Posts Tagged U.S. Dollar
Monthly Strategy – September 2010
Posted by Belisarius in Monthly Strategy on September 3, 2010
Equities
Economic data released in recent month or so is on a absolute and relative basis weak. The difference from July is that the consensus has moved downwards, so the markets focuses on comparing actual data with consensus and disregarding absolute levels.
But we are here to earn some money, not waste our time on lamenting whether someone (in this case consensus) is right or not.
Economic data released in recent month points to only marginal and slowing growth. Consumer demand proxies point to deceasing level of consumer demand. Unemployment is high and it is not falling. The government stimulus is wearing off.
Monthly Strategy – August 2010
Posted by Belisarius in Monthly Strategy on August 2, 2010
Equities
Economic data released in recent month or so is dominated by bellow consensus readings and on absolute level pointing to only marginal and slowing growth. Consumer demand proxies point to deceasing level of consumer demand. Unemployment is high and it is not falling. The government stimulus is wearing off.
But the market is rising despite all of that and contrary to my (correct) macro calls.
I still believe that the market is overvalued; I believe that there is disconnect in what equity and bond markets are pricing – with equity being wrong; I believe we will correct to sub 900 level in the S&P 500.
Monthly Strategy – July 2010
Posted by Belisarius in Monthly Strategy on July 3, 2010
Almost unchanged from June.
Equities
Only extremely favorable economic data could change the negative trend established. This is highly unlikely. So I would say we will soon see S&P 500 at 875.
On a macro level, the stimulus is wearing off, politicians and central bankers are not ready to continue with loose fiscal an monetary policies, just the opposite, austerity is the game. For now.
Private demand is weak. Private investments also show no strength. Real-estate is burdened with unsustainable debt levels, still to high prices and weak demand. Without real-estate investment recovery, we cannot talk on sustainable and historically high economic growth rates.
China / U.S. / U.K. Currency Stand-Off In 1930s
Posted by Belisarius in Markets on June 23, 2010
Very interesting comment in the todays Financial Times dealing with the China/U.S./U.K. currency stand-off in 1930s. The roles are a little bit changed but the lessons learnt are interesting in todays context.
Finacial Times article: Lessons from the 1930s for a rising renminbi.
Monthly Strategy – June 2010
Posted by Belisarius in Monthly Strategy on June 9, 2010
Little late…but better late then never…
Equities
Only extremely favorable economic data could change the negative trend established. This is highly unlikely. So I would say we will soon see S&P 500 at 900.
On a macro level, the stimulus is wearing off, politicians and central bankers are not ready to continue with loose fiscal an monetary policies, just the opposite, austerity is the game. For now.
Private demand is weak. Private investments also show no strength. Real-estate is burdened with unsustainable debt levels, still to high prices and weak demand. Without real-estate investment recovery, we cannot talk on sustainable and historically high economic growth rates.
Monthly Strategy – May 2010
Posted by Belisarius in Monthly Strategy on May 5, 2010
Equities
With my 1,200 S&P 500 target reached I’ve moved to a kind of a ambiguous stance to the markets. Now I believe the equity markets are bound for a 10%+ down move at least.
My mid-term view remains unchanged – this is just a bear market rally; U.S. and E.U. economies will experience same patterns in both economy and markets as Japan in ‘90ies.
Recent pickup in consumer spending was due to decreased savings rate, not income growth, so I believe it is unsustainable mid term. The inventory cycle has ran its course, government stimulus is wearing off. A slower GDP growth is almost certain for the second half of the year.
Monthly Strategy – April 2010
Posted by Belisarius in Monthly Strategy on April 1, 2010
Equities
Although I’m convinced that the economy is not pulling a V-shaped almost everywhere except in China and in their commodity based economy satellites I believe that in the short term the equity gains will continue. I have a 1200 S&P 500 target.
I have only a small exposure to the markets (via a June SPY 105/106 put ratio backspread) to keep interest for the markets. It’s performing bad.
My mid-term view remains unchanged – this is just a bear market rally; U.S. and E.U. economies will experience same patterns in both economy and markets as Japan in ‘90ies.
Monthly Strategy – March 2010
Posted by Belisarius in Monthly Strategy on March 1, 2010
Equities
In the macro arena we have leading indicators rolling over, and a stream of worse-than-expected data pieces on U.S. housing, U.S. employment, U.S. durable goods ordered and large move lower by consumer confidence.
Seems that the markets do not appreciate the data. Things that move the markets are only FED policy on rates, dollar strength and Greece debt problems. China credit tightening in forgotten for the time being (at least to the next announcement).
Targets
Posted by Belisarius in Markets on February 9, 2010
One of the most important piece of data being reported this week is Chinese money supply. When giving a little thought to the meter, it gives a negative impulse to the markets turned both ways. If the growth continues we have asset bubbles forming and inflation threat; If growth slows down we have a threat that China investment driven economic model collapses globally subdued demand for everything China imports. I will be interesting to see how the markets will react, in my view it could only be negative.
Interesting exercise David Rosenberg made yesterday in Gluskin Sheff economic commentary:
Greece Again
Posted by Belisarius in Markets on February 8, 2010
Markets still focus on Europe and in particular Greece. There are some rumors today that Unicredit and Deutsche bank have ceased to accept Greek government bonds as a collateral; there are also some rumors that the capital flight from Greece is reaching alarming levels. It looks the Greece story is approaching its climax and we will soon witness a bailout or a default (probably by a one or more Greek banks followed by sovereign default).
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