Is it Just Me...?

Generali

....or are the markets coming over all '2008' on us again?

South African Rand is down 20%, Aussie dollar is down 10%, Nikkei down almost 20%, FTSE is off 10%.

Now I realize that a lot of this is from multi-year highs but my spidey sense is twitching.

michaels

Generali wrote: »

....or are the markets coming over all '2008' on us again?

South African Rand is down 20%, Aussie dollar is down 10%, Nikkei down almost 20%, FTSE is off 10%.

Now I realize that a lot of this is from multi-year highs but my spidey sense is twitching.

Don't forget what is going on in the long bond market. Question is is it a response to a pick up in the US resulting in an end to QE and thus a pricking of an asset bubble or might there be "trouble ahead"?

purch

When markets switch direction on little or no news, and even fewer actual facts you need to be wary

There appears to be some confuzzilation out there. "Safe" assets seem to be losing their appeal, but the conviction to move into riskier areas isn't as strong as it might it might seem to have appeared initially

chewmylegoff

Gen, are you suggesting that we should all buy silver?

purch

He normally uses a different username for that :eek:

MacMickster

I think that the stock markets in particular got quite a bit ahead of fairly weak signs of a recovery in the economy. Either investors had read the economic indicators correctly and the economy would soon catch up, or else the markets would soon drop back again.

The FTSE remains well ahead of where it was 6 months ago, despite GDP effectively continuing to flatline over the same period.

At the moment investors are eager not to miss out on any sudden upturn, so respond disproportionately to any sight of green shoots.

The same has happened in Japan where the new government strategy, which promised so much, is not yet delivering what everyone had hoped.

chucknorris

Generali wrote: »

....or are the markets coming over all '2008' on us again?

South African Rand is down 20%, Aussie dollar is down 10%, Nikkei down almost 20%, FTSE is off 10%.

Now I realize that a lot of this is from multi-year highs but my spidey sense is twitching.

Sorry it's my fault I moved 10k from cash to shares yesterday morning, and shortly afterwards the ftse fell. I am doing the same again this morning so expect another large fall sometime around noon (just after I invest).

Generali

chewmylegoff wrote: »

Gen, are you suggesting that we should all buy silver?

Not at all but it mightn't be a bad time to take you profits on bank shares.

If I had to buy a single share today it'd be Rio or BHP. The end of the commodities boom means that Capex spending (investment in new mines) will end and those boys will be throwing off vast amounts of cash in a couple of years. You'll need a strong stomach because the price will be all over the place I reckon but I've got a strong conviction.

I'm not a buyer at the moment but will be at Xmas.

Generali

MacMickster wrote: »

I think that the stock markets in particular got quite a bit ahead of fairly weak signs of a recovery in the economy. Either investors had read the economic indicators correctly and the economy would soon catch up, or else the markets would soon drop back again.

The FTSE remains well ahead of where it was 6 months ago, despite GDP effectively continuing to flatline over the same period.

At the moment investors are eager not to miss out on any sudden upturn, so respond disproportionately to any sight of green shoots.

The same has happened in Japan where the new government strategy, which promised so much, is not yet delivering what everyone had hoped.

TBH, I think the fears are around managing the recovery. We're seeing increasing strength in the UK and US recoveries. At some point interest rates will rise and/or QE will be withdrawn. At the very least, no more QE will happen.

I don't think that's a major problem but markets clearly aren't happy about something.

Generali

michaels wrote: »

Don't forget what is going on in the long bond market. Question is is it a response to a pick up in the US resulting in an end to QE and thus a pricking of an asset bubble or might there be "trouble ahead"?

Well indeed.

I've maintained right the way through the last 4 years that with these policies that have been pursued, managing the recovery is going to be the tough bit and nothing I've seen has made me change my mind.

The amount of money that has been introduced into the banking system is phenomenal and unprecedented. We have no experience of dealing with this so are largely 'flying blind'. If that money comes out of the banking system into markets for goods and services then inflation will soar. Take all the money back out and the banks are insolvent again (especially the European ones).

Who'd be a Central Banker?

Generali

purch wrote: »

When markets switch direction on little or no news, and even fewer actual facts you need to be wary

There appears to be some confuzzilation out there. "Safe" assets seem to be losing their appeal, but the conviction to move into riskier areas isn't as strong as it might it might seem to have appeared initially

Yup. I don't know what's going on but it doesn't look good.

There's something in the air.