Let me just admit to it upfront. Last week didn’t play out according to my macro thesis. The US cycle suddenly showed signs of weakness in surveys, which alleviated some of the pressures in USD rates and in USD versus Asian FX. After having been on a roll for a while, I guess I can live with a week in the role of comical Andreas.

After sub-50 readings in both ISM surveys, the recession chatter is all the sudden back and while I am probably guilty of a recession cry wolf or two in history, it’s generally been an extremely profitable idea to chase recessions in recent years.

It seems to me that we are approaching another highly interesting contrarian bet on a rebound in the (liquidity) cycle right when everyone gets scared of the recession risks (again).

Hallelujah! Let’s have a look at the details.

Chart 1: Nothing in actual spending data rhymes with the weakness in ISM Services