Global Investing

It’s the exit, stupid

January 26, 2010

Ghoul

Anyone wondering what ghoul is most haunting investors at the moment could see it clearly on Tuesday — it is the exit strategy from the past few years’ central bank liquidity-fest.

from MacroScope:

Britain heading for rude awakening?

January 20, 2010

 UK_DFTEZ0110

 

There is a divisive election ahead for Britain, the threat of a ratings downgrade on its sovereign debt and a deficit that has ballooned into the largest by percentage of any major economy.  UK stocks, bonds and sterling, however, are trundling along as if all were well. What gives?

RIP 2008-2009

January 4, 2010

It was down, down, down in 2008 and up, up , up in 2009. So what will 2010 bring?

A black swan in the desert

November 26, 2009

Just when investors were settling down to lock in a few of the year’s profits and put their feet up for the end of the year holidays, a black swan has come waddling out of the desert to put everything on edge.

from David Gaffen:

Fed Starts to Remove Candy; Market Demands More

September 24, 2009

The stock market's penchant for emotional reactions that remind one of a roomful of two-year olds can never be underestimated. Major world central banks are pulling back on their efforts to provide liquidity to the financial system, and the U.S. equity market has flipped out, with stocks falling sharply after the news.Volatility has spiked as well, even though the banks' move is largely administrative, with demand for certain borrowing programs already diminished. Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ notes that "demand for dollar liquidity at banks offshore is sharply reduced now that the crisis has blown through. The amount of dollar borrowing in offshore centers is down sharply."

from David Gaffen:

Hair of the Dog Rally

September 17, 2009

The old lore about the best way to cure a hangover is with a few more nips of whatever it was you were imbibing the previous evening, commonly known as "hair of the dog."

from David Gaffen:

Can Stocks and Bonds Celebrate Together?

August 26, 2009

So who is right and who is wrong?The stock market has rallied by more than 50 percent in the last five months. But bond market yields currently hover around 3.4%, and while that's nowhere near close to the crisis-induced record low reached at the end of 2008, a graph of the 10-year note's yield shows that it remains lower than almost any point other than when prices spiked in the wake of the Lehman Brothers collapse.

The Big Five: Themes for the Week Ahead

August 24, 2009

Five things to think about this week:

CENTRAL BANKERS IN A HOLE
– The global economy and financial system appear on the road to recovery but that is in large part due to unprecedented official stimulus that will have to be withdrawn at some point – the questions investors want answered are when, and how.  Central bankers no longer appear to be quite as shoulder to shoulder with one another on coordinated policy as they were last year in the aftermath of Lehman’s collapse.
 

The Big Five: themes for the week ahead

August 10, 2009

Five things to think about this week:

APPETITE TO CHASE? 
- Equity bulls have managed to retain the upper hand so far and the MSCI world index is up almost 50 percent from its March lows. However, earnings may need to show signs of rebounding for the rally’s momentum to be sustained. Even those looking for further equity gains think the rise in stock prices will lag that in earnings once the earnings recovery gets underway, as was the case in past cycles. The symmetry/asymmetry of market reaction to data this week — as much from China as from the major developed economies — will show how much appetite there is to keep chasing the rally higher. 

from MacroScope:

Investor sentiment roadmap

August 7, 2009

Investor sentiment goes through various phases in an economic cycle -- from optimism, euphoria to panic and depression, back to hope and optimism.