* CNY reval is on the agenda again. From a Chinese perspective it might become a necessity as steps are taken to try and manage this leveraged economy.
On that note, got some info re counterfeiting in China. Alledgedly, if one deducted Chinese growth stemming from counterfeiting, the annual GDP growth would be zero. If one applied "green accounting" all current GDP Chinese growth would be erased as well. So, all in all, deducting these two variables, the remaining net Chinese GDP growth would be negative.
Add to this a highly leveraged, centralised and very corrupt regime and a cowboy style economy you end up with,,,, Russia in the nineties? Only, the variance in livingstandards in China is even greater than in Russia back then, hence the risk of socialtensions and massive political turbulence is higher in China.
What Im trying to say is; In the "short" run the Chinese economy is overvalued and overexposed.
*Oh yes, the Chinese reval.
Well, although there are some bearish winds blowing again, a CNY reval should actually be good for riskappetite. This would definitely disturb the AUD case shortterm. Especially since the AUD would likely be one of the currencies benefitting most from such an event.
Ill return on this issue later on.
* Was a bit quick in going short CBA and Westpac - its just not doable. These stocks are stilll under a shortingban. Wonder why,,,,,, Oh well, Ill try the index instead then - if possible!
* New positions and positionchanges
No changes.
* Other
- Still trying to add a short Australian equity position - well see.
- Pondering the deflation vs inflation, stagflation outlook. Been a deflation "fan" but am currently reassessing.
- CNY revaluation timing. Not good for AUD bears when it happens. Stay posted.
- JPY intervention; Not before 80 in Usd/Jpy. Stay posted.
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
16 August 2010
11 August 2010
The Australian housingbubble - will it bring down CBA and Westpac?
* I havent really noticed much publicity when it comes to the Australian housing bubble.
However, Ive had a look at it and its very,very scary. As always, its a matter of timing, but I believe were getting there before long. Hence, I am selling the Aud as well as the Australian banks CBA and Westpac (they hold 50% of the Australian mortgagemarket). The loan to equity ratio is so high that a 6% writedown of mortgages would wipe out these banks equity. When this housing market heads south, a 6% writedown will be a best case scenario,,,,
Ive got some quite compelling research on the subject. If you´re interested in obtaining it, send me a mail.
* Yesterdays FED comments post the FOMC decision provided a minimum QE outcome.
It is doubtful this will match the high expectations that were build up pre FOMC. The impetus from this for assets should be a weakening one.
* New positions and positionchanges
- Added to my short Aud position
- Looking for the best ETF;s to short CBA, Westpac or ASX 200
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
However, Ive had a look at it and its very,very scary. As always, its a matter of timing, but I believe were getting there before long. Hence, I am selling the Aud as well as the Australian banks CBA and Westpac (they hold 50% of the Australian mortgagemarket). The loan to equity ratio is so high that a 6% writedown of mortgages would wipe out these banks equity. When this housing market heads south, a 6% writedown will be a best case scenario,,,,
Ive got some quite compelling research on the subject. If you´re interested in obtaining it, send me a mail.
* Yesterdays FED comments post the FOMC decision provided a minimum QE outcome.
It is doubtful this will match the high expectations that were build up pre FOMC. The impetus from this for assets should be a weakening one.
* New positions and positionchanges
- Added to my short Aud position
- Looking for the best ETF;s to short CBA, Westpac or ASX 200
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
10 August 2010
Time to change positions
* Its been a great bull ride since June in Equities, Eur, Aud and Oil, not to mention Wheat (ahhh, what a rocket).
However, I feel now is the time to reverse these positions - again.
Why? Well, to me the weaker Usd was a temporary retrieve in any case. The Usd is coming back soon due to a leveling of positions and the markets overpricing of QE is US vs recovery in Europe. Hence , I believe we will see a relative shift in long term rates favouring the Usd.
I am going long the Usd.
* The China syndrome - soon in Australia?
Australia is to suffer on the back of continued Chinese tightening as well as continued weakening Chinese assetmarkets. According to research, Chinese GDP growth is 100% due to the domestic industry of making fake brands. At least that makes me quite worried. Top it off with a very centralised structure, high leverage, insane capital allocation and you have the recipe for a real bubble burst with a bang. On the positive side; Basel 3 will likely mean an increased allocation from banks into reserve currencies such as the Aud. Short term, however, Im a seller of Aud.
* Equities still in a range - but its about to move lower within it.
Equities will still be looking good from a capital allocation model point of view, but short term I believe the market has gotten ahead of itself. Europe is not out of the woods - not by far.
I am going short European Equity indexes.
* While Oil may very well be in short supply going forward, the Gulf issue is overplayed and so is the demand for now. Im going short Brent Oil.
* The Wheat panic rocket is falling back to Earth - ish. Beware of setbacks.
However, with the recent move and the Russian wheat export stop and bad harvests already discounted by the market and a very, very swift move higher. I am at least looking for a correction lower before we get a top out test of the former high. Caution warranted though. Proper strict riskmanagement should be applied, as always.
* SouthAfrica - the Worldcup is over and the shine has faded. Whats left? A corrupt government, trying to silence the press in order to make room for murky deals and yet more corruption. This country was meant to set an example for the rest of Africa, leading openness,transparency, education, social responsibility and growth. Now its heading the other way. Mandelas legacy is fading fast. On top of it, neither the World Cup, nor the Olympic games are rarely an economic success for the hosting country, rather the opposite. I doubt it will be different for South Africa.
I am buying Usd/Zar.
* Positions and position changes
- Took profit on my long Eur/Usd position, reversed.
- Sold Gbp/Usd.
- Took profit on my long Aud/Usd position, reversed.
- Sold Gbp/Jpy.
- Took profit on my long GLL ETF (short gold).
- Took profit on my long LOIL ETF (Long Brent Oil).
- Went long SOIL ETF (Short Brent Oil).
- Long Bear ETFS on European Equity indexes
- Long Usd/Zar
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
However, I feel now is the time to reverse these positions - again.
Why? Well, to me the weaker Usd was a temporary retrieve in any case. The Usd is coming back soon due to a leveling of positions and the markets overpricing of QE is US vs recovery in Europe. Hence , I believe we will see a relative shift in long term rates favouring the Usd.
I am going long the Usd.
* The China syndrome - soon in Australia?
Australia is to suffer on the back of continued Chinese tightening as well as continued weakening Chinese assetmarkets. According to research, Chinese GDP growth is 100% due to the domestic industry of making fake brands. At least that makes me quite worried. Top it off with a very centralised structure, high leverage, insane capital allocation and you have the recipe for a real bubble burst with a bang. On the positive side; Basel 3 will likely mean an increased allocation from banks into reserve currencies such as the Aud. Short term, however, Im a seller of Aud.
* Equities still in a range - but its about to move lower within it.
Equities will still be looking good from a capital allocation model point of view, but short term I believe the market has gotten ahead of itself. Europe is not out of the woods - not by far.
I am going short European Equity indexes.
* While Oil may very well be in short supply going forward, the Gulf issue is overplayed and so is the demand for now. Im going short Brent Oil.
* The Wheat panic rocket is falling back to Earth - ish. Beware of setbacks.
However, with the recent move and the Russian wheat export stop and bad harvests already discounted by the market and a very, very swift move higher. I am at least looking for a correction lower before we get a top out test of the former high. Caution warranted though. Proper strict riskmanagement should be applied, as always.
* SouthAfrica - the Worldcup is over and the shine has faded. Whats left? A corrupt government, trying to silence the press in order to make room for murky deals and yet more corruption. This country was meant to set an example for the rest of Africa, leading openness,transparency, education, social responsibility and growth. Now its heading the other way. Mandelas legacy is fading fast. On top of it, neither the World Cup, nor the Olympic games are rarely an economic success for the hosting country, rather the opposite. I doubt it will be different for South Africa.
I am buying Usd/Zar.
* Positions and position changes
- Took profit on my long Eur/Usd position, reversed.
- Sold Gbp/Usd.
- Took profit on my long Aud/Usd position, reversed.
- Sold Gbp/Jpy.
- Took profit on my long GLL ETF (short gold).
- Took profit on my long LOIL ETF (Long Brent Oil).
- Went long SOIL ETF (Short Brent Oil).
- Long Bear ETFS on European Equity indexes
- Long Usd/Zar
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
10 June 2010
Change of plans, short term, things seems to be looking up.
* Spanish bond auction went well, positive numbers overnight from Japan, Australia and China
This means increased global rebalancing potential as European countries are getting increased possibilities for exports, as asian fiscal policies are turning more domestic. With asia and parts of the emerging world requiring tighter monetary policies. With Europe in delevraging mood due to sinking domestic conditions, this export potential will help.
The Eur will still have to weaken substantially, even below parity, to test all time lows. However, now does not seem to the time for it. Also, the Eur/Usd move lower has to take place during semicontrolled conditions in order to avoid European banks and general asset markets falling.
With the Eur moneymarket curve flattening, Portugal and Spain successfully issuing 3 year bonds. Should the ECB extend its liquidity terms today, I expect OIS spreads to narrow further, dragging high yield and assetmarkets higher. BOE will remain soft.
Equity markets remain at a low value compared to expected profits for 2010. A short term Equity move higher would therefore be in line with a positive ECB outcome.
*Positions and positions changes; Change of plans
My change of heart from yesterday is based on markettiming issues as well as the comments above. Main scenario remains, however, I choose to participate in this shortterm development/correction.
- Took profit on my short Eur/Usd, position reversed.
- Took profit on my short Gbp/Usd
- Took profit on my short Aud/Usd, position reversed.
- Took S/L on my long Usd/Jpy
- Took profit on my long equity index put options
- Took profit on my long bank put options.
- Long GLL ETF (short Gold)
- Long LOIL ETF (Long Brent Oil)
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
This means increased global rebalancing potential as European countries are getting increased possibilities for exports, as asian fiscal policies are turning more domestic. With asia and parts of the emerging world requiring tighter monetary policies. With Europe in delevraging mood due to sinking domestic conditions, this export potential will help.
The Eur will still have to weaken substantially, even below parity, to test all time lows. However, now does not seem to the time for it. Also, the Eur/Usd move lower has to take place during semicontrolled conditions in order to avoid European banks and general asset markets falling.
With the Eur moneymarket curve flattening, Portugal and Spain successfully issuing 3 year bonds. Should the ECB extend its liquidity terms today, I expect OIS spreads to narrow further, dragging high yield and assetmarkets higher. BOE will remain soft.
Equity markets remain at a low value compared to expected profits for 2010. A short term Equity move higher would therefore be in line with a positive ECB outcome.
*Positions and positions changes; Change of plans
My change of heart from yesterday is based on markettiming issues as well as the comments above. Main scenario remains, however, I choose to participate in this shortterm development/correction.
- Took profit on my short Eur/Usd, position reversed.
- Took profit on my short Gbp/Usd
- Took profit on my short Aud/Usd, position reversed.
- Took S/L on my long Usd/Jpy
- Took profit on my long equity index put options
- Took profit on my long bank put options.
- Long GLL ETF (short Gold)
- Long LOIL ETF (Long Brent Oil)
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
09 June 2010
BP vols skyrocketing to 130%, sell Gold
* A lot of talk whether BP will make it or not, strategic chapter 11 in the US, etc. Comparisons with Lehman seems misplaced to me. However, the political pressure is immense.
This will have repercussions on the assetmarkets. The risk is that all offshore drilling will be banned. Norway is alledgedly contemplating such a ban as well. This would drive Oil north, of course. On the other hand, Gold seems like a classic crowded trade, and the current violent moves might push margin accounts to consolidate, selling gold in the process.
* Positions
- Short Aud/Usd
- Short Eur/Usd
- Short Gbp/Usd
- Long Usd/Jpy
- Short European Equityindexes, European banks via options
- Long GLL ETF (short Gold)
- Long LOIL ETF (Long Oil)
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
This will have repercussions on the assetmarkets. The risk is that all offshore drilling will be banned. Norway is alledgedly contemplating such a ban as well. This would drive Oil north, of course. On the other hand, Gold seems like a classic crowded trade, and the current violent moves might push margin accounts to consolidate, selling gold in the process.
* Positions
- Short Aud/Usd
- Short Eur/Usd
- Short Gbp/Usd
- Long Usd/Jpy
- Short European Equityindexes, European banks via options
- Long GLL ETF (short Gold)
- Long LOIL ETF (Long Oil)
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
20 May 2010
China, already on the ropes, getting hit by European slump, dragging Aud with it.
* Equity markets continue dropping
Eur bid! Looks like a classic shortsqueeze although intervention rumours are floating around. Personally, I dont believe the latter. It would probably be one of the most silly things ECB could do. It would give a green light for a Eur collapse. Rather I believe Eur shorts are covering as risklimits are cut and losses forces consolidation. I prefer to view Eur/Usd at 1.25 as a sell.
* A vicious circle
Euro area deflation pushing down European demand, as Chinas main export market, this pulls down Chinese exports. As China is the biggest exportdestination for Australia, this drags down Australias exports. AUD is/was a crowded long trade for all the wrong reasons. Hence, we are now watching both a washout as well as a fundamental shift in the approach to the AUD.
It will have further to fall.
Further, with European banks under strain, this will reduce liquidity, same thing in China due to tightening measures and falling asset classes. Liquidity driven trades will now suffer.
Carry traders get carried out.
*With leverage further increased, we are now in a situation with very high stakes. Any missstep by politicians or centralbankers will be magnified due to leverage. Remember, there is no riskmanager or riskmanagement in this equation. No stoplosses. May the force be with them.
It seems it would be time for a shortsqueeze, but,,,,,?
* New trades and positionchanges
- Took profit on my long GLD
- Took profit on my long VXX ETF
- Took profit on my long QID ETF
- Stopped out my short Eur/Usd and Gbp/Usd spotpositions
- Sold Aud/Usd
- Bought Equity puts on equity indices and banks
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
Eur bid! Looks like a classic shortsqueeze although intervention rumours are floating around. Personally, I dont believe the latter. It would probably be one of the most silly things ECB could do. It would give a green light for a Eur collapse. Rather I believe Eur shorts are covering as risklimits are cut and losses forces consolidation. I prefer to view Eur/Usd at 1.25 as a sell.
* A vicious circle
Euro area deflation pushing down European demand, as Chinas main export market, this pulls down Chinese exports. As China is the biggest exportdestination for Australia, this drags down Australias exports. AUD is/was a crowded long trade for all the wrong reasons. Hence, we are now watching both a washout as well as a fundamental shift in the approach to the AUD.
It will have further to fall.
Further, with European banks under strain, this will reduce liquidity, same thing in China due to tightening measures and falling asset classes. Liquidity driven trades will now suffer.
Carry traders get carried out.
*With leverage further increased, we are now in a situation with very high stakes. Any missstep by politicians or centralbankers will be magnified due to leverage. Remember, there is no riskmanager or riskmanagement in this equation. No stoplosses. May the force be with them.
It seems it would be time for a shortsqueeze, but,,,,,?
* New trades and positionchanges
- Took profit on my long GLD
- Took profit on my long VXX ETF
- Took profit on my long QID ETF
- Stopped out my short Eur/Usd and Gbp/Usd spotpositions
- Sold Aud/Usd
- Bought Equity puts on equity indices and banks
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
18 May 2010
Talk of German shortban - there goes the upside correction, down again,
* When will they ever learn?
German authorities are alledgedly looking to apply a short ban on government debt, and major financials; banks and insurers. An act of desperation.
Thought European authorities learnt something during the latest fire emergency in 2008/2009.
Apparently not. Read my lips; banning shortselling does NOT stop assetmarkets from caving in.
Repeat and write down 10 times on the blackboard please.
This is actually becoming quite silly. If Germany, Europes hope, is coming up with these kind of silly ideas, who knows whats next. This does not bode well. All bets are off re my correction expectations. The Eur/Usd blip higher to the high 1.24;s most likely WAS the Eur/Usd correction. This could also drag the equity markets down with it.
Whats next, intervention?
I tell ya, they've got it coming,,,,, This is not looking good at all. Actually, Europe is following the kamikaze actionplan to the letter. This will all end in tears. Authorities have no plan B. This is it. This is a onewaytrip downnnnnnn. But hey, add another package, it will probably help,,,,,, right.
Markets are coming to the conclusion that current plan is not working and that the people in charge have no clue what they have done so far.
* Humans have a hard time managing huge leverage.
Now , the leverage levels might have been managable earlier on, but now we are quickly moving to very extreme levels. To think that politicians and centralbankers will be able to manage from here I do not believe is realistic, unfortunately.
*Equity analysts need to think twice.
Corporate earnings and data have come in strong, balance sheets look quite good. So far so good.
However, basic economic theory will tell you that this is merely the mirror image of the monetary stimulus that was created by governments and centralbanks.
If a government runs a deficit other agents will do well.
If you inject the corresponding deficit amount into the economy it will surely help.
However, as tight fiscal policies are introduced and stimulus is withdrawn, the economy will slow and corporate results will get hit.
* "Noone" expects the equity lows from 2009 to be challenged again.
However, if European authorities do not think twice and shift their policies to more common sense ones, I believe we will.
* New positions
- Ive bought puts on Eur/Usd, Gbp/Usd, Eur/Jpy and Gbp/Jpy on the back of this.
- Ive bought VXX ETF;s
- Ive bought QID ETF;s
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
German authorities are alledgedly looking to apply a short ban on government debt, and major financials; banks and insurers. An act of desperation.
Thought European authorities learnt something during the latest fire emergency in 2008/2009.
Apparently not. Read my lips; banning shortselling does NOT stop assetmarkets from caving in.
Repeat and write down 10 times on the blackboard please.
This is actually becoming quite silly. If Germany, Europes hope, is coming up with these kind of silly ideas, who knows whats next. This does not bode well. All bets are off re my correction expectations. The Eur/Usd blip higher to the high 1.24;s most likely WAS the Eur/Usd correction. This could also drag the equity markets down with it.
Whats next, intervention?
I tell ya, they've got it coming,,,,, This is not looking good at all. Actually, Europe is following the kamikaze actionplan to the letter. This will all end in tears. Authorities have no plan B. This is it. This is a onewaytrip downnnnnnn. But hey, add another package, it will probably help,,,,,, right.
Markets are coming to the conclusion that current plan is not working and that the people in charge have no clue what they have done so far.
* Humans have a hard time managing huge leverage.
Now , the leverage levels might have been managable earlier on, but now we are quickly moving to very extreme levels. To think that politicians and centralbankers will be able to manage from here I do not believe is realistic, unfortunately.
*Equity analysts need to think twice.
Corporate earnings and data have come in strong, balance sheets look quite good. So far so good.
However, basic economic theory will tell you that this is merely the mirror image of the monetary stimulus that was created by governments and centralbanks.
If a government runs a deficit other agents will do well.
If you inject the corresponding deficit amount into the economy it will surely help.
However, as tight fiscal policies are introduced and stimulus is withdrawn, the economy will slow and corporate results will get hit.
* "Noone" expects the equity lows from 2009 to be challenged again.
However, if European authorities do not think twice and shift their policies to more common sense ones, I believe we will.
* New positions
- Ive bought puts on Eur/Usd, Gbp/Usd, Eur/Jpy and Gbp/Jpy on the back of this.
- Ive bought VXX ETF;s
- Ive bought QID ETF;s
As usual, good luck
The comments and posts published in this blog ARE NOT trading recommendations. They can NEVER be considered as trading calls or advices. If you decide to use the information offered here for your real trading it is at your own risk.Trading on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading and seek advice from an independent financial advisor if you have any doubts.Errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website is provided as general market commentary and does not constitute investment advice."www.todaysmacrotrading.blogspot.com" will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.© 2008 "www.todaysmacrotrading.blogspot.com:The traders blog" All Rights Reserved.
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