Stock Traders D...'s  Instablog

Although I believe TBT will eventually work, we cannot fight the trend.  We stopped out of TBT.  We are now in SKF, TWM, with defined targets and risk controls.  We are also considering additional short - side ETFs.  Login to the members area for live updates if you desire.

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I am noticing a recurring theme around the world. This is subtle, yet
right to the point about the global economy. Canada is an excellent
place to start, and a good example. Toronto has been bustling. There
are bidding wars for real estate, and the economy seems to be
flourishing. However, after a 45 minute drive down the 403 another
economic environment exists. You cannot sell a home in Ancaster. The
same is true for England. London is bustling, almost like nothing was
wrong, but a few miles away the real truth is more evident. Again,
Athens was similar, but the pain was clearer on the faces of the public
there.

Still, I have found this theme to be telling. An investment banker from
Barclays told me that the reason London was doing well is because every
billionaire in the world wants a flat in London. I look at a different
way. Business people realize that the economy may indeed recover in the
big cities, but the rural areas are a completely different story. In
fact, price wars are popping up in rural areas, and that brings down
margins. This is true, it seems, everywhere but the big cities. People
still have jobs in the big cities, they have money to spend, but
everywhere else is different. Outside of the cities, people are
struggling, unemployment is high, and everyone is budgeting.

With that observation, I am beginning to formulate opinion. The
economies of the world are in a stage in which businessmen are
repositioning to where the money is. More of them are moving to the big
cities, and that is causing a noticeable growth in cities like Toronto.
They hope to find business there, and make a good living again, because
they cannot afford the same lifestyle outside of the city right now. To
me, that is a material shift in lifestyles. To me, that is proof of
just how bad the real economy may actually be.

When have you known a person who has made a life outside of a city elect
to move to the big city again? Aside from younger generations, most
adults who live outside of big cities do it because they prefer the more
peaceful environments. The decisions to move to a big city is not easy,
it reminds me of another time in history, a tough time. Do you have any
idea what that is?

Good Trading.

THK.


Disclosure: skf, twm, qid have been recommended. Author has not conflicts to report.

Disclosure: no conflicts to report.