Posted on 10/16/2007 10:09:52 PM PDT by bruinbirdman
I'm a little more conservative with IWM.
For individual equities, I am way overweight energy.
yitbos
One of the primary reasons the Euro is so strong is their interest rates are much, much higher than ours.
yitbos
Oh ok - that said I guess inflation is a problem in a high priced commodities environment. Ecpecially for a country that doesn’t have much intrinsic efficiency for the use of oil and gas.
hu ? I though we got still 1% less then you guys.
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I just wanted to correct one of your comments. You are absolutely right that Euroland is not running a trade deficit and in most years runs a surplus. However, the combined Euroland economies run budget deficits larger than the US budget deficit (and ours is coming down to around 2% of GDP. Euroland has a restriction of budget deficits of 3% of GDP but many countries are seriously in excess of that. Furthermore, our public debt/GDP figure is around 64% which puts us below most Euroland countries (about equal with France and Germany).
I too watch the TIC reports carefully. My gauge is three consecutive negative reports, then long term rates explode to the upside and this credit cycle is history.
BUMP
DB:
Euro rates are lower than USD rates: 1 MO Euribor: 4.18% and 1 Mo LIBOR is 5.08%.
It’s the trade deficit although we actually run a surplus with a lot of the European countries. We are the No. 2 exporter in the world. It is the deficit with Asian countries and OPEC that are the problems.
RT
So far this year FXI & EWZ have had a great run. But when you look at the near vertical curve, it is time to cash in some chips.
Okay... Call me stupid...
I really did think the interest rates were significantly higher...
Sorry.
ping
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Awesome post Pro. So it seems to go long dollars big time, unleveraged, so you can hold for the long haul.
“Buy dollars young man...”
you’re only part stupid - the limees got more interests (higher then 5 if I recall correctly) US is 4.75 and EU 4
Seed articles/opinion so that the not-as-smart money takes positions OPPOSITE theirs. Think about this... At market turning points, i.e. if you are long, you need to go short to take your profits. So you don't "tout", 'Gee, I think we've reached the top so you other guys should start selling along with me so I get WORSE prices." No, it's "BUY, BUY, BUY, the market going to the moon...".
Capishe?
I’ll read the international finances seminar later.
That's probably the biggest question in international economics right now, even bigger than the Arabs messing around with oil. China is very rapidly building an urban middle class. It is about to become the world's largest automotive market. They've got traffic jams. Refrigerators, tv's, and washing machines have become standard in city apartments. So far, so good. The sooner China evolves as a mass consumer society, the better all around ... and urban China is bigger than either the U.S. or the EU.
But meanwhile, they've still got 600 million people out in the countryside, many of them desperately poor and willing to work for next to nothing. Sticky situation.
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