Posts from — June 2007
Chinese meat prices up 27 percent?
In keeping with the Chinese state’s ancient tradition of publishing statistics that do not pass the laugh test, Chinese authorities insist that food prices jumped 8.3 percent from a year earlier, because meat prices jumped 27 percent.
Sudden burps in Chinese statistical trends are commonplace; the Chinese state usually keeps a lid on all problems until they become impossible to manage. China-skeptics have long suspected much higher inflation within China than the Chinese government has been willing to admit (another reason bank deposits, which under that scenario would earn negative real interest, are fleeing for any other asset class, i.e., Chinese equities).
This China-bear expects that this inflation figure is only the beginning.
June 13, 2007 No Comments
Treasury Yields Rise to Highest in Five Years
Yields on benchmark 10-year Treasuries rose to the highest in five years as signs of accelerating global growth raised concern central banks will increase borrowing costs. Bond prices slumped after reports in China and Japan showed consumer and producer prices rising, while the head of the U.K. central bank signaled borrowing costs may need to rise to keep inflation from accelerating.
June 12, 2007 No Comments
US investor confidence still well above historical mean
The Rasmussen Investor Confidence Index, a survey of perceptions and expectations of investors who own at least $5,000 of stocks, bonds and/or mutual funds, registered an above-average 132.6 in spite of sharp equities losses over the past week.
The Index has ranged from a high of 150.9 on Jan. 7, 2004 to a low of 91.1 on March 13, 2003. The lowest point in the second quarter of 2007 was on May 24, when the index registered 122.5.
June 8, 2007 No Comments
GOP legislator applies doctrine of pre-emption, clocks Democrat in face
Hilarious. I know this has nothing to do with international investing whatsoever, but you can’t not pass this up. Humor is essential after weeks where the markets’ performance is as craptastic as this past one has been.
June 8, 2007 No Comments
As worldwide equities retreat, Shanghai rolls on
As worldwide equities markets rolled their eyes at Shanghai’s schizophrenia this week, Shanghai has returned the favor. Although the bears have stampeded Western and South American equities this week, the Shanghai composite (the SSE) has stubbornly clawed back most of its heavy losses after the bloodbath from the first 36 hours of the week. Here is the SSE for the last five days, courtesy of finance.yahoo.com:
Even the Hang Seng (the HK index) is behaving very differently from the SSE.
The SSE has shown low correlation with the rest of the world’s capital flows. As long as Chinese “investors” continue plowing their life savings into chasing the SSE’s superheated supply of shares, it’s anybody’s guess as to how long this market will continue to rise. But when the bubble pops, it’s going to be pretty ugly.
June 8, 2007 No Comments
Asia Stock Investing for the Long Term – Chart of the Day
Only a super long term investor would have gotten back to break even if they had purchased the index in Dec of 89.
From John Mauldin the source of the chart:
Returns over this time period have annualized to a mere 1.98%, with a 20.20% standard deviation. Let me put it in concrete terms: there are three periods in the last ten years when a million dollars invested, at the wrong time, would have been HALVED by a down market. That’s some serious volatility.
June 5, 2007 No Comments
Chart of the Day – S&P in Gold
June 1, 2007 No Comments
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