YESTERDAY’S TOP SELECTIONS FROM SEEKINGALPHA.COM’S GLOBAL AND FX CURRENTS WITH MY COMMENTS AND RAMIFICATIONS
TWO MINUTE READ GIVES YOU THE WORLD
Here's the must know events from yesterday's global markets with my own thoughts on the meaning and ramifications for traders and investors;
“Saying the government is trying to satisfy international authorities at the expense of the population, Portugal's Left Bloc may put forth a censure motion against Prime Minister Sócrates that could force him from office. Public discontent is rising as well, with a series of strikes planned and just 9% having faith in the government”
COMMENTS & RAMIFICATIONS: BEARISH FOR EUR LONG TERM, ADDS TO GROWING PIIGS POLITICAL INSTABILITY ALREADY PRESENT IN IRELAND, GREECE. NO IMMEDIATE IMPACT ON MARKETS BUT BEARS WATCHING.
TAGS: SPY SDS EUO FXE, FXA BNZ EU DEBT CRISIS
“South Korea (EWY) joins Hong Kong (EWH), Taiwan (EWT), and India (a few) as Asian equity markets that have broken below long term uptrend lines. Not a consolidation for another attempt at new highs, Daryl Guppy calls this retreat "larger and more significant."
COMMENTS & RAMIFICATIONS: BEARISH FOR GLOBAL MARKETS AS THESE MARKETS HAVE LED WESTERN MARKETS LOWER IN THE PAST, IN ANY CASE IS A BEARISH DIVERGENCE FROM WESTERN STOCK INDEXES. CALLS WESTERN STOCK UPTRENDS INTO QUESTION – JUST WATCHING FOR NOW, NOT SHORTING INDEXES YET.
TAGS: SPY SDS EWY EWH EWT ASIAN STOCK INDEXES
We're running out of positive economic surprises to drive the market higher, Pragmatic Capitalist writes. "Given the very high levels of bullishness and analyst expectations of economic data, we could finally be due for an equity market correction... assuming that the Bernanke Put isn’t so firmly entrenched that it overrides any and all historically reliable data." 13 Comments
COMMENTS AND RAMIFICATIONS: OF COURSE MANY HAVE BEEN SAYING THIS FOR MONTHS, INCLUDING THIS AUTHOR- GLOBAL RISK ASSETS HAVE RALLIED BEYOND WHAT UNDERLYING FUNDAMENTALS WOULD JUSTIFY. WARREN BUFFET AND A NUMBER OF MAJOR BANKS HAVE BEEN WARNING THAT STOCK MARKET VALUATIONS ARE TOO HIGH BY VARIOUS HISTORIC MEASURES
IMPLICATIONS: BE READY TO SHORT RISK ASSETS BOTH LONG AND SHORT TERM ONCE WE GET CONFIRMING SIGNS OF A PULLBACK.
TAGS: SPY SDS FXA GLD, IAU CURRENCIES STOCK INDEXES GOLD OIL
“Android (GOOG) is “the next Windows” that will run as much as 65% of the world's smartphones, e-readers and tablet computers in three to four years, tech venture capitalist Mark Volpi believes. “Most of us will have one tablet and one phone, and maybe one reader. Not every child will have a PC, but every child will have a tablet." 1 Comment
COMMENTS AND RAMIFICATIONS: AN ONGOING STORY THAT GOOGLE MAY OVERTAKE APPLE FOR THE SAME REASON IBM PCs BEAT OUT APPLE 20 YEARS AGO – MORE OPEN CODE, MORE FRIENDLY TO DEVELOPERS, LESS CONTROLLING THAN APPLE
TAGS: GOOG, AAPL
“Talk of "burden sharing" and "haircuts" leads Moody's to consider downgrading the subordinated debt of banks across the EU. "These reforms demonstrate the increased willingness ... of governments to share with debtholders the cost of bailing out a failing bank.”
DENMARK HAS ALREADY TAKEN OVER ITS 8TH LARGEST BANK IN RECENT DAYS AND IS TO IMPOSE HAIRCUTS ESTIMATED AS HIGH AS 40% ON BANK BOND HOLDERS
DEBT RESTRUCTURE FOR BOTH EU PIIGS AND BAILOUTS FOR THE BANKS HOLDING THEM (AND POSSIBLE RESTURCTURE ON BONDS OF THOSE BANKS) IS THE ONLY WAY OUT OF THE EU CRISIS. THE RECENTLY EXPANDED EU BAILOUT FUND IS ONLY ANOTHER STOPGAP MEASURE. LENDING MORE MONEY TO THOSE WITH TOO MUCH DEBT IS NOT A LONG TERM SOLUTION – CUTTING THEIR DEBT TO MANAGEABLE LEVELS IS THE ONLY VIABLE SOLUTION.
TAGS: DB STD, EUO FXE ALVG.DE