Category: Your Money

Sunder’s List

Deutsch: Wappen Griechenlands seit 7. Juni 197...

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The only upbeat news comes from a technical analyst, Tom DeMark, who opines that the markets might rise 5% by the end of December and fall by the same amount in January. See our Indian market outlook here .

Bank runs, when people pull their deposits out of a bank out of fear, that started with Greek banks has now spread to French banks. French lenders lost €100bn in short-term deposits in September alone. In the meantime, risks of a slowdown in Asia grows. Recessions in the U.S. and Europe may cut emerging East Asia’s growth rate to about 5.4 percent in 2012. Brazil has already slowed down from 7.5% growth registered in 2010 to 2.1% in Q3 2011.

And what is Germany doing to prevent a spiral down the rabbit hole? Doling out more austerity. Look no further than Ireland to see how austerity can devastate a country.

I’ll leave you with three things:

  1. Always have a plan
  2. Don’t forget that the ultimate goal of investing and trading is to make money
  3. Learn from your mistakes and let it go

Sell in December and go away?

Seasonality affects stocks. It’s a fact that a number of pundits have tried to answer the ‘why?’ and the ‘how?’ of it. But first, lets look at the numbers in this handy chart:

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Now carefully look at December and January. Its almost a guaranty that the market melts up in December and goes down in January.

If you are in the market, enjoy the rally till Christmas and get out! If you are not getting paid to be a hero, then why try to be a superman?

In fact, it looks like you can stay out of the market till April, or maybe comeback only in July? Something to think about…

As to the “why” and the “how”? Well, the US markets enjoy a Santa Claus rally (most of the time) and it does have affect other markets. Also, portfolio managers looking to do some window dressing might be tempted to play high-beta emerging market stocks, so India might be benefiting from that. But who cares? With the global market teetering on the European experiment gone bad, why take changes? Book profits instead!

Sunder’s List

[DUTCHOUSE]

 

 

 

 

 

 

 

Going Dutch!

 

Cargill, the privately-owned company still controlled by the MacMillan and Cargill families, is turning bearish on global commodities, firing 2000 people. (FT)

The ruling Congress party appeared to have put on hold plans to open up the country’s $450 billion retail industry to foreign supermarkets. (ET)

No Eurobonds, ECB will not be a lender of last resort, automatic sanctions for breaching 3% deficit ceilings. (Telegraph) Probably buys them time till March next year. Also, the original Stability and Growth Pact, adopted when the euro zone was formed in 1997, had the 3% condition built into it. It fell into disuse after (you guessed it) Germany and France did not comply with it themselves!

Germany gets rules, everyone else gets the unenforceability to allow them to accept the rules.

Sunder’s List

It seems that the West is suffering from informed pessimism and the East from un-informed optimism. Meanwhile, the Euro saga rages on…

The Puritans want pain. Only suffering cleanses. (Telegraph)

India exports more than €40 billion of goods and services to the EU. (EC) What would European austerity entail? We are already seeing a slowdown in growth.

North African economies are closely tied with that of Europe. And guess where the bigs were headed earlier this year? And where do Indian banks get more than half of their funding?

Burying your head in the sand doesn’t make the problem go away…