Global Investing

Dead cat bounce?

January 19, 2009

New year can get in the way of understanding what is happening on financial markets. Just because humans measure the year in 12 month tranches, it does not necessarily follow that markets do. Consider world stocks, for example. MSCI’s all-country world stock index is often cited as having fallen 43.5 percent in 2008. In fact, long-term investors’ losses were a lot worse. From an all-time high on November 1, 2007, to a low on November 28, 2008, the index fell 56.2 percent.

What a web we’ve woven

January 13, 2009

Thanks are due to the World Economic Forum for clearly  explaining the interlinked web of misery currently facing the world.  Make what you will of the details in the graphic below – and if you can, please do let us know! — but the overall impact really does spell it all out.

from Africa News blog:

Forgiveness in paradise?

January 10, 2009

If you lived on an archipelago that defined paradise with palm-fringed white sand beaches and emerald green waters, you would expect a relaxed, lazy pace of life.

A lot of witches but no more crises?

December 19, 2008

As financial markets wrap up the final full trading week of 2008, investors are contending with “quadruple witchings”, that is the day on which stock index futures, stock index options, stock options and single stock futures all expire.

No black tulip bulbs, no black swans

December 10, 2008

The world has experienced many crises in the past.


In 1636, during the Dutch Tulip Bulb Bubble, the quest for a perfect black bulb had inflated the price of a black bulb by many hundreds. In a different crisis in 1866, a London wholesale bank Overend, Gurney & Co collapsed with a massive debt, after expanding its investment portfolio beyond its means.

from Davos Notebook:

Bankers – Ever thought about working for Big Pharma?

December 8, 2008

    Are you an out-of-work banker looking for a new job with
some stability? Considered the drugs industry?

Recession is no secret

December 5, 2008

Mike Trudel, U.S.-based managing director and senior product specialist at BlackRock, has become convinced the economic recession really has arrived.

Not going back to platform days

December 3, 2008

Deflation seems to have replaced inflation as the public enemy No.1 these days.

This might give relief to quite a number of people, including those who thought the resurgence of inflation could take us back to the 1970s.

The Wrong Lesson

December 3, 2008

 

Investors learned the wrong lesson from the dotcom bubble, and ended up blowing another. 

Carry on falling

November 21, 2008

Graphic evidence from Investec Asset Management (below) highlighting the demise of the carry trade. It shows returns from borrowing low-yielding currencies such as Japanese yen to buy high-yielding ones over the past 7-1/2 years or so.  There has been a roughy 50 percent decline since the end of July.