In view of Federal Reserve Chairman, Ben Bernanke, yesterday: it is time to reassess one’s investment strategy. The former Princeton professor didn’t give us QE3, he gave us QE3 with a turbocharger, on steroids, with an extra dose of adrenaline. He could spend another $1 trillion before all is said and done. If ever an […]
The big surprise today was not that the Federal Reserve launched QE3, but the extent of it. For a start, they moved the “low interest rate” target out to mid-2015. They left the commitment to bond-buying open-ended. The first-year commitment came in at $480 billion, in-line with previous efforts. Reading the statement from the Open […]
Long-term readers of this letter are well aware of my pleadings with them a couple of years ago to buy Apple (AAPL) stock at $250 with a target of $1,000. Certainly, the 200 readers who work for Apple noticed. That was back when the main concern about the company was that Steve Jobs would die […]
My Fed Call. Survey traders and investors today, and you will find that 99% believe further quantitative easing via QE3 will be announced on Thursday. Poll vote Fed governors and you get a more realistic 50% probability. I think it is much less than that – and therein lies the trade. I think that markets […]
Global Trading Dispatch’s Trade Alert Service posted a new all-time high yesterday, clocking a 63.2% return since inception. The 2012 YTD return is now at 23.05%. That takes the average annualized return up to 33.3%, ranking it among the top performing hedge funds in the world. Those happy subscribers who bought my service on May […]
Look at the charts for the barbarous relic below and you can only come to one possible conclusion. If the Federal Reserve disappoints on Thursday, just a little bit, even by a smidgeon, and does not deliver QE3 and gold sells off big, you should jump in and by the stuff like crazy. All of […]
NOTE TO READERS: There is a short letter today because I spent the entire weekend writing Trade Alerts, which you will receive right at the Monday morning opening. Last Friday, China announced a $150 billion reflationary public works budget designed to arrest the current free fall in the country’s GDP growth rate. The move came […]
Sell Short the Currency Shares Australian Dollar Trust October, 2012 (FXA) $105-$108 call spread at $0.35 or best Opening Trade 9-4-2012 – 2:00 PM EST expiration date: October 19, 2012 Portfolio weighting: 10% = 45 contracts on a net delta adjusted basis This is a bet that the Currency Shares Australian Dollar Trust October, 2012 […]
When communications between intelligence agencies suddenly spike, as has recently been the case, I sit up and take note. Hey, you don’t think I talk to all of those generals because I like their snappy uniforms, do you? The word is that the despotic, authoritarian regime in Syria is on the verge of collapse, and […]
Cheers went up from the real estate industry this morning when the Standard & Poor’s/Case Shiller data was released. It showed the first year-on-year increases in prices since 2006. Calls went out from real estate agents around the country announcing that the bottom was in and that you better buy now before prices shoot up. […]
I was researching comparative Asian wage data the other day and was astounded with what I found. Textile workers earn $2.99 an hour in India (PIN), $1.84 in China (FXI), and $0.49 in Vietnam (VNM). This is an 18-fold increase in labor costs from $0.10 an-hour since Chinese industrialization launched in 1978. This compares to […]
I certainly hope you took my advice to load your portfolio with corn and gold and to dump your equities five years ago. What? You didn’t? Then you have almost certainly suffered on the performance front. According to data compiled by my former employer, the Financial Times, corn was the top performing asset class since […]
During my recent meeting with the senior portfolio managers of the big Swiss banks, I kept hearing the same word over and over: yield, yield, yield! The search for yield by end investors has become so overwhelming that it now trumps all other considerations. So I am starting a series of major pieces on the […]
It is a fact of life that markets get overstretched. Think of pulling on a rubber band too hard, or loading too many paddlers at one end of a canoe. Whatever the metaphor, the outcome is always unpleasant and sometimes disastrous. Take a look at the charts below and you can see how extended markets […]
Mr. Market sometimes speaks in mysterious tongues, and you really have to wonder what he is struggling to tell us by taking the Volatility Index (VIX) down to a subterranean $13 handle on Friday, a new five year low. A number of advisors have been recommending that investors load up on the (VIX) in recent […]
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