSpring #31-01
Singapore 048948

Contact Saxo

Select region


Saxo Capital Markets Pte Ltd ('Saxo Markets') is a company authorised and regulated by the Monetary Authority of Singapore (MAS) [Co. Reg. No.: 200601141M ] and is a wholly owned subsidiary of Saxo Bank A/S, headquartered in Denmark. Please refer to our General Business Terms & Risk Warning to consider whether acquiring or continuing to hold financial products is suitable for you, prior to opening an account and investing in a financial product.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products such as Margin FX products may result in your losses exceeding your initial deposits. Saxo Markets does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo Markets does not take into account an individual’s needs, objectives or financial situation.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit

The information or the products and services referred to on this website may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and Services offered on this website are not intended for residents of the United States, Malaysia and Japan. Please click here to view our full disclaimer.

This advertisement has not been reviewed by the Monetary Authority of Singapore.

Apple and the Apple logo are trademarks of Apple Inc, registered in the US and other countries and regions. App Store is a service mark of Apple Inc. Google Play and the Google Play logo are trademarks of Google LLC.