Following the reduction in UK rates (from 4.5% to 3%) and Switzerland, the ECB has decided to follow suit with a drop of 0.5 points from 3.75% to 3.25%. The threat of recession and lower inflationary pressure driven by the falling price of oil has encouraged Trichet and his team to make this decision. But the drop was not as strong as many analysts expected and the stock markets have reacted with immediate decreases. Meanwhile, we have to Euribor with the most bearish streak since 2000.
What do you think of this fall? Is it enough or more bullets left in the room? What is more correct, the bestial down the Bank of England or as little risky strategy of the ECB?
PS: For you have come late, I remind you that you rule the day here.
Written by Carlos Lopez on November 6, 2008 with 277 comments
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The Nobel Prize in Physics Richard Feynman defined science as the following process:
"First we calculate a prediction and the implications it may have. Then compare the hypothesis with the results of the experiment. If you do not agree, then serve. In this simple statement is the key to science. No matter what beautiful or intelligent or reasonable is the theory. No matter what you're ready, who has made the prediction or how important is your university. If not consistent with the experiments is wrong. "
The statistic is what happens, do not care that it is not reasonable that sometimes simply because they meet standards have been met in the past. If they work then we can give a scientific value, but I can not understand why they happen. For example, this chart shows very clearly that the values do little better than half of the big in November and December:
He that is because it is easier to manipulate for the annual closure may be the reason but it does not matter too much to know why. Now enter the most bullish seasonal period of the year:
Bags historical average do better, even if we look back over 100 years ago, from November to April, May and October. This is not to say, much less that half of the bags fall from May to October, but only half of that long-term and do so without any kind of doubt worse. The chart is also clear, even spectacularly clear:
These guidelines are a tool, but together with other findings. Carpathian said a few days ago a study by Bespoke Investment Group using data from 1900 to 2008 which reads:
The average duration of the 21 recessions that there has been 14.4 months. The average loss has come to the Dow Jones was -24.2%. The loss was the most devastating recession of August 1929 to March 1933, where it lost 88.2%. The duration was 43 months. As we are still far from able to compare with that disastrous situation. The loss was less in the recession of July 1953 to May 1954, where it fell 5.2%, hard 10 months. 16 of the 21 recessions conform well to the average, and only had 4 lasting more than 20 months.
But the most interesting study is another issue that I said the other day in my article on whether or not to buy yet:
The bags, with very few exceptions, are beginning to discount well before the end of recessions, so as usual, is that when data are still coming out very bad start of the ascent. The historical average from 1900 said that the floors of stock exchanges is the height of up to 58.4% of the duration of a recession. One surprising and I think that tells us that it is normal that when remontadas start half remaining seven months of bad data and gloomy. Only 4 times was that the soil is at the level of 80% or more of the duration of the recession.
In addition to the market traded a 2008 PER of 11.3 x 9.4 x PER 2009 for the S & P500. These figures are well below the historical average of 15.1 x PER of the S & P 500, indicating a discount of 40% over the historical average, or that these levels of valuation discount that there is a high risk that the benefits estimated by the consensus for 2009 in the S & P 500 are inflated by 40%. How do you know? In short, I still believe we have not seen the minimum bearish trend but I believe it is my duty to report these peculiarities and commented that the statistics show that:
- Not because the data are ill should not be buying, despite what it seems. Is more reliable surveys that follow the data as it is to predict the end of the recession. For example, it is more reliable data for building permits (which implies a trend in future) the fact that houses built.
- If the analysts are not wrong, for the book value of shares are historically cheap.
- We entered a time of year usually bullish and that usually lasts 6 months.
- Bassists are the years in which there is more interest in order to manipulate the end of the year.
Moreover, the seasonal patterns not only apply to the bag, also work with other products. For example, the oil tends to lower-or-less top-end of the year on average.
PS - And before I read the comments of suspected manipulation by the American elections, the truth is that I have not seen any reliable statistics, but it is curious that just two years ago, in the last parliamentary elections in the U.S., and commented that had intervened to lower oil prices artificially and thus benefit the Republican Party: http://www.crisisenergetica.org/article.php?story=20061004102546877 Then they earned little but is curious about how as the election date shows the low $ and crude oil ...
And finally, the usual summary of the press.
Written by Droblo on October 29, 2008 with 259 comments
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In November will be a year of the historic highs of the American exchange and Spanish. The anniversary coincides with a stock market and financial crisis that has led many states to use public money to try to resolve the situation. Just in between those dates to April 2007 - came out a press release today that seems to forget: The G7 raised an ultimatum to the banks which gave them 100 days to revealing all of their losses. G7 decided that the same these days, along with other economic institutions and policies, go to the aid of those same banks that ignored the ultimatum.
They say that it was necessary, it is possible, but these banks are still the same executives and managers who took such a disastrous policy which required huge amounts of public money to survive. How is it possible that a blank check to solve this to the mismanaged and that it also ignored the warnings?
Review some links:
This could be very long but is easily summarize: The FED dropped rates in late summer 2007 thereby delaying a solution to the crisis and the stock exchanges in November (both the SP500 as the Ibex) touched historic highs, in a movement of blindness over economic reality. Falls in January was attributed to the "mad trader" and from June to a summer storm ... and has taken the collapse of these days to finally act together.
Hopefully it is true that it is not too late but I think it took too much. And of course what we consider unacceptable is that no heads roll. Many people have been complicit and active-passive-of the current crisis, but who spent 120% of their income on credit and trust in the wrong expectations in their meat is suffering the consequences. Many innocent, too. Mismanaged companies close or change their management teams, but what happens to the treasurers of banks, managers of pension funds, what happens to the policy makers, what happens to the ratings agencies, and the recommendations of analysts?
In April this year was very famous video in which CNBC interviewed Meredith Whitney, an analyst at Oppenhaimer and unexpectedly asked about the survival of Lehman and she naturally thought it would end up bankrupt, spent several seconds without knowing what say, between doubting whether or not to tell the truth cause "mistrust," was his famous "mmm". She and her bank were among the few who take months and months recommending selling in banks and announcing that they rebajarían dividend and capital increase, which the directors of these banks refused and returned to deny. Now the "totem" is to give confidence, that means not tell the truth? Or stick with the comment made by the same time one of the most prestigious Spanish analysts from the Internet: "I recommend buying the stock market because years ending in 8, in January when he has behaved badly, often with great force on top everything from the first quarter, so a year that ends in 8, in January has behaved very badly, it is very likely to raise a minimum of 30% since the first quarter. "
But this is anecdotal compared to what happens to the heads: How is it that has not resigned after Paulson stressed many times the financial strength of Bear Stearns, Fannie Mae and Freddie Mac among others? And Bernanke, how was not affected by its mismanagement of the crisis? Where are the resignations from the ratings agencies that ensured the financial strength of many institutions fall? Why do governments have not demanded purges of personnel responsible for the banks to inject capital? How is it possible to continue in the same place as AIG and waste?
Can not be that the average citizen who has been affected by a crisis that is hardly the only means to suffer the consequences and use the money from their taxes for those who have led us to the crisis and continue all their accomplices in their seats. Does it have to recover confidence? True, but that there is nothing better than sincerity and responsibility. We tell the truth once and they do not undermine the state's income by some managers who have brought us to this, not to provide or arrange knew. Without accountability monetary, political and even criminal if necessary, I believe that it will not be a lack of confidence in the system.
Written by Droblo on October 23, 2008 with 241 comments
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We could say that statistically Icelandic women are prettier and the guys in the world, because with only 300,000 inhabitants have put a Miss world and have two winners of the championship's strongest man in the world. People are also lists as a 99.9% of the population is literate and to finish the task, much as they live their life expectancy is 81.5 years, the second highest in the world. All this together with the air that gives them the peace have no army. Surely a place to live, if you do not mind the cold and darkness. In fact, the chess player Bobby Fisher ended his days in that country, although it was not very sane.
But what will not feel proud if we win and win is by debt. If six years ago had wanted to pay all debts that have their banks abroad would have consisted of each of its residents about $ 26,000. A lot does not it? but what is worse now, if you wanted to pay its debts today, would have to pay $ 280,000 per head.
Much has been written on the net about the situation in this country (even commented here for half a year) and can provide little new. We really impressed that a European country can go bankrupt but remember that only has 300,000 inhabitants and therefore must be given the importance it has. In fact, the Banco de Santander (which posts to wander, we could imagine in bankruptcy) has nearly 130,000 employees which means it probably has more workers Iceland whole.
In the end the entire Icelandic saga comes in the wake of the interest rates were so high that (15%) in an environment of moderate inflation, thereby saving many international (mainly English) to invest their savings and there it was worse for the Icelanders, the amount of loans requested both the public and businesses and banks outside the country, attracted by lower interest abroad. Successive devaluations of its currency did the rest.
A few days ago, a British financial portal made public a letter sent by internal CEOs of Landsbanki, one of the great institutions nationalized the country, to employees (Short and hit Expansion)
"Times have changed. In recent weeks, the international financial markets have deteriorated as not seen since the beginning of the century. Many other banks have fallen and they will. Governments are taking extraordinary measures to adapt to change. Iceland is now the victim of a lack of liquidity plaguing the world. "
As you can see, there is no risk-free return and the long rates as high as irrationally low end crashing. In this case will be that the IMF has to come to the rescue as if it were a Third World country and launch a plan of 4,500 billion Euros. A clear example of those who bought a bike that could not.
As a demonstration of curiosity and that money is very miedica, Icelanders who do not trust their banks like crazy looking for alternatives for their savings and including luxury watches have become a good alternative, at least so says a representative Rolex.
"Customers want something they may have in hand. They have no confidence in the numbers of their computers, because they saw these figures fade "
This statement must pick with tweezers (it seems more a press release of the watch), but it is clear that if there are any good tangible fear gives us more security.
And to finish with the Icelandic Culebron recent success and taking the rating agencies, do not forget that not many years ago the bonds of Iceland had the credit rating of AAA (later downgraded to Aaa, which is not bad) look which said the past year and a half.
"Iceland is not experiencing excessive risk to the solvency or liquidity as a result of the recent volatility in financial and business cycles," said Moody's Investors Service in a note published today. The firm maintains the highest rating of Aaa to the island's north.
"Iceland is well positioned to deal with any potential problems in its financial resources that might emanate from a systemic problem in any sector of its economy," says the analyst. "Our Aaa rating is compatible with such a scenario," he adds.
The key ....
So in conclusion, that we see today means:
Written by Carlos Lopez on October 22, 2008 with 388 comments
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Not so long ago I saw several news media about the relevance of "crudívoros" some individuals rather peculiar because although not vegetarians in your life have ever tried a roast lamb because they eat raw food. Many also are even more pure and practicing naturism. As véis information is removed from our concept of life, but despite everything, including such "tribes" would have it very difficult to live without banks, so for this interesting article this rescado Can we dispense with the banks?
In a recent report by the Bank of Spain said that payment means no more than 3% of financial transactions in our country are paid in cash. The agency puts the direct debit of receipts to the head (46%), followed by debit cards and credit (31%), transfers (16%) and checks (4%), except that in terms amount, transfers out with 76% of the total. However, despite these data, the answer to the question whether one can live without having any relationship with the bank, no doubt entails: Yes, you can. Nobody can force a citizen to receive a pay domiciled in your account, or collect their payroll in the same way. In any case, the right thing to reflect on the "bank" of our life would be to ask: They want to live without money in the bank?
Maybe soon leave New Tribes called efectívoros "which dispense entirely banking services, but then I fear that will not reach too far.
When we read the news about the aid going to the banks, then we get their hands on your head thinking about why we give them, not to citizens. Unfortunately, banks are required in the world we live in, both for the development of trade and for the proper functioning of businesses and consumers What would an airline without a bank to make a loan or make the leasing of a plane? And a car factory that wanted to invest in new machines? And for us, that we should buy the car in cash?
As we see, this is a necessary evil and though some measures escuezan I fear that something must be done in order not to sink the boat in which we are, but let's see what other measures may have been in a crisis like this, for this move to cast a black and 7 years traveling back and a voice-over, alongside Droblo tells us ....
The 2001 S-11 accelerated the downward trend in interest rates and, as has happened recently with the bankruptcy of Lehman Brothers, persuaded the authorities of the magnitude of the crisis and the need for extraordinary measures. This not only caused a sharp drop in interest rates, also maintained over time in a measure that should have been exceptional and temporary. The positive effect of these low rates was that the money flowed more and revived the economy, more and more consumer spending and public finances (love it) lower interest payments. The negative was twofold: the rising price of many disparate assets (shares from the oil passing through the house or rice) and the need for many banks to use financial engineering to enhance the benefits already reduced the interest rates are low differentials and increasing the volumes of their speculation.
The consequences already know (summarizing a lot), many individuals, many companies and many banks (and many states, remember the huge U.S. deficits) are indebted in excess and the effect of globalization have infected all their problems.
The credit crisis has led to the extreme opposite: nobody wants to lend money to anyone and do not care if the rates are high or low. That is the main topic for discussion: How to overcome the crisis without funding the projects, without a capital to build a housing development or a company or to hire more people? If private banks are reluctant to do so, there is only one option: the state to extend liquidity to the company.
It is admirable the value of the USA, with its figures and macro jugándosela to fix this situation by committing the income of its citizens for years but to save some banks, they will get back to grant credits to citizens dare mortgaged for decades, that companies are betting on a revival in consumption and create jobs? I doubt greatly that this is the way to get money to the society.
Many analysts talk about this crisis in the past but I do not think confidence has returned and will return in time to what is the snake biting its tail: do not invest for fear of losses and investment losses are irremediable. And the states that means less income tax and VAT and indirect costs of social security ... I believe it is imperative to get liquidity to the company and I can think of only one way: drastically reducing taxes and thus assuming the Kingdom Spain, until he is returned via the more economic activity, the task of borrowing by its citizens. If the money goes to households that have consumed more effective and / or reduce our debts, but if, like USA, is intended to buy "pufos" of banks and savings, will only some few "save your ass."
PD. Contrary to what many believe the states and their governments are the first beneficiaries of low interest rates. No largest debtor in the world that the U.S. and certainly the biggest in Spain is the Kingdom of Spain. Hence the sterile political polemic PP-PSOE on the budget surplus or not because the money must be, What does it matter that a year accounts are positive? If I permitís a very castiza: this is the chocolate parrot. Here are the details:
Debt issued by the Spanish state totaled 303.618 million euros on March 31 this year to which were added to the autonomous regions, municipalities, or the railway RTVE (debt that is backed by the state) and so on. Roughly every way we can say that Spanish should be around 8,000 euros and pay interest each year, assuming an average rate of 5% of that debt, of about 400 euros.
Euribor 12 months at a lower therefore very beneficial for the states that emit almost every week new debt.
And complete stop, the usual summary of the press in a relatively quiet days:
Written by Carlos and Droblo on October 15, 2008 with 354 comments
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In Old Madrid when someone wanted to see what was happening in the rule had to go to any of the 3 mentideros who were in the capital since they were places where they often talked of the news even before they occur . There were even some specialization in them, and that was not the same gossip about where the king had stayed to try to know as has been the last battle of our glorious army. According to the "madripedia" these are the most important of the time.
Was the "palace" in the square in front of the Alcázar. They gathered a crowd, whose raison d'être was awaiting those who received, answered, raising the request or receive compensation or pension from the Crown, but it was mixed with all kinds of people, including vendors, and filibusters tricksters.
The most popular was the "Puerta del Sol", which were also the lenders and dealers, many who were at the steps of the convent of San Felipe el Real, a kind of high slice of the rest of the square, where a huddling unoccupied crowd of uncertain time of life and not recommended fearsome evil.
Finally, there was the "Mentidero of Representatives," in a square in the heart of writers, actors and yards, where it moved everything related to the world of Candilejas.
There were times in which they encountered the same people in several mentideros the same day, as you see the real professionals rumorología. As times change, now we mentideros the Internet blogs and forums as you are reading. With many backbiting and sometimes the questions are passed between them, as is the case then we bring.
Although this is not a Mentidero oriented investors, many watching the price of certain shares and rebounds yesterday as the temptations they can invest in stock market, hence the rumor pick (meme) from Especulación.org (and responded also Gurusblog) When asked to enter the market?. It responds Droblo us what he thinks, as always is only one opinion and not a recommendation, but I think it is worth knowing it passes someone's head has been on the market longer than us.
The capital investment decisions of each individual is something very personal. It's easy for someone who understands in a car buying advice to anyone but the decision to purchase the car should only depend on the buyer and its economic potential. I start from the premise bag: everyone knows who has the money and you can use for investment and each must decide whether the investment makes time or profitability is, if you thinking about buying 10 years view or get a 10% variables are different and the need to establish a peak of losses, too. This theme would be very long and I do not think is the reason for this article, and here it asks me "wet" and set in my opinion it would be a good time to invest in the stock market. And I understand that no quick or for speculation to build a possible year-end rally, "but as an investment in the medium-long term.
It is a truism, but the time to buy is when you have finished the bearish trend. Today is not over and despite strong downhill capitulation nor I noticed that often precede it (the days when lower values for which have a rising proportion of 9 to 1, for example). Each has its own arguments to make decisions and I think that the first should be the logic. This tells us that the economy is bad and will get worse. The following are my views of a mixture of other people with more information than I, statistics, technical analysis ... A system that this year has been very good result is a further study of Citibank says that the moments of panic and euphoria weekly. In the euphoria that there is panic selling and buying as sentiment contrary to the law works. Look at the chart if not updated on Friday:
In January, when it sparked panic bassist, came clear buy signal (below -0.30 and at the time it changes direction) and again at least March, warning recoveries. En mayo avisó de que las subidas eran demasiado eufóricas y veloces y de hecho volvimos a ver mínimos anuales en junio y julio. Y no ha vuelto a dar señal de compra, incluso ahora que ha entrado en señal negativa de nuevo.
Es absurdo fiarse de un solo instrumento para tomar una decisión, os he mostrado esta por su didactismo gráfico. Por otra parte, he leído un informe de Barclays Capital -de los pocos servicios de estudio de los que me fío de sus conclusiones, la mayoría son muy buenos por los datos pero suelen estar muy mediatizados) que defiende que estamos en una oportunidad histórica para toda una generación de comprar en bolsa. Sus argumentos también son buenos y se basan sobre todo en que los precios de las acciones -concretamente habla de Alemania y Reino Unido- están reflejando ya el valor en libros de las compañías. Ese razonamiento, si sus datos son correctos, es también bastante sólido.
Sin embargo, la experiencia demuestra que en los grandes movimientos bajistas -como en las alcistas- son más importantes las tendencias que los números. Y si hablamos de acciones, hablamos de empresas. Y si hablamos de empresas, hablamos de un empeoramiento de los resultados de éstas que se va a prolongar al menos durante varios meses (lo que hará que baje su valor en libros también) porque el consumo está muy afectado. Y en una crisis bursátil normal esto podría solucionarse con relativa rapidez y -como nos enseña la estadística- adelantarse el movimiento bursátil a las cifras macro unos 6 meses pero ahora tenemos también un “credit crunch”. Por mucho que el estado avale a los bancos privados la poca liquidez que tengan los bancos va a estar parada durante meses, no van a aumentar los créditos ni las inversiones aunque bajen los tipos de interés y las pequeñas empresas y los particulares dispondrán de poco acceso a dinero fresco para generar actividad económica.
El problema bancario corrompe las estadísticas que están manejando los que creen que lo peor ya ha pasado que dicen que de media el SP500 baja desde máximos un 30% en 450 días y esta vez ha bajado un 42% en 366 días. Y que animan a comprar teniendo en cuenta que de media dicho índice sube en el año siguiente un 36% desde esos mínimos. Esta crisis no creo sea comparable a ninguna y si lo es, debería compararse a de 1929 que duró varios años y en la que no existía el SP500. No parece muy coherente resaltar la unicidad de esta crisis -algo que han hecho desde ministros a analistas- en los peores momentos y ahora justificar su fin por una media…
Así pues, seguimos en tendencia bajista clara. Para entrar y salir es un mercado peligrosísimo pero si alguien se considera apto, le deseo lo mejor. También es posible que tras todo el interés mostrado por tantas autoridades mundiales en frenar el desplome bursátil sea posible ver un fuerte maquillaje al alza cara al fin de año (recordemos por ejemplo que el problema de los fondos de pensiones invertidos en renta variable en USA puede dejar en la miseria a muchos jubilados justo cuando se acerca la edad de retiro de los nacidos por el “baby boom” posterior a la Segunda Guerra Mundial). Fuera de ahí, no veo ninguna señal de cambio en dicha tendencia bajista y aún aceptando que quizás tengan razón los que opinan que hemos podido ver los mínimos del año, me temo no hemos visto los mínimos de dicha tendencia.
¿Cuándo hay que comprar pues? Pues como no soy profeta mi respuesta sólo puede ser: De momento, no. Si algún día cambio de opinión, podemos hasta especular sobre qué sectores lo podrán hacer mejor o incluso qué bolsas pueden ser más interesantes. Ahora me parece que no sería apropiado.
PD - -Y hablando de recomendaciones bursátiles, en la página web de Morgan Stanley hace un cálculo de sus recomendaciones bursátiles a 31 de agosto de este año claramente bajista:
| Coverage Universe | Investment Banking Clients (IBC) |
| Stock Rating Categoria | Count | % of Total | Count | % of Total IBC | % of Rating Category |
Sobreponderar/
Comprar | 892 | 41% | 299 | 45% | 34% |
| Mantener | 936 | 43% | 277 | 42% | 30% |
Infraponderar/
Vender | 367 | 17% | 87 | 13% | 24% |
| Total | 2,195 | | 663 | | |
Como se puede apreciar, sólo 2 de cada 10 recomendaciones son de venta a pesar de la claridad de la tendencia bajista . Es lo vergonzoso de estos bancos que a pesar de esto siguen moviendo mercado con sus recomendaciones….Ojo pues a fiarse de ciertas fuentes.
Y para terminar, el habitual resumen de prensa:
Escrito por Carlos y Droblo el 14 de Octubre de 2008 con 338 comentarios
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