Rick comments on Europe
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I believe the logic in investing in Europe is as follows.
The stock market represents investment in real things.
As the Euro goes down, therefore the stock market in euros must go up.
Hedge against the currency risk (a win) and an investment in the stock market makes sense. (win-win)
Yeah CFS good point. Look what happened to the Japanese stock market as they hit the button for money printing in late 2012 to debase the Yen. It basically doubled and it went practially excatly inverse to the Yen.
HOPE PETER can exit before the bottom falls out………
Peter who?
I think Peter Brandt.
Thanks JMiller.
I think that a lot of the EU QE starting in March will end up… in the US and UK markets.
The European banks will take the cash and invest a siezeable chunk outside of Europe.
difficult to find common stocks in europe that seem cheap. Exception are oil stocks but too soon to buy them. buying preferred stocks on usa oil companys is working , but not many issues to buy . closed end funds on preferred stocks do exist, i own some. best of health and wealth to all S
There are a lot of higher dividend european stocks that look a heck of a lot better than US ones!
Yes, the cef’s of preferred stocks have worked out well for me as well the last 3 years. Not earth shattering, but nice gains and dividends of 7-8 % to boot. Also, corporate bond and u.s. govt. bond ETFs have treated me well the last 2 years. This has been good to me during this pm bear market, enabllng sleep and not having to be married to computer screen. Works for me, but danger is coming if martin Armstrong and others are right.
Greece Latest:
We need more time to write up our reform list.
Maybe by tomorrow (Tuesday).
Greece – New Gov’t Signs it Own Death Warrant
http://armstrongeconomics.com/2015/02/22/greece-new-govt-signs-it-own-death-warrant/
Fractional reserve ponzi scheme in Greece will be in full working order.
Greek economy in numbers
Unemployment is at 25%, with youth unemployment almost 50% (corresponding eurozone averages: 11.4% and 23%)
Economy has shrunk by 25% since the start of the eurozone crisis
Country’s debt is 175% of GDP
Borrowed €240bn (£188bn) from the EU, the ECB and the IMF
Rick, the intractable joblessness in Europe is great for lowering wages and great for big European ‘blue chip’ corporations in countries like Germany and others.
The weak Euro that may result from Eurozone QE and the constantly bubbling Greek crisis is also great for those corporations.
The ‘strong dollar’ by comparison is also great for their exports.
Peter talks and writes like a chart watcher and main European stock markets are at or past their 2000 or 2007 highs. So he is simiply looking for a breakout as has happaned with the S&P500 and Dow indices.
This page is also a great one from Peter Brandt:
https://www.scribd.com/doc/244612133/Chart-History-of-Gold-Market
It seems to me that part of the “joblessness” in Europe (certainly in the UK0 is driven by welfare out-paying employment.
The other problem about “joblessness” is the accuracy of statistics when vast numbers of southern europeans cheat on taxes, and would not hesitate in lying to pole takers/census takers, etc.
A weak euro is useful, perhaps, to Germany, but you’ll have to remind me just what it is that Greece exports. The same skepticism could apply to MOST eurozone countries these days. Germany aside, their export economies cannot be goosed sufficiently by a cheaper euro to overcome the structural drag that is killing Europe’s economy.
They have a strategy over there that is not well known to all but it involves creating regulatory burdens on virtually every aspect of commercial life that they know cannot be met by most of the competitors from China and Asia.
Packaged canned foods are one example and so are the kinds of metal cans that are used. Chemical additive laws, rules on the size and color of fruits of vegetables, the type of stainless steel that MUST be used in processing dairy products…and the list goes on endlessly.
This is ALL designed to protect the European open market and block cheap imports from more competitive countries. My wife’s friend for example could not meet the requirements of cheese production for export to Europe out of Africa unless they bought equipment manufactured to the very high set standards.
The Chinese make good equipment but it is not acceptable by EU rules. The Italians make the equipment too but it is so pricey that there is no chance of a profit margin for years in the future if you must meet the ISO qualifications and have the paperwork the steel was properly treated.
The whole thing is a rats-nest of hurdles and paperwork and excessive capital investment meant to protect markets and keep low cost products out of the stream. And nothing more.
Once the system breaks down (as it must) as deflationary forces surface and end the pretense then we will have a whole new list of hurdles to overcome because it seems just obvious that import duties and stamp taxes are going to be the last refuge of the bureaucracy in defending Europe’s current high wage arena and its impossible promises to the citizens.
The extent to which the European economy stinks is illustrated by the fact that even though their currency is weak and has fallen a lot recently, which should be inflationary to consumer prices, they STILL have deflation!
However, Rick knows better. Fundamentals don’t matter as he has said many times previously so he has contradicted himself a bit here by talking about fundamentals.
Where is more than a trillion dollars worth of Euro QE going to go? Well, where did it go in the USA in the past 6 years? Into the real economy? Er, NOPE! Into the stock market, well maybe, just like in the USA from 2009-2015. In the case of Europe this real QE has hardly started. It is like the USA in 2009. Cory’s closing remark was absolutely the one to hear.
Yep, it will go into stocks. Whether that will be just be European stocks though I have my doubts.
I said that fundamentals are irrelevant to stock prices. But fundamentals surely are relevant when you are talking about, for one, why European “kids” are living with their parents till they are 40, and why eurograds with two master’s degrees, a PhD and no family connections cannot even hope to find a job. And even the ones lucky enough to get hired are going to work for governments whose job is to kill the private economy at the expense of the public one.
Do you trade Gold? If so, you may find the actionable ‘touts’ I put out each night for Comex futures useful. Here’s one from today that worked nicely. Judge for yourself whether you could have made money following my instructions:
“We’ve been using an 1187.60 target to keep a step ahead of the bear, but the 1183.40 Hidden Pivot shown looks more compelling at this point. Accordingly, I’ll recommend bottom-fishing with an 1182.90 stop-loss, but only if you’ve held a short position on the way down. Camouflage is the suggested method of getting short, but if you prefer the simplicity of a ‘mechanical’ entry, offer at 1203.20, stop 1208.80, making the stop-loss o-c-o with a bid to cover the position at 1184.00. Optionally, you could try bottom-fishing at 1187.60 with a stop-loss as tight as 4 ticks. Please report any fills in the chat room so that I can establish a tracking position for your further guidance. _______ UPDATE (Monday morning): Getting short at 1203.20 as suggested could have produced a gain per contract of as much as $1400, since the futures fell to 1190.60 overnight. A stop-loss as tight as $1.60 would have sufficed, since the futures went no higher overnight than 1204.70.”
People invest in Greece because it was the cradle of democracy, 2790 years ago. Then, MF Global went bankrupt.
ANYBODY……..following …………….ROMARCO MINERIALS…………..thanks……..j
To be or not to be?
Greece or Germany out of the Euro first.
That is the real question.