Posts Tagged ‘CSU’

Notes From Underground: More Questions Then Answers … Tapering Foreshocks

November 12, 2013

The fools are alive with the sound of tapering. There’s a constant drone of the CNBC crowd that the fear of Fed tapering has sent emerging markets to nine straight days of losses. While the emerging markets have been responding negatively to tapering, the developed markets have been making new highs. So it seems that the FED removing liquidity will be far more detrimental to the emerging markets than to the developed world’s equity markets. A quick snapshot of the tales of two markets reveals the divergence taking place in the global financial markets. The Mexican ETF EWW is down 12% on the year while the S&Ps are up 27%. Yet, the Mexican economy is heavy dependent on the U.S. market for a large percentage of its exports. If the U.S. consumer is healthy enough to help the U.S. equities to a solid gain on corporate profits, how can the Mexican financial markets be so negatively divergent? It is not only the issue of economic growth but also the health of the overall financial system.

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Notes From Underground: 500 Days of Summers … NOT

September 15, 2013

As the markets were heading into the close on Friday afternoon, I noticed that silver and gold were rallying and the newswire failed to provide any headline for the a substantial price rise. (There was no Syria news or any other type of geo-political event.) The weekend news also failed to support the rally at least until a few hours ago when the Washington Post ran a headline announcing that Larry Summers had withdrawn his name for consideration for Chairman of the Fed. Many pundits have been maintaining that Summers would be quick to end the entire QE program and thus would have a negative impact on all asset prices. Nonsense in the first degree, but as a trader, the first rule is to respect prices. The removal of Summers has led to the U.S. dollar selling in early Asian trading as the anticipation is now the Fed will be under a Chairman more in step with the Bernanke method of central bank theory.

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