Managing Director

Elan Gore

TMI Data Science

TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade & traditional media.  Our proprietary software, TMI Machine, is a text-mining platform designed with the buy-side & capital markets professional in mind, text-mining the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income & individual equities.  TMI provides custom leading indicators and systematic trading strategies, operating at the nexus of linguistics & statistics drawing on vast experience in investment banking and hedge fund settings in senior quantitative and fundamental roles.  

TMI Data Science was founded by Elan Gore, an award-winning Senior Global Basic Materials Equity Analyst & China Economist with 15 years of experience in North American hedge funds & institutional managers; and Alessandro Porrino, Ph.D., an Algorithmic Trading Analyst and Programmer with 10 years of front-office experience ranging from complex FX option pricing to auto-hedging strategies at Bank of America Merrill Lynch and Standard Chartered.  Mr. Gore holds an MBA in Finance from New York University Stern School of Business, and Mr. Porrino holds a Ph.D. in Systems Engineering from Brunel University London.

Commodities

<ul>
<li>Last month our text-mined indicators highlighted a notable raw materials restocking underway for the second time since August; this theme did not slow down throughout December, ending the month at a new high</li>
<li>Though with very little discernible impact on commodities, our indicators saw Chinese macro sentiment peak earlier in December at +3x STDEV with some momentum lost on the margin since, driven by below-consensus Chinese retail sales and home price readings, continuing in recent days on lower-than-expected NBS and Caixin PMI releases</li>
<li>In the context of USD weakness, a wildly inflationary mindset in markets and a general restocking, commodity optimism has not wavered </li>
<li>Our commodity sentiment indicators saw broader momentum in December, with already-surging copper momentum joined by crude, aluminum, uranium and nickel; iron ore and steel may be coming off the boil, but markets remain extraordinarily tight</li>
<li>Gold sentiment appears to have fully stabilized after the post-election risk-on shock</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


Last month our text-mined indicators highlighted a notable raw materials restocking underway for the second time since August; this theme did not slow down throughout December, ending the month at a new high
Though with very little discernible impact on commodities, our indicators saw Chinese macro sentiment peak earlier in December at +3x STDEV with some momentum lost on the margin since, driven by below-consensus Chinese retail sales and home price readings, continuing in recent days on lower-than-expected NBS and Caixin PMI releases
In the context of USD weakness, a wildly inflationary mindset in markets and a general restocking, commodity optimism has not wavered 
Our commodity sentiment indicators saw broader momentum in December, with already-surging copper momentum joined by crude, aluminum, uranium and nickel; iron ore and steel may be coming off the boil, but markets remain extraordinarily tight
Gold sentiment appears to have fully stabilized after the post-election risk-on shock
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Indicators: Commodity Sentiment Review - Restocking On, But China Macro Momentum May Have Peaked

Cross Asset Strategy

<ul>
<li>We examine a range of gold-related custom indicators to chart the thematic catalysts for gold's persistent weakness since August</li>
<li>Inflation hedging interest is back, having last spiked with gold in early August; but as our text-mining highlights, inflation hedging is now primarily associated with cryptocurrencies rather than precious metals </li>
<li> Gold saw a post-election false start which was abruptly halted by a barrage of vaccine news, and more recently hints of an orderly presidential transition; as a result of lingering post-election dissonance, our diffusion of positive vs. negative gold commentary does not point to imminent reversal from recent negative trends</li>
<li>Global financial media discussion of stimulus has dropped to a YTD low, which appears to be strongly correlated with gold's recent move, replaced by a spike in discussion of easing financial conditions</li>
<li>After a September-October hiatus, we see an upward slope in our text-mined weak-USD expressions indicator in recent weeks, though far less dramatic than the multi-STDEV spike seen over the summer</li>
<li>Mentions of tail risk hedging declined to a 14-month low, having peaked in early April</li>
<li>With gold/SPX T6M correlation running at a decade-high +87% in September, gold's traditional "uncorrelated" portfolio function has been called into question for good reason; similarly, positive gold/USD correlations in the past 3-4 months have not inspired confidence, but given the short interval this does not stand out as abnormally dysfunctional</li>
<li>Overall, we see gold-positive inflation hedge demand, persistent pressure on USD and easing financial conditions as currently more than offset by gold's recent dysfunctions, BTC's emergence as competing inflation hedge, lack of interest in tail risk hedging and falling stimulus expectations; we see short-term downside limited to ~1x STDEV or $1700-1725/oz based on the current data set, following significant unwind of speculative interest and ETF outflows</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


We examine a range of gold-related custom indicators to chart the thematic catalysts for gold's persistent weakness since August
Inflation hedging interest is back, having last spiked with gold in early August; but as our text-mining highlights, inflation hedging is now primarily associated with cryptocurrencies rather than precious metals 
 Gold saw a post-election false start which was abruptly halted by a barrage of vaccine news, and more recently hints of an orderly presidential transition; as a result of lingering post-election dissonance, our diffusion of positive vs. negative gold commentary does not point to imminent reversal from recent negative trends
Global financial media discussion of stimulus has dropped to a YTD low, which appears to be strongly correlated with gold's recent move, replaced by a spike in discussion of easing financial conditions
After a September-October hiatus, we see an upward slope in our text-mined weak-USD expressions indicator in recent weeks, though far less dramatic than the multi-STDEV spike seen over the summer
Mentions of tail risk hedging declined to a 14-month low, having peaked in early April
With gold/SPX T6M correlation running at a decade-high +87% in September, gold's traditional "uncorrelated" portfolio function has been called into question for good reason; similarly, positive gold/USD correlations in the past 3-4 months have not inspired confidence, but given the short interval this does not stand out as abnormally dysfunctional
Overall, we see gold-positive inflation hedge demand, persistent pressure on USD and easing financial conditions as currently more than offset by gold's recent dysfunctions, BTC's emergence as competing inflation hedge, lack of interest in tail risk hedging and falling stimulus expectations; we see short-term downside limited to ~1x STDEV or $1700-1725/oz based on the current data set, following significant unwind of speculative interest and ETF outflows
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshot: Text-Mining the Thematics Behind Gold's Disappointing Fall

<ul>
<li>In last month's report we saw late-September USD strength contribute to softer base metals sentiment and a collapse in precious metals sentiment (amid reports of millennial preference for cryptocurrencies as an inflation hedge)</li>
<li>More recently, we saw copper sentiment surge to &gt;3x STDEVs, a multi-year record on our data, as financial media preoccupation with relative Chinese macro strength and strong EV demand met persistent newsflow on imminent labor-related supply disruptions in Chile; our back-testing suggests such anomalous sentiment readings normally lead to temporary pullbacks in the copper price</li>
<li>Gold &amp; silver sentiment fell further in October to levels last seen in April, but we see early signs of bottoming in gold; platinum sentiment improved on hydrogen economy news </li>
<li>Crude oil sentiment fell to its lowest since May, predictably attributed to the prospect of COVID-19 lockdowns spreading globally &amp; Libyan news</li>
<li>Iron ore sentiment has moved into positive territory in the final week of October, driven by 3 consecutive weeks of steel inventory draws in China and a notable rally in rebar prices</li>
<li>Despite deteriorating COVID-19 newsflow, crude weakness and USD strength, sentiment is positive on more commodities relative to late September, with supply disruptions and greater conviction on Chinese macro the key drivers</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


In last month's report we saw late-September USD strength contribute to softer base metals sentiment and a collapse in precious metals sentiment (amid reports of millennial preference for cryptocurrencies as an inflation hedge)
More recently, we saw copper sentiment surge to &gt;3x STDEVs, a multi-year record on our data, as financial media preoccupation with relative Chinese macro strength and strong EV demand met persistent newsflow on imminent labor-related supply disruptions in Chile; our back-testing suggests such anomalous sentiment readings normally lead to temporary pullbacks in the copper price
Gold &amp; silver sentiment fell further in October to levels last seen in April, but we see early signs of bottoming in gold; platinum sentiment improved on hydrogen economy news 
Crude oil sentiment fell to its lowest since May, predictably attributed to the prospect of COVID-19 lockdowns spreading globally &amp; Libyan news
Iron ore sentiment has moved into positive territory in the final week of October, driven by 3 consecutive weeks of steel inventory draws in China and a notable rally in rebar prices
Despite deteriorating COVID-19 newsflow, crude weakness and USD strength, sentiment is positive on more commodities relative to late September, with supply disruptions and greater conviction on Chinese macro the key drivers
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Indicators:  November Commodity Sentiment - Base Overshoots, Ferrous Improves, Gold Bottoming?

<ul>
<li>Last month our sentiment indicators pointed to potential over-exuberance in copper and platinum, early signs of improvement in corn, and an accelerating slide in crude</li>
<li>Copper sentiment has since pulled back to neutral territory, but the magnitude of the pullback was limited as momentum readings remained mildly positive throughout the month; other base metals saw sentiment pull back to a lesser extent, even as the nickel price underperformed on TSLA news flow</li>
<li>Corn has seen improvement in sentiment driven by news of better ethanol margins and potential crop damage in Northeast China driving greater US export demand</li>
<li>Precious metals sentiment collapsed, with silver sentiment dipping below -2x STDEVs to the downside and gold hitting -1.3x STDEVs this week</li>
<li>Crude sentiment attempted to stabilize in the past 2 weeks, but renewed fears of mobility restrictions are surfacing in recent days as negative catalysts in our news attribution; we also identify a very high correlation between crude sentiment and our global foot traffic indicator</li>
<li>From a broader macro perspective, we continue to see pressure on inflation expectations in our text-mined diffusion indices; but since the DXY hit a short-term high of 94.8 on 9/25, we have seen a slight lift in 5-yr TIPS breakevens which is providing some relief to the complex</li>
<li>Our main takeaway this month is the resilience of palladium an copper to recent swings in sentiment, unexpected USD strength and elevated vol in the complex; both commodities have behaved well in the face of considerable headwinds and potentially reflect a steadier underlying recovery in manufacturing, construction and autos</li>
<li>Overall, less than half of our commodity sentiment indicators are in positive territory, compared with the vast majority last month</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


Last month our sentiment indicators pointed to potential over-exuberance in copper and platinum, early signs of improvement in corn, and an accelerating slide in crude
Copper sentiment has since pulled back to neutral territory, but the magnitude of the pullback was limited as momentum readings remained mildly positive throughout the month; other base metals saw sentiment pull back to a lesser extent, even as the nickel price underperformed on TSLA news flow
Corn has seen improvement in sentiment driven by news of better ethanol margins and potential crop damage in Northeast China driving greater US export demand
Precious metals sentiment collapsed, with silver sentiment dipping below -2x STDEVs to the downside and gold hitting -1.3x STDEVs this week
Crude sentiment attempted to stabilize in the past 2 weeks, but renewed fears of mobility restrictions are surfacing in recent days as negative catalysts in our news attribution; we also identify a very high correlation between crude sentiment and our global foot traffic indicator
From a broader macro perspective, we continue to see pressure on inflation expectations in our text-mined diffusion indices; but since the DXY hit a short-term high of 94.8 on 9/25, we have seen a slight lift in 5-yr TIPS breakevens which is providing some relief to the complex
Our main takeaway this month is the resilience of palladium an copper to recent swings in sentiment, unexpected USD strength and elevated vol in the complex; both commodities have behaved well in the face of considerable headwinds and potentially reflect a steadier underlying recovery in manufacturing, construction and autos
Overall, less than half of our commodity sentiment indicators are in positive territory, compared with the vast majority last month
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Indicators: October Commodity Sentiment - Base Neutral, Precious Weak, Palladium & Corn Positive

<ul>
<li>Last week we highlighted a downward shift in US inflation expectations, and our diffusion index of inflationary vs. deflationary expressions continues to soften (see <a href="https://www.smartkarma.com/insights/tmi-snapshot-cross-currents-in-the-us-rental-market-hint-at-pausing-inflation-expectations" target="_blank" data-smartkarma-citation="insights:43259" rel="noopener">TMI Snapshot:  Cross-Currents In The US Rental Market Hint At Pausing Inflation Expectations)</a>
</li>
<li>We believe this shift is largely responsible for unwelcome USD strength and recent pressures on precious metals as well as the overall commodity complex (as noted in <a href="https://www.smartkarma.com/insights/tmi-indicators-gold-sentiment-seeking-catalysts-following-latest-leg-up-on-us-benefit-expiration" target="_blank" data-smartkarma-citation="insights:43356" rel="noopener">TMI Indicators: Gold Sentiment Seeking Catalysts Following Latest Leg Up On US Benefit Expiration</a>)</li>
<li>While our inflation expectations note focused on emerging pressures in the US rental market and their impact on TIPS inflation breakevens, we must acknowledge that the psychology behind the emerging consensus inflationary mindset went into overdrive when extraordinary open-ended QE was perceived to be augmented by continued massive fiscal support and accelerated COVID-19 vaccine news flow</li>
<li>Our text mining sees an unprecedented spike in US political divisions coinciding with a sharp step down in fiscal stimulus expectations, as well as lowered expectations on the near-term availability of a COVID-19 vaccine</li>
<li>With two pillars of the emerging inflationary mindset now broken, the underlying narrative is seeing significant near-term challenges</li>
<li>As a potential post-election silver lining, our text mining sees a shift in perceptions of a Biden win from potentially disinflationary to inflationary (as Biden tax implications are now seen as less onerous and infrastructure investment potentially larger)</li>
<li>As long as uncertainty on post-election outcomes lingers, we suspect disinflationary pressures drive elevated vol, a stronger USD, continued pullback in precious metals &amp; the broader commodities complex, and a near-term shift away from the incipient cyclical/value rotations</li>
</ul><div class="content-highlight"><p>TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. </p></div>


Last week we highlighted a downward shift in US inflation expectations, and our diffusion index of inflationary vs. deflationary expressions continues to soften (see TMI Snapshot:  Cross-Currents In The US Rental Market Hint At Pausing Inflation Expectations)

We believe this shift is largely responsible for unwelcome USD strength and recent pressures on precious metals as well as the overall commodity complex (as noted in TMI Indicators: Gold Sentiment Seeking Catalysts Following Latest Leg Up On US Benefit Expiration)
While our inflation expectations note focused on emerging pressures in the US rental market and their impact on TIPS inflation breakevens, we must acknowledge that the psychology behind the emerging consensus inflationary mindset went into overdrive when extraordinary open-ended QE was perceived to be augmented by continued massive fiscal support and accelerated COVID-19 vaccine news flow
Our text mining sees an unprecedented spike in US political divisions coinciding with a sharp step down in fiscal stimulus expectations, as well as lowered expectations on the near-term availability of a COVID-19 vaccine
With two pillars of the emerging inflationary mindset now broken, the underlying narrative is seeing significant near-term challenges
As a potential post-election silver lining, our text mining sees a shift in perceptions of a Biden win from potentially disinflationary to inflationary (as Biden tax implications are now seen as less onerous and infrastructure investment potentially larger)
As long as uncertainty on post-election outcomes lingers, we suspect disinflationary pressures drive elevated vol, a stronger USD, continued pullback in precious metals &amp; the broader commodities complex, and a near-term shift away from the incipient cyclical/value rotations
TMI Data Science utilizes Natural Language Processing to build custom leading indicators using unstructured data sourced from the global financial, trade &amp; traditional media. Our proprietary software text-mines the global media to discern and quantify nuanced qualitative shifts in press coverage as they apply to macroeconomics, equity indexes/ETFs, commodities, currencies, fixed income &amp; individual equities. 

TMI Snapshots:  More Signs Of Pressure on Inflation Expectations, USD Upside, And A Silver Lining

United States

Silver is the metallic element with the atomic number 47. Its symbol is Ag, from the Latin argentum, derived from the Greek ὰργὀς (literally "shiny" or "white"), and ultimately from a Proto-Indo-European language root reconstructed as *h₂erǵ-, "grey" or "shining". A soft, white, lustrous transition metal, it exhibits the highest electrical conductivity, thermal conductivity, and reflectivity of any metal. The metal is found in the Earth's crust in the pure, free elemental form ("native silver"), as an alloy with gold and other metals, and in minerals such as argentite and chlorargyrite. Most silver is produced as a byproduct of copper, gold, lead, and zinc refining.

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TMI Indicators: Commodity Sentiment Review - Restocking On, But China Macro Momentum May Have Peaked

TMI's commodity sentiment indicators saw improved breadth in December as restocking continues to drive reflation; but China macro momentum may have...

Elan Gore

TMI Snapshot: Text-Mining the Thematics Behind Gold's Disappointing Fall

We chart the thematic catalysts for gold's persistent weakness since August with a range of gold-related custom text-mined indicators, offering...

Elan Gore

TMI Indicators: November Commodity Sentiment - Base Overshoots, Ferrous Improves, Gold Bottoming?

Our text-mined commodity sentiment indicators see an overshoot in copper sentiment, a notable turnaround in iron ore sentiment, and potential signs...

Elan Gore

TMI Indicators: October Commodity Sentiment - Base Neutral, Precious Weak, Palladium & Corn Positive

Last month our sentiment indicators pointed to potential over-exu

Elan Gore

TMI Snapshots: More Signs Of Pressure on Inflation Expectations, USD Upside, And A Silver Lining

Last week we highlighted

Elan Gore

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