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  • In God we trust

    Alexander Gloy

    Sometimes I get accused of having “religious beliefs” in gold. Why is gold so valuable – because it’s rare, and expensive to extract from earth (ca $450 per ounce). However, it is impossible to calculate a “fair” price. I am the first one to admit that gold has no earnings, no dividend yield. You might…

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  • Greece cancels plans to sell additional debt

    Alexander Gloy

    Greece just cancelled a road show that was supposed to begin on Wednesday in London to sell more debt. The Prime Minister said “Greece won’t come to the market now” and “Greece is on target for deficit cuts”. Guys at the EFSF (European Financial Stability Fund) – on your marks! Looks like you might be…

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  • Irish and Portuguese spreads at all time highs

    Alexander Gloy

    All-time highs for Portuguese and Irish 10yr yield spreads: 10yr Portuguese government bond yields – intraday September 20, 2010. Source: Bloomberg. 10yr Irish government bond yields – intraday September 20, 2010. Source: Bloomberg. Market fears that tomorrow’s (9/21) EUR 1.5bn auction of fresh Irish debt (4 and 8 years) might not go well. Irish 10yr…

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  • More on BoJ intervention; Swiss unions demand same

    Alexander Gloy

    According to rumors the BoJ (Bank of Japan) last night spent JPY 100bn ($1.16bn) on currency interventions. The Yen weakened by 3%. Will the BoJ be successful? The Japanese trade balance is positive by JPY800bn per month (or JPY 40bn per trading day) meaning they would have to buy half a billion USD per day…

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  • BoJ intervenes to weaken JPY

    Alexander Gloy

    BoJ (Bank of Japan) intervenes for the first time since 2004 in the currency market after the Yen reached at 15-year high versus the USD (hurting Japanese exporters). According to rumors they are throwing JPY 200-300bn (USD 2.4-3.6bn) on the market. Not huge, but it draws a line in the sand. Unless other central banks…

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  • Gold reaches new all-time high

    Alexander Gloy

    Gold reached a new all-time high on Tuesday. Two broker reports were speculating about the possibility of further “quantitative easing” (= printing money) by the FOMC (Federal Open Market Committee), either after its meeting in September (21st) or November (2-3rd). Stock markets initially greeted the rumors with enthusiasm. But if those rumors were true, the…

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  • BoJ emergency meeting

    Alexander Gloy

    The BoJ (Bank of Japan) announced an emergency meeting for 5am GMT Thursday. According to rumors the recent strength in the Japanese Yen and falling share prices will force the BoJ into further “monetary easing” (read: printing money). Gold owners should rejoice – all major Central banks have now boarded the train of self-destruction. To…

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  • Friday 13th – predictions for the next 13 years:

    Alexander Gloy

    It’s Friday 13th, so here’s how things are going to pan out over the next 13 years: Greece is a tragedy. On May 7th they were already priced for a 30% haircut, and the banks prohibited it. So instead of dealing with EUR 210bn in debt (300bn *.7) they will be looking at 450bn in…

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  • ECB intervening in Irish Government Bonds?

    Alexander Gloy

    Stock markets falling word-wide, bond markets surging (prices up, yields down) – except a few outliers, like Ireland. Take a look at the intra-day yield of 10 year Irish government bonds; big rise, then sudden stop. Rumors of ECB having stepped in and buying Irish government bonds. To me, the chart looks like those rumors…

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  • How much longer will stocks be able to ignore signals from the bond market?

    Alexander Gloy

    FOMC (Federal Open Market Committee) met today, announced the reinvestment of maturing mortgage-backed securities into longer-dated Treasury bonds (2-10yr). Fed language unchanged (“to keep interest rates low for an extended period”), but economic outlook a bit gloomier. Bonds rallied, with US 10yr yield down to 2.78%, but stocks closer lower. This is logical, as no…

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