Wednesday, July 4, 2018

Recommendation to reduce equities position size.

"Concerning my negative views about equities I would like to add that an important technical signal has turned down badly: the Smart Money Flow Indicator (SMART Index), which is calculated according to a special formula.           
The broader point I want to make is that we can see an increasing number of signs and indicators that point to a major slowdown in the global economy and to disappointing corporate earnings. Therefore, I reiterate my previous recommendation that investors who are overweight equities should really reduce their heavy exposure. " 

Tuesday, June 12, 2018

China has FOUR times the population of USA and is a larger country


"I don't want to criticize the U.S., because in other countries it is not much better. But the one thing I want to say is the following: Americans have been growing up and they've been brainwashed that America is a superpower and they have been educated in the belief of the American exceptionalism. And I just want to say that lots of countries in this world have a different perspective of the world. In particular, if you look at China, it has four times the population of America. Its industrial production is larger than in the U.S., their land mass is larger than the U.S., and they're growing at a much faster pace. They have, in my opinion, no territorial ambitions, but they don't want to be controlled by the U.S. that has, in Asia, countless military and naval bases.

They (China) look at the world from their perspective, and the U.S. would do well to consider other leaders' perspectives, including Xi Jinping and Mr. Kim Jong-un, and Mr. Putin, of course. But if you only look at the world from your perspective, undoubtedly some trouble will arise. And what most Americans don't see, they have kind of a tunnel vision where the tunnel starts in America and looks at the whole world, whereas other countries, they have another view of the world than the U.S.

And I think it's very important, both economically and politically to consider the point of view of other countries that, by the way, have become very powerful."

Thursday, June 7, 2018

US rate hikes could cause a recession

"Well, a lot of industrial commodities have been rallying because of commodities-related circumstances, like aluminum rallies because of the trade embargo against Russia, and so forth. 

But if I look at industrial commodities, I rather have the feeling that they will come down. Why? I think the increase in interest rates in the U.S. on the 10-year treasury note from 1.38 percent in the summer of 2016 to the current level of over three percent, in other words, we more than doubled in the yield in the bond market. 

And for the two-year treasury, we have been going up between 10 and 20 times depending how you measure it.

I think these interest rate increases will slow down the U.S. economy, and probably bring about a recession."

Wednesday, May 30, 2018

US Dollar could rebound in the near term

"I think there has been, just recently, a huge short position in the dollar. In other words, speculators, 15 months ago, they were heavily long in the dollar, and now they are very heavily short dollar. I think the dollar may rebound and as a result, precious metals may not move up right away. I think, eventually, they'll move up, but for the next, say, one or two months, I don't see how precious metals would rally significantly."

Tuesday, March 27, 2018

Long term optimistic on India

India from a longer term point of view is still a good proposition but India is not exactly a problem-free country. There is leverage in the system and there has been fraud and there are still some unsettled political events that may happen. 

I would say given that the market has actually rallied very strongly over the last few years and that we have reached a high at 36400 on January 29th , we could easily decline by around 20% from the highs that would take us below 30000. Long term, I am optimistic but we have to realize that if one asset class goes down, fund managers will also sell another one even though the fundamentals may be favorable but they just get out and build up their liquidity because on institutional side, the funds are holding very little liquidity. So, they may build up liquidity and that can then bring about selling pressure everywhere. 

via economictimes

Tuesday, January 23, 2018

Why it may make sense to own some Cash now

"Cash is the asset class that is most neglected at the present time. Everybody wants to hold real estate, stocks, crypto currencies. I would say why dont you hold some cash."

via GoldSeek radio

Thursday, January 18, 2018

Wednesday, January 3, 2018

Possible to see volatility to the downside in 2018

"Asset markets enjoyed a superb 2017. It is doubtful that in 2018 all asset markets will appreciate in concert as they did in 2017. Rather, I expect that some diverging trends among asset prices will emerge and that the expected change in leadership will bring about some painful downside volatility."