My earlier doubts about the US economic outlook have softened some, but not much. I still see slowing in the US equity sector and while 10-year treasury yields continue to fall, I expect the long bond to outperform. For 2016, modest dollar appreciation appears likely against the Euro and commodity currencies. I’m long precious metals, the long bond, and utilities. Short US financials.
Ashraf, great points. The rapid deterioration in the world economy you describe poses a serious challenge to portfolio managers. In the US, there is ongoing deflation, a growth slowdown in manufacturing, and corporate profit recession. A rebound in equities is dubious and the risk of another downward move is substantial.
Until ongoing worries about the Yuan subside, macro data improves, and credit spreads narrow, I would imagine that asset allocation models should favor cash, fixed income, and currencies.
In addition to short-term trading of FX spot and crosses, how would you feel about allocating capital to the USD and Yen via the ETFs UUP and FXY?
Judging from shares bought at today's close, there's still the possibility of a "surprise" ...when institutional money flows better align with macroeconomics. Tonight's data posted at www.nextSignals.com/ (Most of the flows into safe havens and defensives.)
When I posted my comment, I was referring to the business cycle (as opposed to current stock market fluctuations). The econometric data is certainly mixed, but by and large the US appears to have reached a cyclical peak and is in a contraction.
Simply stated, I see a US recession, based upon contractions in industrial production and trade, reductions in full-time employment, and reductions in real personal income.
inflation slows as expected and 25-bp hike is a done deal. Good luck to Powell in delivering a hawkish press conference on Wednesday #forex (19 min ago)
احذر من المحتالين!!! لا ترسل أموالًا إلى أي شخص يقترب منك ينتحل شخصيتي. لن أقترب أبدًا من الناس لتقديم خدماتي لهم… https://t.co/AupkAa1UUD(57 min ago)
@AmerShahin6 @Twitter @TwitterSupport Thank you (1 hr ago)
#MexicanPeso has had an astounding run. Who's the next EM FX star? Indian rupee ? $INR (2 hr ago)
@AmerShahin6 @Twitter @TwitterSupport @AmerShahin6 this has been going for 3 years not for 1 mth. If you wish to h… https://t.co/VZjuHqAqjM(2 hr ago)
BEWARE of fake accounts on @twitter ! Read the ID carefully. If it is NOT @alaidi then it is FAKE even if it's the… https://t.co/bGMS506XEg(2 hr ago)
احذر من المحتالين!!! لا ترسل أموالًا إلى أي شخص يقترب منك ينتحل شخصيتي. لن أقترب أبدًا من الناس لتقديم خدماتي لهم… https://t.co/TOEzQIHvZ3(2 hr ago)
This Hinderburg-Adani battle could v well turn into the bloodiest lawsuits/scandals of the year..and it's only January (3 hr ago)
what a sensational goal from #Rodrygo (3 hr ago)
@jjlkwd Don't be a contratrian just for sake of it (16 hr ago)
ننتظركم الآن الساعة الخامسة مساءا بتوقيت مكة في غرفة إكس إم مع أشرف العايدي .أنقر على الرابط للمشاركة
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My earlier doubts about the US economic outlook have softened some, but not much. I still see slowing in the US equity sector and while 10-year treasury yields continue to fall, I expect the long bond to outperform. For 2016, modest dollar appreciation appears likely against the Euro and commodity currencies. I’m long precious metals, the long bond, and utilities. Short US financials.
Until ongoing worries about the Yuan subside, macro data improves, and credit spreads narrow, I would imagine that asset allocation models should favor cash, fixed income, and currencies.
In addition to short-term trading of FX spot and crosses, how would you feel about allocating capital to the USD and Yen via the ETFs UUP and FXY?
When I posted my comment, I was referring to the business cycle (as opposed to current stock market fluctuations). The econometric data is certainly mixed, but by and large the US appears to have reached a cyclical peak and is in a contraction.
Simply stated, I see a US recession, based upon contractions in industrial production and trade, reductions in full-time employment, and reductions in real personal income.