Relying little on the regenerative powers of the American economy if left to its own devices and instead on US$ debasement and artificially low interest rates to try to boost economic activity, one thing has usually been sure from the actions of the Fed, asset prices rise in nominal terms. I say nominal because in gold terms, the S&P 500 yesterday fell 1.4%. The euro heavy DXY is falling to a 7 week low and the US$ is falling to the lowest level since late Oct vs the AUD, CAD, Won and Taiwan and Singapore $’s to name a few and the lowest since Sept against the Mexican peso. Those that own assets (outside of a home) can protect themselves vs a decline in the value of the US$ while those that don’t get hurt by a rise in inflation. No one seems to blame the Fed however for an exaggeration in income inequality. With this said, the RSI in the front month S&P futures is now at the highest since Feb which at the time was the top tick for a few months as markets consolidated. In Europe, the goings on there still can’t dent the confidence of the Germans where consumer sentiment rose to the best level since April. French consumer confidence rose 1 pt off its lowest since Feb ’09. Italian consumer confidence held at the lowest since at least ’96 (record low for this survey). Italy sold two debt issues and the maximum amount they wanted to sell and yields are lower in response. Spanish yields are down too with the 2 yr in particular at the lowest since Nov ’10. Also, the cost of swapping euros for US$’s is falling to the cheapest since Aug. Yields however are spiking in Portugal as they will likely be next after Greece. In Asia, South Korea’s economy had the slowest q/o/q gain since Q4 ’09 at .4%.
Weak $, many say risk on, I say self defense
January 26, 2012 8:23am by
This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment. The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client. References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. The Compound Media, Inc., an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers Please see disclosures here: https://ritholtzwealth.com/blog-disclosures/
Posted Under
UncategorizedNext Post
A quick look at ETFs