World Stock Markets 2010

[littledavesab]

from last year

 

Interesting how the markets seem to follow this economic indicator, look at what happened in March and July of this year.

 

to this year

 

uk - SEE LINK FOR PDF & CHART

 

http://www.conference-board.org/data/bcicountry.cfm?cid=2

 

Released: Tuesday, July 13, 2010

 

The Conference Board Leading Economic Index® (LEI) for the U.K. increased by 0.3 percent in May to 102.4 (2004 = 100), following gains of 0.6 percent in April and 1.0 percent in March. Four of the seven components made positive contributions to the index.

 

Said Jean-Claude Manini, The Conference Board Senior Economist for Europe: “The increase in the LEI for the United Kingdom has slowed as a result of weakening confidence. However, unlike the Euro Area, it has failed to drag the index into negative territory. Increasing production will continue to support the recovery in the short term, but both domestic and Euro Area deficit reduction measures will weigh on growth in 2011.”

 

The Conference Board LEI for the U.K. has been increasing for more than a year, but remains 2.3 percent below its June 2007 peak. At the same time, The Conference Board Coincident Economic Index® (CEI) for the U.K., a measure of current economic activity, increased by 0.1 percent in May, after increasing by 0.1 percent in April and 0.2 percent in March. The index now stands at 102.6 (2004 = 100).

 

The Conference Board LEI for the U.K. aggregates seven economic indicators that measure activity in the U.K., each of which has proven accurate on its own. Aggregating individual indicators into a composite index filters out so-called “noise” to show underlying trends more clearly.

 

US is a bit older- again see link page for pdf download

 

http://www.conference-board.org/data/bcicountry.cfm?cid=1

 

Released: Thursday, June 17, 2010

 

The Conference Board Leading Economic Index® (LEI) for the United States increased 0.4 percent in May, following no change in April, and a 1.4 percent rise in March.

 

"The index points to continued, though slower, U.S. growth for the rest of this year," says Bart van Ark, chief economist of The Conference Board. "Public debt and deficits weigh heavily on growth prospects on both sides of the Atlantic. We project a serious slowdown in European growth in 2011, which could further weaken the U.S. outlook."

 

"The LEI for the United States has been rising since April 2009, and though its growth rate has slowed in 2010, it is well above its most recent peak in December 2006," says Ataman Ozyildirim, economist at The Conference Board. "Correspondingly, current economic conditions, as measured by The Conference Board Coincident Economic Index® (CEI) for the United States, have been improving steadily since November 2009, thanks to gains in payroll employment and industrial production."

 

The Conference Board Coincident Economic Index® (CEI) for the United States rose 0.4 percent in May, following a 0.4 percent increase in April, and a 0.3 percent increase in March. The Conference Board Lagging Economic Index® (LAG) for the United States decreased 0.1 percent in May, following no change in April, and a 0.2 percent decrease in March.

 

The leading economic index is 12.0 percent above its most recent trough of March 2009 and it is 4.6 percent above its most recent peak in December 2006. The coincident economic index is 2.0 percent above its most recent trough in June 2009, but it is still 5.4 percent below its most recent peak of December 2007.

[kernull]

I think the DOW topped out, and now is going to slide smoothly into 8200 area

 

http://seekingalpha.com/instablog/481054-k...date-for-26-jul

 

 

[John Doe]

I think the DOW topped out, and now is going to slide smoothly into 8200 area

 

http://seekingalpha.com/instablog/481054-k...date-for-26-jul

Well, my sanp shorts hit my reduced stops to put me out for a flat trade.

 

Seeing what has been happening since, I'm thankful (also I sold my RDSB for a profit, although, they're back at my sell point now too).

 

Think I will sit on the sidelines for the moment as I just can't see a decent risk reward in point for now.

[kernull]

Well, my sanp shorts hit my reduced stops to put me out for a flat trade.

 

Seeing what has been happening since, I'm thankful (also I sold my RDSB for a profit, although, they're back at my sell point now too).

 

Think I will sit on the sidelines for the moment as I just can't see a decent risk reward in point for now.

 

 

I went short the DOW today. Stop at 10572

[littledavesab]

US index update - seems to be a divergence between UK & US here

 

http://www.conference-board.org/press/pres...fm?pressid=3971

 

27 July, 2010

 

The Conference Board Consumer Confidence Index® which had declined sharply in June, retreated further in July. The Index now stands at 50.4 (1985=100), down from 54.3 in June. The Present Situation Index decreased to 26.1 from 26.8. The Expectations Index declined to 66.6 from 72.7 last month.

 

Says Lynn Franco, Director of The Conference Board Consumer Research Center: “Consumer confidence faded further in July as consumers continue to grow increasingly more pessimistic about the short-term outlook. Concerns about business conditions and the labor market are casting a dark cloud over consumers that is not likely to lift until the job market improves. Given consumers’ heightened level of anxiety, along with their pessimistic income outlook and lackluster job growth, retailers are very likely to face a challenging back-to-school season.”

 

Consumers’ assessment of current conditions was more downbeat in July. Those saying conditions are “bad” increased to 43.6 percent from 41.0 percent, however, those saying business conditions are “good” increased to 9.0 percent from 8.4 percent. Consumers’ appraisal of the job market was also more negative. Those claiming jobs are “hard to get” increased to 45.8 percent from 43.5 percent, while those saying jobs are “plentiful” remained unchanged at 4.3 percent.

 

Consumers’ short-term outlook also deteriorated further in July. The percentage of consumers expecting an improvement in business conditions over the next six months decreased to 15.9 percent from 17.1 percent, while those anticipating conditions will worsen rose to 15.7 percent from 13.9 percent.

 

Consumers were also more pessimistic about future job prospects. Those expecting more jobs in the months ahead decreased to 14.3 percent from 16.2 percent, while those anticipating fewer jobs increased to 21.1 percent from 20.1 percent. The proportion of consumers expecting an increase in their incomes declined to 10.0 percent from 10.6 percent.

 

 

[littledavesab]

Another divergence from the US - maybe its just a rebound from the recent lows?

 

The Conference Board Leading Economic Index® (LEI) for the Euro Area Increased in June

26 July, 2010

 

http://www.conference-board.org/press/pres...fm?pressid=3968

 

The Conference Board Leading Economic Index® (LEI) for the Euro Area increased 0.5 percent in June to 111.2 (2004 = 100), following a 0.3 percent decline in May and a 0.8 percent increase in April.

 

Said Jean-Claude Manini, The Conference Board senior economist for Europe: “After declining in May, the LEI for the Euro Area has picked up in June. While the recovery is unlikely to falter in the short-term, the pace of economic growth may ease somewhat. Confidence indicators have been the primary cause of the recent volatility in the LEI, which may affect the impact of austerity measures on growth in the Euro Area in the medium term.”

 

After increasing in June, The Conference Board LEI for the Euro Area is 16.4 percent above its March 2009 trough. Meanwhile, The Conference Board Coincident Economic Index® (CEI) for the Euro Area, which measures current economic activity, remained unchanged in June. The index stands at 102.4 (2004 = 100) according to preliminary estimates*. It increased by 0.2 percent in May and decreased by 0.1 percent in April

----------------------------------------

Japan on other hand

http://www.conference-board.org/press/pres...fm?pressid=3954

 

08 July, 2010

 

The Conference Board Leading Economic Index® (LEI) for Japan decreased 0.6 percent and The Conference Board Coincident Economic Index® (CEI) decreased 0.4 percent in May.

 

The Conference Board LEI for Japan declined for the second consecutive month in May. Stock prices, the six-month growth rate of labor productivity, and new orders for machinery and construction all fell sharply this month. With the decline in May, the six-month growth rate in the leading economic index continued to moderate -- to 7.0 percent (a 14.5 percent annual rate) from November 2009 to May 2010, substantially down from 17.9 percent (about a 39.0 percent annual rate) in the previous six months. Nevertheless, the strengths among the leading indicators have remained very widespread in recent months.

The Conference Board CEI for Japan also fell in May, and all its components declined this month. With this month’s decrease, the growth rate of the coincident economic index has slowed to 1.8 percent (a 3.6 percent annual rate) in the six-month period through May 2010, down from 2.5 percent (about a 5.2 percent annual rate) for the previous six months. At the same time, real GDP increased by 5.0 percent (annual rate) in the first quarter of 2010, up from 4.6 percent (annual rate) in the fourth quarter and 0.4 percent (annual rate) in the third quarter of 2009.

[kernull]

I went short the DOW today. Stop at 10572

 

stopped out last week for a 10 point profit. now put it again @ 10631. stop @ 10676, looking for tuesday to be trend reversal day. maybe i am a bit earlier here, you might want to try tomorrow at NY opening

[John Doe]

Waiting for DOW ~10860 which is the last fib retrace on my FS charts.

 

Also, Sandy J targetting 10800 - 10900 for a pull back.

 

http://www.londonstockexchange.com/private...targetlevel.htm

[kernull]

I have the feeling that a big storm is coming. Markets are so slow today, on thursday. In a rising wedge with euro topping, ahead of unemployment report release. Hmmm....

 

 

[John Doe]

Fed tomorrow, could be the pop and drop.

 

Orders in to sell DOW 10800, with 11050 stop.

 

Range of interest between 10800 - 10900. if 10900 hit on a quick pop, the short will be doubled, but, if 10950 breached, then shorts will be halved, until 11050, the end point.

[drbubb]

LittleDavesab asked:

can I ask you to move over the UK & World stock market threads also - it is good to keep track of markets at a slower pace than DrBubb's diary. These were No's specialty and he did a blindingly good job last year and I sensed from some of his posts that he was frustrated at the lack of contributions from the GEI main board - maybe it would help spark some life..................

My response:

It's a good thread, I agree - Albeit on a slower posting frequency

 

If I move all the good threads from here, will people still come to this section?

If No6 returns, I would call it his diary, and happily move it.

 

Do you want to claim it?

[littledavesab]

LittleDavesab asked:

can I ask you to move over the UK & World stock market threads also - it is good to keep track of markets at a slower pace than DrBubb's diary. These were No's specialty and he did a blindingly good job last year and I sensed from some of his posts that he was frustrated at the lack of contributions from the GEI main board - maybe it would help spark some life..................

My response:

 

 

Hmm "Do you want to claim it?" I have been thinking about that. Given the regard I have for the threads prior to No6's departure I consider that quite an honour, one I am not sure I am worthy of. OK definately not worthy.

 

No6 recently mentioned he might do a blog with a UK market orientation. UK market happens to be my operating ground also.

 

What I would really like is for people to join in the discussion and to keep it differentiated from DrB's diary by centered on more intermediate term trends. I recognise it will need a bit of input on my part to keep it ticking over. Still thinking.

 

[littledavesab]

I know this is too straight for a lot of GEI'ers but you are all welcome to join in .

 

Personally I think this does an excellent job of summing up the situation. For the time being Catflap & VAN might not be the only bulls on GEI where the markets are concerned. (reserves right to change mind if market tanks...)

 

Guy Hands: Why we should be worried about the woes of the world

Fareed Sahloul

 

16 Aug 2010

 

In his latest letter to investors, the high-profile chairman of UK buyout house Terra Firma has written of his concerns about new political risks in the world and the threat they pose to investment. The full text of the letter is published here.

 

http://www.efinancialnews.com/story/2010-0...er-to-investors

 

A colleague of mine used to respond to pretty much any question about the status of any subject by concluding that the answer was finely balanced with a potential to fall either way. As I look at the world today, I find myself having similar thoughts. Whether I consider the stability of global politics or the chances of economic growth in the West, I see fragile balances. The risk is that one of these areas might topple over, setting off a dangerous chain of events.

This backdrop, along with the overhang of equity to invest in the private equity industry, makes successful investing at this time very challenging. While it is still possible to make good private equity investments, potential risks are everywhere, and caution and care are vital. It is clear that engaging in fundamental operational change, a core competency at Terra Firma, is essential to building value in this environment. The last time the world experienced widespread economic concerns prior to mid-2007, private equity enjoyed easily accessible low risk/high return opportunities that generated extraordinary returns for the vintage 2002/3 period. I doubt, however, that this will be repeated in the current environment for the vintage years 2008/9.

 

Let me start with politics. One might argue that the world has always had political crises, will always have political crises, and that history shows that they only rarely develop into horrific events that drag in most of the world such as WWI or WWII. In the last 50 years, one can point to any number of events that might have led to wider conflict such as the Cuban missile crisis, the Vietnam War, the Suez crisis or numerous civil wars, disturbances or confrontations. However, the difference is that, until recently, there was a world political order that helped maintain balance in the world. Until the fall of the Berlin wall, there was the equilibrium of the cold war that created a bi-polar world led by the US and the USSR. Post the collapse of the Soviet Union, there was the uni-polar world led by the US. Now, the world is shifting, rapidly, from American hegemony to a multi-polar world without a truly dominant player or well-defined system of diffusing or containing conflict. The US’s domestic economic issues, combined with its overstretched military brought on by its operations in Iraq and Afghanistan, mean that its ability to diffuse crises and impose order is fading.

 

At the same time, China, India, Brazil and Iran are growing to be true regional powers. A multi-polar world is inherently less stable than a bi- or uni-polar world as there is not a well-defined political will or system to resolve issues. Unfortunately, one need only look at the United Nations to see this is the case. As I look around the world, I find an ever-expanding list of areas of concern. I will pick just three examples where I believe people are not fully aware of the wider risks that could develop if any one of these situations develops into a full flown crisis.

 

Top of the list would be North Korea, a failing state, which is far more dangerous than I think most people realise. Post the sinking of the South Korean naval ship, Cheonan, earlier this year, it has become clear that no-one, not the South Koreans, the Japanese, the Americans or even the Chinese is in a position to keep North Korea in check. While the chance of a full military conflict involving North Korea is still unlikely, I would say the odds are less than 1 in 10, not the 1 in 100 chance that many people seem to think. North Korea only has about 24 million people, but it borders South Korea with 50 million, and there are about 70 million people in China in the provinces on its northern border. Furthermore, at its closest point, Japan is only about 200 miles away with a population of over 125 million. Should the situation deteriorate, we could find a military conflict involving nearly 300 million people while, in contrast, if North Korea was to stabilise and recover it could provide a huge opportunity for South Korea.

 

Moving to the Americas, I would highlight Mexico’s drug war, where the Government has 45,000 troops engaged in fighting the cartels. This situation is steadily worsening. Since 2006, it is estimated that over

 

23,000 people have been killed. What began as a police operation has evolved into a war, which has huge political, social and economic ramifications. If the recent car bomb in July in the border town of Ciudad Juarez is the sign of things to come, then Mexico’s vital manufacturing base along the US border will suffer. Clearly, this area has already suffered from the economic difficulties in the US. Mexico could pose an extremely difficult challenge for the US if the drug war was to continue to escalate or spill over into the US along its nearly 2,000 mile long border with Mexico. Again, the converse is also true as a dynamic and economically growing peaceful Mexico could provide the US with great opportunity.

 

In Europe, I think the economic pressures will bring fresh political challenges to the EU and the countries aspiring to join it. The former countries of Yugoslavia are prime examples of this tension. All of these countries, except for Slovenia, which is already a member, aspire to join the EU. The potential for these countries to enter the EU has brought them a measure of stability and improved living standards over the past decade, and allowed us to forget too easily that this region was wracked with civil war in the 1990s. However, peace and stability in the region remain fragile as demonstrated by rising tensions surrounding Kosovo’s declaration of independence. If Serbia, Bosnia-Herzegovina and Montenegro find their path to EU membership blocked and their banking sectors in trouble, it could well increase the demands in the area on the European peacekeeping mission and the need for additional economic support from the EU. Germany and France are already debating the costs of subsidising the likes of Greece, Spain and Portugal. While the wealthier countries in the EU have not yet moved away from such support, domestic challenges might force their governments to do so. If this pressure caused the wealthier EU countries to shut off the possibility of their poorer neighbours joining their club, it could have real implications for peace in the Balkan region. Alternatively, a Europe that continues to expand peacefully, and has Turkey as a member, could be the most powerful economic group in the world.

 

These are just three examples where I think people are underestimating the volatility of possible results and paying too little attention because they are preoccupied with more visible issues in places like Iran, Pakistan and Afghanistan. Unfortunately, there seem to be many more reasons to be concerned about global stability than to be relaxed. Even in countries which should have bright futures over the next 10 years, such as Canada, China, India, Singapore, Australia, Brazil and the Gulf States, it is easy to see global political concerns impacting them. One used to be able to look at a country and feel that it should be successful for at least one and possibly two generations, but in today’s world that simply is not the case. In the multi-polar world, there is no well understood mechanism for controlling and dealing with problems, which means that even countries that have great economic advantages cannot be certain that they will not be dragged into the unintended consequences of some regional conflict that could become global. While these are not comforting or happy thoughts, I believe investors ignore such political risk at their peril.

 

I am afraid that I also see the Western economic world in a pretty precarious balance. It is true that double-dip recessions are reassuringly rare (in the US for instance only two have occurred in the last hundred years; the first in 1937 and the other in 1981). However, when I look at the current state of the major Western economies, this historical fact provides me with little comfort. The truth is that, given the size of the current downturn, we are in economically unchartered waters. In the US for instance, there has been, from the economic peak to trough, a 6% loss of jobs; a 20% greater fall than in any recession since WWII. The usual prescriptions for fiscal and monetary policy that were developed since the Great Depression are being severely tested. While we have seen a significant amount of stimuli, we have only experienced a tepid amount of economic growth in the West. We have also unleashed a heated debate about whether we are on the verge of a period of increasing inflation or deflation.

 

Another great debate that is going on is whether or not the US, European and UK stock markets are overvalued. Much of the discussion about the prospects for these markets centres on the forecast for economic growth in the West. However, over the last 30 years, the world has steadily become more global and large multinationals that dominate stock market indices have become far less dependent on their domestic economies. Most multinationals have made a concerted effort to increase their independence as much as possible from their domestic economies and governments. Their strategy of building value for their shareholders often involves moving business activities from one continent to another as economic, regulatory, tax and employment circumstances dictate. Thus, a German automobile company can have incredible success outsourcing employment from Germany to China. The company does well and its stock market price improves, but the German economy loses jobs. Similarly, a US international banking conglomerate can achieve the same success by moving US white collar jobs to India. Thus, the future prospects for the majority of leading multinationals will come from their ability to move their cost base from the West to the East. Hence, their very success could be one of the major causes of the decline of Western economies. In other words, rising Western stock markets are no longer an indication of the strength of Western economies, but simply reflect the strength of the leading companies listed on their exchanges.

 

Given these unprecedented circumstances, it is not surprising that so much is being written at the moment about the trade-off between austerity and stimulus. The Keynesians warn that tightening fiscal

 

policy at this point in time will topple the Western economies back into recession. The anti-Keynesians warn that debt levels are at dangerous levels relative to GDP, especially in a time of peace, and that fiscal policy must be tightened. The Economist estimates that US government net debt will be two thirds of its 2010 GDP, and with an estimated 2010 budget deficit of nearly 9% of GDP, the situation will become worse. Britain is in a similar position with an estimated 54% 2010 sovereign debt to GDP ratio, but a 2010 predicted budget deficit of over 10%. The anti-Keynesians argue that unless debt levels are reduced soon, Western countries will find themselves in a debt trap where confidence in their ability to repay their debt will erode, debt costs will soar and a Greek-style downward spiral will ensue. This debate is being waged at all levels; be it between world leaders such as President Obama (Keynesian) and Chancellor Merkel (anti-Keynesian) or the well publicised economic exchange between economist Paul Krugman (Keynesian) and financial historian Niall Ferguson (anti-Keynesian).

 

My view is that the anti-Keynesians are right in the long term. However, I am afraid that tightening fiscal policy in the West may well upset the delicate balance that exists today and tip countries back into recession, but long term, there is no choice. It is simply impossible for economies to continue to amass debt at the current levels without facing dire consequences in the medium and long term and this has to be tackled sooner rather than later.

 

Ireland illustrates how painful such cuts can be. In the fourth quarter of 2008, Ireland knew that it needed to take action given its high level of indebtedness and government expenditure. Despite fiscal tightening of about 5% of GDP in 2009, it still ran a budget deficit of 14.3% of GDP. More public sector cuts in 2010 should reduce government spending by another 2.5% of GDP this year. As a result, the country is on track to have a budget shortfall of 11.5% of GDP this year and is making progress. However, the price of this austerity has been brutal with Ireland’s nominal GDP falling by over 16%.

 

Ireland is an extreme example. However, with confidence falling in the US and the UK, and a population that is highly indebted at a personal level, the consumer is unlikely to fill the space that will be created by the necessary tightening of government expenditure. The populations of many Western countries are therefore going to have to tighten their belts, and accept a lower standard of living if their economies are going to be put on a more sustainable, balanced long-term footing. This is not going to be easy, and I have to admit, I have been pleasantly surprised by how the UK Government is at least starting to grasp the nettle and getting potential support for its tough stance. It is not often I find myself quoting a Luxembourg prime minister, but Jean-Claude Juncker was quite right when he said of politicians ’We all know what to do, but we don’t know how to get re-elected once we have done it.’

 

Given all of the threats that I have outlined and the uncertainty in the world, one would expect that it should be a great time for private equity to buy businesses on the cheap. Indeed, back in 2009 much of the talk was whether investing in the next 24 months would be similar to the period in the 2002/3 vintages when companies could be acquired at attractive prices. The simple truth is that prices have recovered sharply from the 2009 lows and businesses are not cheap. According to the Centre for Management Buy-Out and Private Equity Research at Nottingham University, the average price paid for a European buyout, with an enterprise value of €500 million or above, in the first half of 2010 was more than 17.9x EBITDA – above the 2007 market peak – and these deals were done with debt levels of approximately one third to two thirds equity. Some argue that this is because earnings are depressed. However, as I have said many times, I think the chance of a ’V’-shaped economic recovery and a big upturn in corporate profits is highly unlikely. Thus, the multiples being paid are, indeed, high.

 

Competition for deals is intense and is fuelled by huge levels of uninvested capital which, in June, Preqin calculated stood at over $1 trillion with about $400 billion needing to be invested by the end of 2013. While some credit has returned to the markets, financial engineering cannot turn an expensive deal into a cheap one. These two factors – stock piles of dry powder and limited leverage – are not only driving prices, but are leading to the most extraordinary number of secondary deals. It is far easier for a GP to buy a deal from another GP than it is to execute a public to private transaction or negotiate with an industrial seller. In fact, on this score, the buyout world is beating the record it set in 2007. According to Dealogic, 47% of the value of all buyouts executed in Europe so far this year have been ’pass the parcel’ deals, topping 2007’s figure of 39%.

 

Reducing the capital overhang is by no means easy. It is true that fund raising has slowed dramatically since its peak in 2007, but so too has the pace of investment. According to Preqin, buyout funds only raised $32 billion globally in the first two quarters of this year. However, Preqin’s figures also show that buyout deal volume over the same period was about $70 billion including both debt and equity. If one assumes a 33:66 debt to equity ratio, that means that only about $47 billion of the trillion dollars in dry powder was committed to deals. At this level of deal volume, in combination with investment period extensions, we can expect the private equity market to remain intensely competitive.

 

So where does that leave GPs right now if they want to invest successfully? Well, it means more than ever that they are going to have to be creative, and decidedly contrarian. Unless they want to pay

 

through the nose, they are going to have to find opportunities by looking at businesses and assets differently from the crowd. They are going to have to figure out how to work closely with their portfolio businesses to grow them through operational and strategic change and not on the back of a rising financial tide. And they are going to have to be cautious and patient. There are no prizes at the moment for doing deals quickly as the market is simply not cheap.

 

Investing along these lines will deliver good returns, and just as importantly, uncorrelated results. I am sorry if this letter seems gloomy, but in investing, it is vital to be realistic. I believe the next few years are going to be tough for all asset classes. However, private equity investing based on improving businesses through strategic and operational change will offer the best safe harbour for investment. With patience, discipline and hard work a careful private equity investor can still produce excellent returns.

[John Doe]

Ah, found it, wondered where this thread had gone.

 

So market stubbornly not falling yet (still think there could be strong resistance between 10550 and 10800 on the DOW).

 

Can't seem to find the Sandy J updates on LSE anymore?

 

[littledavesab]

Ah, found it, wondered where this thread had gone.

 

Welcome back JD - I think I have seen Sandy J's name recently has some job at a broker or spreadbetter maybe have a hunt for his day job website maybe he is commentating there now?

 

EDIT = SEE http://www.spreadbettingtowin.com/ http://www.financial-spread-betting.com/Jadeja.html

 

A big welcome to GL

 

By chance the Sikta Pacific newsletter has just been published for July-Aug (yes its in arrears) I usually post it on the World stock markets thread.

 

On reading these its hard to believe Mish's lot are doing too badly, more quite well I think.

 

http://www.sitkapacific.com/files/Sitka_Pa...ient_Letter.pdf

 

Usual deflationist "nonsense" (or not ) - from a cautious investor standpoint its fairly sensible I guess

[littledavesab]

from the Replying to Invitation to Lurkers ... Thoughts on recent changes thread

 

Mainstream media IMHO = seems very confused right now and is not putting out much of a message

Re house prices I am neutral and dont think media is giving it half as much attention as many on GEI! Still I have been trying to avoid mainstream media over the last few months - quite successfully.

 

Still it leaves the question of

 

Gold, yes I am bullish

 

US vs (most) of rest of world. I sense a big difference in economics between US which is struggling slowly and rest of world which is doing a lot better. I think this subject has been missed by most of GEI !

 

Stock Markets - I am still not a trader! Moving in that direction slowly. But so many on GEI seem to believe in a hyper scenario and similtaniously expect a big stock market dip.

The end outcome may be grizzly but I suspect the authorities might be able to drag the thing out for a good number of years. I wonder how long the post March 2009 bounce can continue but continue it does.

 

One thing that has been completely missed (?) by all the traders on GEI (or if mentioned I missed it) is the return of the BID in the market. Companies are getting taken over left right and centre. Potash anyone? Cadburys? The Corporates have money and seem to be spending it. Not that I watched the markets closely before recent times but I remember reading and being impressed by the bear arguments post 2001 and for the market to crawl up a wall of worry. The bid action is starting to give the market foundations IMHO.

 

Globilisation is still in progress and the multi nationals are benefiting from this. The FT100 is now mainly made up of international companies and has a good few resource + PM miners in it.

 

The markets do not always reflect what is happening in the economy.

 

I am ever mindful that UK has only so far benefited from PUBLISHED public spending cuts (ie a target). The actual reality of the situation has not been agreed or published. Will Osborne get all the cuts he wants and if so what will that do? Is the published figure just a opening ploy to be negotiated down (if so would it matter - probably would as Osborne has said without them UK credibility would be shot or words to such effect)? BIG UNKNOWNS. I treat them as that UNKNOWNS, too many on here seem to want to nod nod and wink wink that they know it all before it happens (not directed at DrBubb, many examples exist on le fringe).

 

Still the big thing is confidence. While the confidence exists there is hope! If the markets loose hope in a big way as they did a couple of years back then watch out! So yes I know tomorrow could make the above look very silly indeed...... or it might not!

 

A diversified stragegy may still make sense !

 

Had been meaning to post something like this on the stock markets thread so will put a copy there which is probably more where it belongs.

 

[solar brisbane]

Another bullish view, but an interesting one.

Not sure if anyone cares or if this is the right spot to post this. But Singapore has just made a takeover bid for the asx.

[No6]

Unless anyone objects I think this thread should be unpinned now as it has been dead for about a year.