So what will the next financial crisis look like and more importantly what opportunities could it pose for traders and long-term investors? One decade on from Lehman’s bankruptcy (September 17, 2008) and the stock market crash of 2008 which triggered a credit squeeze then the Great Recession. Moreover, the greatest monetary experiment in the history of finance which entailed the central banks pumping the financial market with...
Read More
Seeing with a mind’s eye into the future a stock market sell-off could be weeks, or a few months away. A sharp stock market sell-off (crash) could dominate future media headlines as September drifts into October and then early November 6 when US midterm elections is scheduled to take place. If I am bang on the money then this imminent stock market sell-off will make the previous February stock-market sell-off which I correctly...
Read More
US stocks outperforming non-US stocks is a trend that could have legs going forward World stock markets have been trailing US stocks. The divergence in US stocks outperforming non-US stock has reached a level not seen since the last recession, according to recent data from B of AML Research. The S&P continues its historic bust higher bucking one resistance level after another (in what is now an unprecedented bull market),...
Read More
Europe’s wildcard, Italy is likely to remain in focus Italian 10yr Government (sovereign) bonds yields (at the time of writing this piece) have spiked to 3.1% near their 52 week high. Europe’s wildcard, Italy is illustrated in the Italian 10yr sovereign bond chart (Source: Marketwatch) The Italian 10yr bond chart is saying is that private investors are ditching Italian government debt over concerns about Italy’s new...
Read More
The Genoa motorway Bridge collapse, a vital logistics hub linking the Genoa port, the Italian Riveria with southern coastal France, underscores the fact that Europe’s infrastructure is crumbling, neglected and starved of capital investment for too long. Europe’s infrastructure is crumbling France has more than 800 bridges which are at risk of collapsing, according to an audit commissioned by the French government. The...
Read More
Financial contagion is rearing its head again. Emerging market contagion is now eclipsing euro peripheral debts (which continues to be an ongoing problem). Emerging market financial contagion look like the most wobbly domino on the bubbly financial landscape As the Fed, (the world’s central bank by default) hikes rates and strengthens (weaponizes) the dollar it is emerging markets dotted along the New Silk-road that are in the...
Read More
Will the asset bubble find its pin? Everything is in a bubble. It is the most overvalued stock market in history by whichever matrix you wish to use. Bonds, particularly European bonds are in a bubble also. For example, European junk yields are now lower than that of US Treasuries. Is Euro junk debt less risky than US Treasuries? I asked in a piece entitled, “The Deflating Bubble of Everything”, dated November 20, 2017. But it is not...
Read More
Perhaps financial markets are on the central bank’s rate lift-off launch pad, if so buckle up. Stayed tuned to this weeks storm of news as July slips away and we enter August. The central bank’s rate lift-off could make next week’s mainstream headlines A melting pot of central bankers from the US, Japan, the UK, Brazil, and India all meet to set their respective monetary policy. Such as an eclectic mix of central...
Read More
Harry Markowitz’s perfect portfolio theory (also known as modern portfolio theory) is one of the most important economic theories dealing with finance and investment. Harry Markowitz’s perfect portfolio theory was published under the title “Portfolio Selection” in the Journal of Finance in 1952. Whatmore, six decades later Harry Markowitz’s perfect portfolio theory is still in vogue today among the...
Read More
It would be timely to zero in on Q2 2018 earnings as the peak weeks of the latest earnings season come into focus. I have joined some dots, bearing in mind that already 109 S&P 500 companies have issued their results, an interesting vision is emerging. So let’s zero in on Q2 2018 earnings by first getting an earnings insight with FactSet (setting the facts straight). Q2 2018 is a mixed back with some upbeat news to report....
Read More
Recent Comments