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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Cogito Ergo Sum who wrote (65870)	9/2/2010 1:13:24 AM
From: energyplay	Read Replies (1) \| Respond to of 217650

Now Mexico looks like a head and shoulders pattern, meaning a big DOWN coming. The recent highs don't break the old highs, and the lows are edging lower.... about 45 should be critical level, below that, it could go to 37 or less...

To: Cogito Ergo Sum who wrote (65870)	9/3/2010 10:22:52 PM
From: TobagoJack	2 Recommendations Read Replies (2) \| Respond to of 217650

just in in-tray, per greed n fear · Deflationary forces continue to mount and GREED & fear maintains the bearish view on stock markets with the seasonally weak period for equities, namely September and October, having formally commenced. The central point remains that the quicker the US stock market falls from here, the quicker the Fed will commence the next wave of quantitative easing. · Ben Bernanke is still clinging to hopes for a “pickup in growth in 2011”. But that Billyboy still believes in quanto easing was clear from his articulation in a speech last week of how the Fed could buy securities again if necessary. Bernanke also stressed that the Fed was ready and willing to fight unemployment as much as deflation. · The reasons GREED & fear does not agree with Ben Bernanke on 2011 prospects are that the US housing market remains on life support, that the US fiscal stimulus is waning and that the US consumer is exhausted. This leaves only capital spending as a motor and the current capex cycle is likely to be short lived. · GREED & fear sees no immediate relief on the yen front. With a risk averse equity correction expected to continue in the near term, and with no credible intervention taking place, the overwhelming likelihood is that the foreign exchange market will continue to push the yen up. · The BoJ did as little as it possibly could at its special emergency meeting on Monday. The BoJ’s reluctance to resume quanto easing can be explained by its continuing scepticism about the effectiveness of quanto easing. · Dedicated Japanese investors need to orientate their portfolios more than ever to those quoted Japanese companies who are geared to China and other emerging market stories in Asia. This is particularly the case as the next wave of quanto easing in America will trigger the next wave of Asian and emerging market outperformance. · As the risk rises of an increase in deflationary pressures, so does the risk of renewed problems in the Japanese banking system. While it is true that the credit risk for the mega banks has seemingly reduced in recent years since their main business now is to own bonds and take deposits rather than lend money, the same is not so true for the regional banks which continue to lend to SMEs. · Another issue that has of late come to the fore is the end of any hopes for now of a major political realignment in Japan. If Ozawa does win the DPJ election on 14 September, it will be a sign of how dysfunctional Japanese politics has become. · A return of Ozawa to power will likely initiate a more interventionist approach to economic policy which a desperate stock market might appreciate. One possibility, which GREED & fear views as more likely at present than active yen intervention, is pressure on the Bank of Japan to mount a renewed Price Keeping Operation in terms of buying stocks. The other likelihood is a more expansionist fiscal policy. · For those investors who believe like GREED & fear that much of the Western world is at growing risk of entering a Japanese-style liquidity trap, the Japanese stock market offers a superior relative story. This is because valuations in Japan already discount the deflationary reality. · It looks increasingly likely that Japan’s so far 20-year-long flirtation with creeping deflation will finally climax with a fiscal crisis that will trigger a sudden move from deflation to hyperinflation. But the timing of that inflection point remains unknowable given the undoubted capacity of this most consensus of cultures to take trends to seemingly ludicrous extremes. · GREED & fear will make a few changes in the Japanese long-only portfolio to move the portfolio even further in the direction of Asian and emerging market gearing. The investment in Japanese bank SMFG will be removed with the money placed evenly in Suzuki Motor, Fanuc, Sumitomo Metal Mining and Kubota. The investment in Toyota Boshoku will also be replaced by an investment in truck maker Isuzu. · While the yen has been rallying, the Japanese investment trust industry continues to make a living offering Japanese retail investors higher yielding investments offshore. From an Asian perspective there is now a growing interest investing in rupiah fixed income products given the relatively attractive yields, the recent stability of the rupiah and Indonesia’s strong fiscal position. Such flows can only be a positive for maintaining momentum behind the Indonesian story. · The latest set back for the Asian asset reflation story has been further measures announced by the Singapore government this week to stem property speculation. Still GREED & fear continues to view such moves as only slowing down the Asian asset reflation story, not ending it. GREED & fear continues to believe that the main beneficiary of the next wave of quanto easing will again be owners of asset prices in Asia, not struggling US consumers. · The weighting in Singapore in the Asia Pacific ex-Japan relative-return portfolio will be reduced by one percentage point with money added to Malaysia. One percentage point will also be initiated in Thailand with the money taken from Hong Kong. Please consider the environment before printing this email. The content of this communication is subject to CLSA Legal and Regulatory Notices These can be viewed at clsa.com or sent to you upon request.