Tag Archives: Featured

Summary: Our bullish dollar outlook was based on divergence and we judge it to still be intact. The Dollar Index has been trading broadly sideways since March 2015, but never did more than a minimum retacement of its earlier rally. The Dollar index is at it highest level since March today. Our underlying constructive outlook for the US dollar remains intact.  It is broadly based on the divergence between the...

Summary: ECJ uphold principle of bailing in junior creditors before the use of public funds. Italian banks shares snap a three-day advance. The EBA/ECB stress test results at the end of next week are the next big event. The European Court of Justice upheld the principle of making creditors bear the burden for investment in banks that sour before government funds can be used. Italian banks are particularly...

Investec Switzerland. Givaudan SA, the world’s largest flavors and fragrance company, reported first-half profit that beat analyst estimates on increased demand for perfumes. © Ragsac19 | Dreamstime.com Earnings before interest, taxes, depreciation and amortization rose 13 percent to 638 million francs ($649 million), the Vernier, Switzerland-based company said in a statement on Monday. Analysts...

Investec Switzerland. Novartis AG said profit may fall this year as the Swiss drugmaker increases spending on the heart medicine Entresto and faces declining sales of its best-selling cancer treatment Gleevec. © Lucaderoma | Dreamstime.com Core operating income will either be about the same as 2015 or decline by a percentage in the low single digits at constant exchange rates, Novartis said Tuesday...

Via The Mises Institute, [An interview with Hans-Herman Hoppe in the Polish weekly Najwy?szy Czas!] What is your assessment of contemporary Western Europe, and in particular the EU? All major political parties in Western Europe, regardless of their different names and party programs, are nowadays committed to the same fundamental idea of democratic socialism. They use democratic elections to legitimize the taxing...

Asset Price Levitation One of the more preposterous deeds of modern central banking involves creating digital monetary credits from nothing and then using the faux money to purchase stocks.  If you’re unfamiliar with this erudite form of monetary policy this may sound rather fantastical.  But, in certain economies, this is now standard operating procedure. For example, in Japan this explicit intervention into the...

Summary: Article 7 would suspend the UK’s EU voting rights on grounds it is not negotiating in good faith by delaying the triggering of Article 50. The U.S. debated what “is” means, now investors are trying to figure out what May means. Although sterling has stabilized, interest rate differentials have not. Due to an unlikely string of events, the UK had sorted out its government more than two months...

INTRODUCTION  After last Friday’s failed coup attempt in Turkey, a measure of calm has returned to global markets.  We did not think Turkish developments have wide-reaching implications for EM assets, but we do remain very negative on Turkish assets in the wake of the coup and ongoing political uncertainty.POLITICAL OUTLOOK Democracy has (so far) been upheld as the coup attempt has failed.  That Erdogan was...

EM ended last week on a soft note, due in large part to the attempted coup in Turkey.  Weakness in the lira spilled over into wider EM weakness in thin Friday afternoon market conditions.  The situation in Turkey has calmed, and so EM may gain some limited traction this week.  However, that calm will likely be very fragile and so we retain a defensive posture with regards to EM. Turkey Central Bank of Turkey meets...

  Speculator’s Market LOS ANGELES – Stocks were up again… Whoa! Hold on just a cotton-picking minute. Honest investors are getting out of the stock market. There have been net withdrawals of $80 billion from U.S. equity funds so far this year. Who’s buying? This is a speculator’s market. And the No. 1 gambler is playing with an infinite amount of chips. We’re talking about central banks – who create money on demand....