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Where are we the moment and where are we going to?



Been a while since my last post, several reasons for this, at personal level I been having some serious health issues and at a more professional level been busy and studying the markets and finance as whole quite a bit lately.


 The World economy is decelerating quite a bit and by the way this is the official number , which is well know in many cases not to be a the true picture on the "ground":

The chart represents the three big engines of the world economy, the US,China & Germany and all are in a declining rate of change, even after further stimulus efforts made by the 3 central bans, The fed, the PBOC and the ECB, so in my opinion the action taken for example by PBOC in cutting RRR and the rate on deposits / Loans for 1 year maturity has not been extreme enough to "provoke" consumers & business to increase internal demand, please see the link bellow, another big problem is facing is the fact that the world economies are decreasing their demand for Chinese products, being the export markets one of their biggest GDP contributor is causing a serious headache to Chinese policy makers, plus the fact that their plans to offset this loss of external demand, by increasing their internal demand is not working as fast as they wanted, all this becoming one the main issues for Chinese monetary and economic policy, this kind of problems in the Chinese economy will translate to less raw commodities demand, as for example oil and copper, therefore I am bearish in those commodities and commodities in general, even after the problems caused by the Iran embargo by the EU is already in at work, the problems with Nordic countries disputes between Governments and unions of oil workers, which led to same loss of output. The problems at present with high price in corn, soy beans which may lead to a spill over to other food commodities/products, I believe are temporary and the recent spike in prices will abate, and I could go on with examples.

Global central banks interest rates


Europe is in a recession, is getting worst, and all the structural problems we saw as a cause to the last year and beginning of this one, which caused severe losses in the financial markets, with the banks being right in the middle of the epicenter, all those problems are still there, have not been dealt with in structural way and will come to daunt us sooner than later,however this problems may be kicked down the road again, as soon the ECB comes up with the LTRO3, which will give a bit more time to banks to heal their impaired balance sheets, with some more relevance for the case of Spanish and Italian financial institutions, I also believe even with the latest 100B Euros lifeline for the Spanish banks from the EU, this will not be enough plus Italy will also going to need to rescued, gain sooner then many people may expect. 


 I hope I am wrong, because if that will be the case, it will be because economies in the EU are doing much better, which will lead to the only solution for the "illness" of much of the southern Europe economies and the PIIGS, which summarizing is economic growth. However as I mention before at the moment I am bearish and prepared with some positions in place, in the form of options and some futures, to be exact I am short WTI @ 87.50, Short Gold @ $1615, Short the Euro @1.25 and short Eurostoxx 50 and will adjust accordingly and probably even increase my shorts!


 That is for today, this is where I stand at the moment, I am bearish Europe and the the main world economies, but of course there is plenty of buying opportunities out there, in the many growing economies around the world!

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