Tuesday, December 27, 2016

Global stock markets to face problems next year 2017

The main factor right now is Mr Trump and his talk - which we are all watching here. But again, now we are going to have to start focusing on interest rates and what’s happening in the real economy, where there’s a lot of debt. 

So, for instance, in India and China too, there is a lot of debt now. There was not as much debt there earlier, even ten years ago. So we all will have to start paying attention to the interest rate burden which everybody is going to suffer.

And unless Mr. Trump can do something about those three trillion dollars of American corporate money overseas - which would help finance the things he is talking about - we all are going to face problems. I expect problems next year in the financial markets worldwide. I don’t expect good times.

Monday, December 26, 2016

US corporations have 3 TRILLION DOLLARS parked overseas

I own a lot of the U.S. dollar, and I have l for a while as you know. I own it partly because there is a lot of turmoil coming and people look for a safe haven in times of turmoil. They think the U.S. dollar is a safe haven. Mind you, it’s not, but people still think it is. Plus, American corporations have three trillion - trillion with a ‘T’ - U.S. dollars outside America.

Mr Trump says he is going to figure out a way to get them to bring that money back. If he gets three trillion dollars to come back into the U.S., that’s going to do a lot for the U.S. dollar and it is going to help the markets for a while. So, the good news - we all know the good news that’s what we are focusing at the moment, I own a lot of U.S. dollars because of that.

Wednesday, December 21, 2016

Russian stocks attractive due to positive developments

Russia is a hated stock market, very depressed right now. I went Russia last week and as you probably know, Mr Trump says he likes Mr Putin. The new Secretary of State in the U.S. is a great friend of Russia, he loves Russia... so the pressure is coming off for Russia. The person who well may be the President of France also likes Mr. Putin, more and more politicians in Finland, Norway are saying ‘we like Mr Putin’.

So Russia is the market which I still find attractive. It’s very depressed still but lot of things are starting to happen.

Tuesday, December 20, 2016

America needs Trump's infrastructure rebuilding

Well Mr Trump has said he is going to cut taxes. That’s great for any economy. He has said he is going to rebuild America’s failed infrastructure. We desperately need it, it has been a problem, and the market is paying attention to that. He said he is going to deregulate a lot of things. The market loves it because they expect it to be better. He said he is going to cut taxes for corporations. Which means their profits would be higher.

But I doubt where the money for all of this will come from. At the moment everybody is watching the good news, and not thinking about the possible bad news. 

Mr Trump has insisted often that he will have trade wars with China, India and other people, and the market is ignoring that right now. Maybe he’s not going to do it. If he does stay away from the trade wars, the American economy will be better next year, as will the world economy. But, yes the market is far ahead of itself at the moment.

Monday, December 19, 2016

The markets will continue to go up regardless of the Fed raising rates

You know that Federal Reserve, last December said they will raise interest rate four times in 2016. They raised interest rate once. So I just don’t pay attention to them. They follow the market. But, you should follow the market and not the central banks.

The thing with the Federal Reserve is that the market will tell them what to do! I suspect, as you know, interest rates have already started going up in the market.

So I suspect the market will continue to go higher, whether the Fed raises interest rates once or four times, I don’t particularly care. I’m watching the markets. And the interest rates in the market are going higher.

Monday, December 5, 2016

On the latest OPEC output cut deal

On OPEC deal announcement to slash oil output
Lets wait and see if they actually do it. We have had these announcements for 30 or 40 years, most of them have not pan out but it certainly makes oil go up today and it will probably go up for a while. The fundamentals of oil continue to improve. Exploration has been going down. The supply has been going down and will continue to go down.

On Iran 
They need money, lets see if they actually do it. I am skeptical.

Where Crude Oil could go
Crude prices fluctuate up and down. They have ranged between $40 and $30 and that will probably continue for a while, more likely towards the upside than the downside. Yes, $60 a barrel is not an unusual number. It is still way down from where crude prices were just two years ago

Own energy
I own oil but I'm a terrible market timer. One should own energy, as the energy reserves continue to decline worldwide. Saudi Arabia has not had a major find in many years, nobody has. Iraq, Nigeria and Iran nobody has found a lot of oil, except for the frackers. The fundamentals of oil continue to improve.

Trump effect on commodities
He said he is going to cut taxes which is great always for any country and he said he is going to increase infrastructure spending. So you have demand growing in the US and the countries supplying the US. The problem of course is where is the money going to come from. This could go on for a while certainly for commodities.