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

To: 2MAR$ who wrote (73448)	4/21/2011 3:46:25 PM
From: Cogito Ergo Sum	Read Replies (2) \| Respond to of 217560

So how soon does the US change from not wanting an oilsands pipe south to not wanting one west ex Alberta :O)

To: 2MAR$ who wrote (73448)	4/21/2011 5:44:32 PM
From: elmatador	Respond to of 217560

'problem" states Iran, Sudan and lately, Syria.? And we thought the problem states were Tunisia, Libya, Egypt, Bahrain and Yemen! not to mention Iraq and Afghanistan.

To: 2MAR$ who wrote (73448)	4/21/2011 7:01:26 PM
From: TobagoJack	Respond to of 217560

just in in-tray, a good one · The S&P threat to downgrade the US triple-A sovereign credit rating this week will make an interesting footnote in future history books describing the last years of the US dollar paper standard. It is remarkable that such action has not occurred earlier given the alarming rate of fiscal deterioration in the US since the financial crisis. · For now at least America remains the only major Western power not trying to do something about its fiscal dilemma. This reflects the reality of the US dollar’s continuing reserve currency status and the resulting luxury in Washington of being able to borrow money that the Federal Reserve creates. · The consequence of the Ryan Plan has been to move the fiscal issue for now to centre stage in the context of American politics. But it does not mean that meaningful fiscal retrenchment is a certainty. There is a real risk that the Ryan initiative on entitlement cuts proves an electoral liability for the Republicans in terms of handing the Democrats the cherished middle ground. · For now investors should continue to assume that Washington follows past practice and votes for further monetary and fiscal stimulus at the first signs of fading economic momentum or indeed of fading stock market momentum. · It increasingly makes sense for institutional investors to keep a percentage of their liquidity in gold bullion on the view that it is fast becoming a better proxy for cash. This view will continue to make sense so long as real interest rates in the West are not rising. It is impossible to give investors a precise “road map” of how the US dollar paper standard unwinds because it all depends on the chronology of the policy response. · GREED & fear’s key advice is for investors to remain long gold and not to be tempted to take profits. For the bull market in gold has not even begun to go parabolic. GREED & fear’s continuing preference is physical bullion and, for those people in the investment business, unhedged gold mining shares. · It is preferable to own physical bullion than what could be described as “paper gold”. As gold fever builds, assuming America does not get serious about thrift, then the likelihood grows that the market starts to distinguish between real physical gold and paper claims to gold. Such a development will mark just another aspect of the loss of confidence in paper money. · Silver has outperformed gold in recent months. GREED & fear has tended to view silver as a high beta gold with genuine characteristics as a precious metal. Because of its lower denomination silver could also be viewed as a poor man’s gold since it costs “less” to buy. This is the same analogue as a share split which makes it appear cheaper for a retail investor to buy a stock because the nominal amount is lower. · GREED & fear has had a 1.2-1.4 trading range in mind for the US$/euro exchange rate, though the euro has of late risen well through the top end of this range on the foreign exchange market’s view of improving interest rate differentials with the resumption of ECB tightening. Still GREED & fear would not want to buy the euro at these levels. This simply underlines the dilemma posed by the relative ugly context. · The problems of the Euroland periphery have not gone away. Germany is reportedly drawing up plans to restructure Greek sovereign debt. The problem of any formal restructuring of Greek government debt would be the damage it would inflict on the capital of the Greek banking system. · Spain is much more like Ireland than Greece or Portugal in that it began the crisis with a relatively modest sovereign debt burden but a hopelessly extended banking system and property market. But in stark contrast to Ireland, Spain is in no hurry to “fess up” to its banking sector’s problems. Rather the strategy appears to be to go for a long work out which probably means years of weak growth. GREED & fear continues to advise macro investors to put on the Spanish flu CDS trade. · GREED & fear also continues to advise investors to remain long German CDS. Despite the success of the anti-bailout party in Finland, the base case remains that the Euroland core, led by Berlin, at some point will agree to some sort of collective fiscal responsibility. · If the euro looks overvalued, the Swiss franc now seems monumentally overvalued. While all the momentum remains in the Swiss franc’s favour, macro investors might consider shorting the Swiss franc against the US dollar given that the pendulum has swung so far, albeit with a tight stop. · GREED & fear’s favourite trade would be to short the Swiss currency against the Singapore dollar. While the Swiss franc is still seen as a safe haven currency, GREED & fear’s view is that the Singapore dollar, as an emerging private banking currency, is a better longer store of value. GREED & fear’s long term target remains S$0.8 against the US dollar. · Taiwan’s Central Election Commission has decided that the next set of presidential and legislative elections should be held together for the first time. This increases the chance of positive cross-strait related newsflow happening sooner rather than later; most particularly in the second half of this calendar year. GREED & fear continues to advise investors to own the constituents of CLSA’s Capital Links portfolio. The existing overweight in Indonesia in the Asia Pacific ex-Japan relative-return portfolio will be increased by 1ppt with the money taken from Malaysia. Indonesia remains a strong domestic-demand story with the economy increasingly driven by investment as well as consumption. 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.