Lighthouse Investment Management

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Author: Alexander Gloy

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  • Event calendar

    Alexander Gloy

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  • All roads lead to a disintegration of the Euro

    Alexander Gloy

    Our investment thesis can be summarized as follows: Equities are worthless when associated debt becomes encumbered (risk capital takes the  first loss). Equity is not an asset; it is merely the remainder that is left over once debt is subtracted from assets. Recent GDP growth was possible only thanks to massive deficit spending and monetary…

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  • Rational decisions in closed systems

    Alexander Gloy

    In closed systems, rational decisions lead to irrational outcomes. Take a crowded stadium. A fight or fire breaks out. Panic ensues, and everybody scrambles to get out as fast as possible (rational). In the process, people are hurt or trampled to death (irrational). The same applies to the stock market. Rational behavior demands you buy…

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  • David versus Goliath – the SNB against everybody else

    Alexander Gloy

    A picture says more than a hundred words, so I wanted to present in graphical terms what happened at the Swiss National Bank over the last few quarters. Unfortunately, the SNB does not provide foreign currency positions including derivatives on an absolute basis, but here are the unhedged figures:   The SNB increased FX positions…

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  • Mental contortions of a printing machine operator

    Alexander Gloy

    “We never pre-commit” is the standard answer the ECB (European Central Bank) has for anyone asking about future interest rates (journalists regularly waste one of their two permitted questions at ECB press conferences). Why should central bankers not indicate future interest rates decisions? Because market participants will price that information accordingly, so the announcement would…

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  • Technical analysis February 8, 2012

    Alexander Gloy

    Time to take a look again at the technical picture of the S&P 500 Index, which seems to be in a nice uptrend, undeterred from anything: If only the volume was increasing (usually, higher prices are met with higher volumes as more investors are willing to part with their shares and buyers have to “eat”…

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  • “Nobody understands debt (but me)”

    Alexander Gloy

    Luckily they are easy to spot: the demagogues, the manipulators and the hired claqueurs. Unfortunately, there is no lack of media willing to provide a platform to perform their insidious game. Take Nobel-prize wielding economist Paul Krugman. In an article for the New York Times (“Nobody understands debt”) from January 1, 2012, he writes: “Through…

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  • Inside Job at the SNB?

    Alexander Gloy

    The official version: “Enormously dedicated” SNB chairman Philipp Hildebrand purchases 500,000 USD days before he devalues the Swiss Franc by 10%. This plain-vanilla spot currency transaction becomes “water cooler” story at Bank Sarasin (which wouldn’t even open accounts below 1 million minimum deposit). An IT employee takes pictures of incriminating documents, briefly weighs the consequences…

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  • Sales of gold and silver coins soaring at the US Mint?

    Alexander Gloy

    An article by Bloomberg “Gold Traders Most Bullish After Bear Market Averted” grabbed my attention; not because of the headline, but what was buried in the text: “The US Mint sold 45,500 ounces of American Eagle gold coins this month, compared with 65,500 ounces in the whole of December and 41,000 in November, its website showed.”…

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  • The 2-product, 2-customer wonder called Australia

    Alexander Gloy

    Australia is the sixth-largest country (2.9m square miles) on earth, just a tad smaller than the contiguous United States (3.1m). They are a little short on people (22.8m), which comes handy, since they dig up their entire country and sell the dirt to China. Australia has a remarkably low government debt-to-GDP ratio (29% ), low unemployment…

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