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  • What a week

    Alexander Gloy

    Looking at asset class performance during the week August 1-5, 2011: Horrible week for the Dax index, US REITs (Real Estate Investment Trusts) and Emerging Markets. I had wondered why the Dax managed to perform so well despite Euro zone troubles. It is a pretty cyclical index, and usually outperforms the US indices – in…

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  • Road Map to Ruin

    Alexander Gloy

      Budget deficits in “good” times, build-up of government debt Few countries’ (GER, NED) exports lead to trade deficits for others (GR, ESP, POR) Costly bank bail-outs and fiscal “stimulus” Monetary stimulus (0% interest rates); useless Rating agencies finally wake up (downgrades) PIIGS unable to sell more debt as yields rise IMF/EU (read: taxpayers) step…

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  • Greece: Two Bail-outs and a Funeral

    Alexander Gloy

    Here we go again. Another bail-out. [Sigh.] I’ll try to make this as entertaining and easily readable as possible – but first the details of the bail-out agreed on July 21st: Fresh EUR 109bn EFSF/IMF loans until mid-2014 Private sector (read: banks) participation of EUR 37bn EUR 12.6bn from bond repurchases at below par (100%)…

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  • Sector momentum table 2011-06-17

    Alexander Gloy

    Each week we test major asset classes for the strength of their momentum. We check: is current price above 20-day moving average? is current price above 50-day moving average? is 20-day moving average above the 50-day moving average? does the 20-day moving average have a positive slope (i.e. is it rising)? does the 50-day moving…

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  • Asset momentum table 2011-06-17

    Alexander Gloy

    Each week we test major asset classes for the strength of their momentum. We check: is current price above 20-day moving average? is current price above 50-day moving average? is 20-day moving average above the 50-day moving average? does the 20-day moving average have a positive slope (i.e. is it rising)? does the 50-day moving…

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  • Investment choices in a world of incompetent central bankers

    Alexander Gloy

    Much of the following next is an excerpt from the May 2011 “Letter to investors”. This is supposed to be”big-picture thinking” and will only be updated if warranted. 1. As the economy is artificially inflated so are company profits and stocks. The party might continue – until someone like Paul Volker gets installed at the Fed. It…

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  • Looking back: “We are buying Greek government bonds!”

    Alexander Gloy

    May 3, 2010. The EU and the IMF have just announced a EUR 110bn bail-out for Greece. Greek 10-year government bonds are yielding below 9%. German financial newspaper “Handelsblatt” launches a multi-page call to lure unsuspecting citizens into buying Greek government bonds. You can (and should) still read this master piece here. Gabor Steingart, editor-in-chief, opens…

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  • Hungarian adventures in CHF: Laszlo wasn’t alone drinking CHF-laced Kool Aid

    Alexander Gloy

    In 2006 and 2007, more than 90% of new Hungarian mortgages were denominated in foreign currencies. Many foreign banks (KBC, Bayerische Landesbank, Erste Bank, Intesa Sanpaolo, Raiffeisen, Unicredit) were luring Hungarians with low interest rates. At the time, Hungarian mortgage rates were around 9%, while Euro-mortgages cost around 4.5%. But those cheapo Swissies were to…

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  • Greece: What I learned from a Vietnamese Rickshaw Driver

    Alexander Gloy

    Traveling through Vietnam provided a few valuable lessons for life. You arrive, armed only with a copy of the Lonely Planet. Any map turns out to be pretty useless, as street names are frequently changed or the street layout completely altered (this is mid-1990’s). You are being inundated with offers from “cyclo-” (bicycle rickshaw) drivers.…

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  • What a taifun in Vietnam taught me about the Euro crisis

    Alexander Gloy

    As I was traveling through Vietnam in the mid-nineties our bus drove through an area visited by a taifun. The road was running on a slightly elevated dam, so initially there was no obstacle to continue the journey. Looking out of the window there was water on both sides as far as the eye could…

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