Forum
Posts by "speculator"
804
Posts Total by "speculator":
782 Posts by Anonymous "speculator":
rising bond yields will surely put pressure on global recovery and stock prices as cost of capital increases. we may get a shock and result in a flight to safety?
markets were pricing in a depression pre fed printing but have been repricing a recession based on the fed preventing banks going bust and restoring confidence in 'money.
inflation expectations can can improve stock prices as they are good hedge against inflation due to future income streams they bring. we moved from deflation which is stock negative to inflation that is stock positive.
also, deleveraging was too powerful and fast and brough about decade lows in US which probably caused some of the initial flows into stocks and some techinical buy side signals.
investors realised banks were actually safe due to feds actions of last resort lendor and if banking sector is guaranteed confidence normally improves etc.
the markets simply overestimated the extent of banking issues to start off with which chocked off any bullishness in stocks till fed came in.
its pretty hard to say how the year will end but i expect the market to pull back during autum this year as good news becomes the norm and mortgage interest rate shocks start to then hurt real estate markets and probably bring some poorer economic data.
thanks
btw, the euro seems to be overvalued by about 15% based on PPP. also looking rather bearish on the euro here.
it is no doubt as to why some sources expect sharp gains in dollar towards end of year. In the short term however dollar may look slightly bearish.
very slim chance of reaching 1.70 UNLESS S&P rallies over 1000 or ftse 5000. this rally is so tired and is running out of steam. i would be more inclined to stay clear of cable or be bearish for now.