Over the last month, gold companies have been among the weakest performeres in the MSCI World Index. On average they are down 9.4% over the last 30 days. They also top our ranking for the biggest drop in 30 day relative strength.
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There has been much discussion in recent years of the leverage buildup in the Chinese corporate sector and the problems (or not) that this will (or won’t) create, so we thought we’d chime in with some quantitative data and let the reader make his or her own conclusions.
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In spite of a better than expected monthly rise in production (in August), industrial activity in the five largest European countries continues to contract on a yearly basis– with the exception of Germany:And the recent tick down in the PMI Manufacturing survey would not suggest much of a reason to hope for material improvement in
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In addition to following price levels of the major stock indices, we like to look at various measures of stock market breadth to get a feeling for the level of broad participation in rallies or declines.
Read MoreNew monetary policies like QE have muddied the water somewhat when looking at monetary aggregates like M2. We have a simple adjustment we make to M2 to improve the optics on bank credit.
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Over the last year, between the FRB and commercial banks, around $500 billion in net new real estate credit has been extended. That is the good news. The concerning part is that the FRB has accounted for over 100% of all real estate credit created.
Read MoreThe US Dollar (USD) has turned against the Euro…check. It has turned against the GBP…check. It has turned against the Yen…check. It has turned against the Swiss franc…check. And, lastly it has turned against gold…check.
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The BOJ balance sheet has increased some 39% over the last year and the monetary base has increased about 46%. But, like in the US, the Japanese banks have just been parking their excess reserves right back at the BOJ.
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Inflation in the Spain and Italy is plunging at rates reminiscent of 2008-2009. From StreetAccount:Draghi says ECB guidance allows rate cuts on volatility: Bloomberg cited comments from ECB President Draghi, who said that the central bank’s pledge to maintain rates at low levels explicitly allows for cuts in lending costs if market volatility resumes.
Read MoreOver the last three months, the ”beta trade” has been on. We slice all 1,600 companies in the MSCI World index into deciles from lowest beta to highest, and then we measure the performance of each decile.
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