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

To: THE ANT who wrote (113863)	10/18/2015 9:15:11 PM
From: Elroy Jetson	Respond to of 219862

There's definitely bubble cycles in farmland. Chevron Land and Development wanted to buy more central valley farmland to plant almonds. The economics department had attached a fatuous graph to the request showing the value of farmland zooming up faster than home prices. I took their graph and added the rate of return of that same farm land based on tenant rent, and they were only three years away from seeing their return go negative - because the price of farmland was rising quickly in 1981, but farm profits were stable to declining. Plus they should have wanted to plant pistachios rather than almonds. The numbers on almonds were so absurdly good I called a professor at UC Davis and asked him what I was missing. He said that's an easy question,. You need to look at the acreage of almond trees planted but not yet producing - and there was a enormous number which a few years later pushed down almond prices as they began to produce. Pistachios take far longer to come to production so you end up with fewer competitors.

To: THE ANT who wrote (113863)	10/24/2015 1:11:50 AM
From: elmatador	Respond to of 219862

The tide is slowly turning: Brazil's current account deficit grew wider than expected in September but was easily covered by foreign investments, central bank data showed on Friday .... A weaker Brazilian real is helping exporters and curbing imports, boosting the country's trade balance after the country recorded its first deficit in 14 years in 2014.

To: THE ANT who wrote (113863)	10/24/2015 6:58:54 AM
From: elmatador	Respond to of 219862

more quantitative easing could be needed in the US, even after three previous rounds of the policy. FED is losing credibility with the biggest beneficiaries of its own stimulus policy — financial players with access to cheap credit. “What if there is a QE 4 and the market sells off?” asks one Singapore-based hedge fund manager. “There is no ammunition left. The Fed is out of bullets.” Wall Street takes a more cynical view of Fed stimulus Henny Sender The US Federal Reserve is losing credibility with the biggest beneficiaries of its own stimulus policy — financial players with access to cheap credit. Part of a brokerage report assessing the threats to financial markets noted last week that more quantitative easing could be needed in the US, even after three previous rounds of the policy. “We see another round of QE as one of the biggest risks to equities, suggesting $4.5tn was not enough to prop up the economy,” analysts at Bank of America Merrill Lynch wrote, adding that they were downgrading prospects both for the stock market and economic growth. “What if there is a QE 4 and the market sells off?” asks one Singapore-based hedge fund manager. “There is no ammunition left. The Fed is out of bullets.” Wall Street, in other words, seems to be belatedly joining the cynics’ camp regarding the effectiveness of the Fed’s policies. In retrospect, it seems apparent that QE was never really about supporting the real economy. Moreover, it is hard to believe in the healing effects of QE when growth rates in the economy remain locked in a long-established range between 2 per cent and 2.5 per cent. Indeed, with every quarter, the anticipated 3 per cent growth target recedes as the quarter approaches. Not surprisingly, Merrill Lynch just downgraded its forecast for economic growth for the second half of this year to 2.4 per cent. At least in the beginning, QE was all about stabilising financial markets, and driving investors into ever riskier financial products in order to earn any yield at all. But as both the markets and the analysts suggest, QE in the US has now outlived its mission. While originally QE did help heal financial markets, today it is contributing to volatility and increasing the likelihood of stress in financial markets. That volatility stems at least partly from the contradiction between easy money today and the reality of tighter money tomorrow. The pace of the dance between risk-on and risk-off is becoming far more frenetic as a result. A rise of 25 basis points is hardly enough to worry the real economy but it is enough to unnerve easily-spooked financial markets. On the prospect of a rate rise in September, high-yield markets dropped almost 5 per cent and credit spreads widened 275 basis points. Stocks fell 10 per cent in the US and almost 20 per cent in emerging markets. Then the markets reversed direction and money came flooding back in. The second week in October saw the largest US high-yield inflows in eight months and the largest emerging market debt inflows in five months. But looking beyond the short term, of particular concern is the possible combination of monetary tightening with deepening deflation, both generally and in asset prices. If easy money led to higher asset prices, in the absence of more robust economic growth and corporate earnings, surely tighter money will lead to lower asset prices. Many investment products that have performed well in recent years — everything from exchange traded funds to risk parity strategies — may turn out to have been the beneficiaries of a bull market that is now coming to an end. There are compounding factors as well. For example, when sentiment turns bearish, the liquidity will vanish because dealers will not be there to take the other side, thanks to the Fed in its capacity not as cheerleader for risk but as bank regulator. <div class="storyvideonojs"><div><p>You need JavaScript active on your browser in order to see this video.</p><img alt="No video" src="http://im.ft-static.com/m/img/logo/no_video.gif" /></div></div> Moreover, the rise of the dollar puts more pressure on a world that has a lot of dollar debt, much of which was borrowed for carry trades that now are no longer profitable, or to finance investment in commodities for which demand has dropped dramatically. “With the dollar up anywhere from 10 per cent to 25 per cent, we’ve effectively experienced a Fed rate hike without actually having one,” Steve Schwarzman, founder of Blackstone, noted in his earnings call last week (as the value of Blackstone’s portfolio companies dropped in line with the worst quarterly public market performance in four years in the US). In some ways, the world is scarier than it was at this time in 2008. “Compared to then, nothing is cheap and there is no monetary firepower left,” says one Hong Kong hedge fund manager.