World Equity Markets Selling Off

September 1, 2009 3 Comments

Money and finance

The reasons to be bullish on rates is not fully recognized by the investment community

World Equity Market Selling Off

World Equity Market Selling Off

World equities markets sold off last week — Europe off 0.7% and Asia looks like the Red sea. While the Nikkei was held to just a 0.4% dip (to 10,492), South Korea’s Kospi index lost 1.0%, the Hang Seng was crunched by 1.9% and China sagged 6.7% as the government moves to tighten the once-loose credit channels (the Shanghai index is now down 23% in the last four weeks).

The news flowing out of Asia, in terms of export growth, has also been disappointing after several months of better-than-expected results; consequently, shipping rates are slumping sharply. We are also hearing that rail cargo traffic in Germany is down 22% YoY, which is a record and calls into question the veracity of this so-called global inventory cycle. This is important to us folks on Amelia.

I was glad to see this show up in last week’s WSJ — Peak Theory in Government Bonds. The fact that it showed up on page C2 as opposed to page A1 is a good sign that the reasons to be bullish on rates is not fully recognized by the investment community. Once it becomes front-page news … it’s usually time to sell.

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3 Comments

  1. walterryan

    Have we forgotten this is a “global economy”? If other markets in the world are falling then what do we attribute our “news media” good news hype to????????

  2. walterryan

    Have we forgotten this is a “global economy”? If other markets in the world are falling then what do we attribute our “news media” good news hype to????????

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