It’s good that we don’t take these things literally, otherwise we’d have to believe in something like time travel. Not just believe in it, how someone must’ve mastered it a few years ago. Because, looking back, the most straight-forward interpretation of the eurodollar futures market in June of 2018 was that those trading in it had discovered COVID-19 a year and a half before anyone else would. Way before the strain of coronavirus itself had even mutated into the global pathogen it would eventually be.
Plainly recounting the financial details of that hot June (not for temperatures) almost three and a half years ago does make it seem like the market had been just this prescient. Spot on, actually. The Federal Reserve’s policymaking conference, the FOMC, had finished up its scheduled two-day gathering on the 13th, and when it was over the eurodollar futures contract expiring in the month of December 2020 priced below the next three quarterly contracts in line; those of March, June, and September 2021.
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