But that it’s a good investment idea…well that is another matter entirely. And politicians who are blaming euro bond weakness on short sellers are looking for a villain that is not them. It’s a confusion of cause and effect, like blaming the buzzards for the death of the corpse. It does buy them time though, in the blame game.
May 19th, 2010 | Dan Denning | 9 comments | ContinuedAll Posts Tagged With: "sovereign debt crisis"
Algoholics Anonymous
Your editor’s phone began buzzing this morning shortly before 6am with texts asking us to turn on CNBC. There we saw what you saw: the Dow Jones had its largest-ever intra-day decline since 1987. The index fell nearly 1,000 points and almost ten percent as about $1 trillion in market value briefly got wiped out.
May 7th, 2010 | Dan Denning | 38 comments | Continued
Not the End of the Greek Sovereign Debt Crisis
One key is whether the faux resolution of the Greek crisis will lead to rising sovereign bond yields. This might seem counterintuitive. If Greece is less risky and volatile, shouldn’t bond yields fall? Maybe not. If investors think the sovereign debt crisis is over, they may shift out of supposedly risk-averse assets like bonds and into equities. This would argue – in the very short term – for higher highs on the indices.
April 13th, 2010 | Dan Denning | 0 comments | Continued
If People Feel Good About the Economy then the Economy Must Be Good Itself
Stock markets are fixing to make their highest highs since September of 2008. The Dow nearly closed at a post-Lehman high of 11,000 overnight in New York trading. And here in Australia, the ASX/200 looks to break out of a long channel of indecisiveness and close above 5,000.
Surely those numbers indicate that people feel good about the economy.
April 6th, 2010 | Dan Denning | 3 comments | Continued
Trade of the Decade: Sell Stocks and Buy Gold
So about 10 years ago, when I first started working with Bill, he came up with this idea for a Trade of the Decade. It was really just a literary device. But it ended up being a brilliant investment call.
March 30th, 2010 | Eric J. Fry | 1 comment | Continued
Martin Armstrong Suggests the Sovereign Debt Crisis in Europe Will Lead to Rising Interest Rates
But according to America’s self-described “#1 political prisoner” Martin Armstrong, the Western world’s fiscal malfeasance has left it trapped between two equally undesirable but unavoidable outcomes: default of civil unrest. We are at the pointy end of the crisis (Phase two as he describes it). Yet very few people seem to appreciate what’s actually happening.
March 22nd, 2010 | Dan Denning | 9 comments | Continued
Inflation is a Reality in China
Bloomberg reports that consumer prices rose by 2.7% in February. That’s the fastest monthly growth rate in 16 months. And it eclipses the annual yield on savings deposits of 2.25%. Savers aren’t beating inflation. And if they can’t do that, they may as well spend the money. That could ignite a rising price cycle in China that monetary authorities want to avoid.
March 12th, 2010 | Dan Denning | 7 comments | Continued
ABARE Explains How Much Australia Can Make from Selling Silver, Iron Ore and Coal
The main conclusion was that Australia would see rising export earnings on higher volumes but moderating commodity prices. In other words, the China boom will drive export volumes for the next five years. But you won’t see any more mammoth increases in commodity prices.
March 3rd, 2010 | Dan Denning | 2 comments | Continued
Have Things Turned the Corner for Funding Aussie Mortgage Growth?
It’s probably too early to say. The Australian Office of Financial Management continues to support the market for non-bank lenders. Non-bank lenders have to fund new loans via securtisation. Without the AOFM’s backing, you have to wonder how many first home buyers would have been able to find housing finance.
December 21st, 2009 | Dan Denning | 25 comments | Continued
A Sovereign Debt Crisis Bullish for U.S. Dollar and Bearish for Gold
In fact you don’t have to imagine it all. Or be insane. Bloomberg reports that, “Dollar Rises as Stocks, Commodities Fall in Flight From Risk.”
February gold futures fell below $1,100, down 2.5%. The Dow Jones Industrials fell 1.27%. The S&P 500 shed just over 1%. And the U.S. dollar rallied against all 16 currencies in the dollar index. What gives?
December 18th, 2009 | Dan Denning | 0 comments | Continued
The Trouble With a Sovereign Debt Crisis
The trouble with a sovereign debt crisis is that you just never know what the tipping point is going to be. Things can be travelling along nicely with apparent stability and suddenly you find yourself in the middle of a crisis. For the last month we’ve been warning about a sovereign debt crisis in the Western Welfare states.
November 27th, 2009 | Dan Denning | 17 comments | Continued
U.S. Government Must Roll Over $3.4 Trillion in Debt Over Next Four Years
And if America can’t find anyone willing to finance its deficits, what then? Well, the luxury of issuing debts in the currency you also print is that you can print money to pay for them. Technically, you can never become insolvent when you enjoy this privilege. The Fed, for example, can create new money to buy debt issued by the Treasury, funding deficits ad infinitum.
November 3rd, 2009 | Dan Denning | 5 comments | Continued
