Stay the course

Tuesday, November 21, 2017 Francisco Carneiro 0 Comments

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Stop the Yield Curve Panic-Mongering. It's a Bullish Indicator


By Mark Cudmore
(Bloomberg) -- 
Okay, I'm getting really frustrated when I hear some of the commentary on the yield curve.

The fact is, a flattening 2s-10s curve is generally a positive indicator for the economy and for equities.

The research shows:
  • An inverted U.S. yield curve is normally a precursor to a recession.
  • However, during the last 30 years, it has taken at least a year, and an average of 18 months, after the initial inversion before the recession set in. The economy actually kept growing as the curve narrowed.
  • And, importantly, the U.S. yield curve still has a long way to go before it inverts.
  • During the last 30 years, a recession has come only after the curve starts steepening again post-inversion.
  • The related S&P 500 peaks came an average of 13 months after the curve first inverted.

yesterday the market trow us another all time high on the DOW, S&P etc... i guess we will see more until the Tax relieve is approved . when that happens we could have a sell on the news event. Until that i think it's totally green light.

But even after that correction we are in a Bull market in everything except value. That will come back.


From EVA Capital Management presentation


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It takes some time for Communism to work it's magic!

Tuesday, November 21, 2017 Francisco Carneiro 0 Comments

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But it's s sure result!

BROKE

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i wouldn't bet on commodities yet

Monday, November 20, 2017 Francisco Carneiro 0 Comments

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there is a reason for commodities to be getting cheaper for centuries

 technology makes it easy to extract more and technology makes more with less

 there is only one reason for commodities to go up! more people with money in the planet but i think technology will prevail.



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The Swiss are making a killing!

Sunday, November 19, 2017 Francisco Carneiro 0 Comments

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The swiss (Swiss national Bank) are making a huge profit. Good for them.


From The Great Gartman letter. We have written many times about the fact... and it is a fact... that the Swiss National Bank has effectively become both the nation’s central bank and one of the largest, if not indeed the very largest, hedge funds in the world. The process began several years ago when the SNB swore that it would do what it could and using what methods were available to it to weaken the Swiss franc relative to the EUR and to the US dollar. It has succeeded, until recently, creating Swiss francs out of the thinnest of air, and selling those Francs vs. the EUR and the dollar, and then taking those EURs and dollars to buy European and US equities and debt securities. The SNB’s balance sheet is a CHf 813 billion (and given that the CHf and the US dollar are effectively at parity one with the other that CHf 813 billion is the same as $813 billion) and this is very nearly 125% of the Swiss GDP.

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It's not cholesterol

Friday, November 17, 2017 Francisco Carneiro 0 Comments

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it looks like some doctors were wrong! It's not fat or cholesterol the origin of heart disease!

 perhaps sugar or cigarette


Resultado de imagem para all heart disease cigarette
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Why EM never emerge!

Thursday, November 16, 2017 Francisco Carneiro 0 Comments

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why do we have Emerging markets crisis from time to time

 1.Because EM are not catching up with DM. That is the reality
2.Globalization makes people from EM desire what we have in DM not the opposite
3.Automation is not friendly to EM
4.The best minds in EM don't stay in their countries
5.The cancer treatment is not going to be invented in any EM country

 Except Singapore and perhaps Korea no Emerging market ever emerged

 Turkey is running a chunky current account deficit of about US$40bn a year, and has a large external debt of about US$400bn on a gross basis and US$200bn on a net basis (about 50% of GDP).

GaveKal


Looking at The Economist Indicators i see a crisis coming soon.

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Where you live matters

Tuesday, November 14, 2017 Francisco Carneiro 0 Comments

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Lately Globalization brings two trends

 1.Poor countries continue to catch up to the rich countries but slowly. The only country that transitioned from poor to rich is Singapore. Perhaps Korea & Japan are also amazing transitions.

 2.Regional inequality withing rich countries increased.
An example Silicon valley is pulling apart from the rest of America. Companies tend to cluster (Detroit) and when one industry gets in trouble one region suffers. In the past people moved from the declining region to the land of opportunity. Not anymore because social security and government subsidies can make people stay in dying regions.  


Divergence is the result of big forces. In the modern economy scale is increasingly important. The companies with the biggest hoards of data can train their machines most effectively; the social network that everyone else is on is most attractive to new users; the stock exchange with the deepest pool of investors is best for raising capital. These returns to scale create fewer, superstar firms clustered in fewer, superstar places. Everywhere else is left behind.


The Economist





Resultado de imagem para the economist the rich get richer
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People are becoming less mobile

Tuesday, November 14, 2017 Francisco Carneiro 0 Comments

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From the Economist

 Perversely, policies to help the poor unintentionally exacerbate the plight of left-behind places. Unemployment and health benefits enable the least employable people to survive in struggling places when once they would have had no choice but to move. Welfare makes capitalism less brutal for individuals, but it perpetuates the problems where they live.
https://www.economist.com/news/leaders/21730412-time-fresh-thinking-about-changing-economics-geography-right-way-help-declining
also from the same article of The Ecomonist
The pension of a teacher who stays in the same state could be twice as big as that of a teacher who moves mid-career.



I noticed that people move less & less the system is designed to discourage people to move to the land of opportunity. Only the retirees that have their pension set in stone can move freely.
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Trade = specialization = do more, better & cheaper

Thursday, November 09, 2017 Francisco Carneiro 0 Comments

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It is precisely because there is so much poverty, hunger and illness that the world must be very careful not to get in the way of the things that have bettered so many lives already – the tools of trade, technology and trust, of specialization and exchange.

Matt Ridley

PS yes as long as trade is free the world will do well. Don’t interrupt what is working for 200 years. Don’t mess just because despite everybody is getting better a minority is doing even better (. That is the way it is. To close commerce and free trade we lose specialization and to do a bit of everything = poverty.



Adam Smith pointed out that there were three things that make us more prosperous, in a general sort of way: freedom to pursue our own self-interest; specialization, which he called division of labor; and freedom of trade. P. J. O'Rourke


“The ideal of an “all-round” education is out of date; it has been destroyed by the progress of knowledge.”
― Bertrand Russell, Sceptical Essays
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Some quotes i like

Wednesday, November 08, 2017 Francisco Carneiro 0 Comments

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If you panic at all panic fast
Aaron Cohen

When you relinquish the desire to control your future, you can have more happiness.

Nicole Kidman, in The Scotsman  

“First, we seem to assume that if a lot of people are doing the same thing, they must know something we don’t.”
― Robert B. Cialdini, Influence: The Psychology of Persuasion


"Happiness is a reward – it is a consequence."
Robert Green Ingersoll


When people think the world of you, be careful with them.
Margaret Cho, Margaret Cho Blog, 09-26-05  


I am always doing that which I can not do, in order that I may learn how to do it.
Pablo Picasso (1881 - 1973)


"Never be afraid to sit awhile and think."
Lorraine Hansberry


“Toda a grande obra supõe um sacrifício; e no próprio sacrifício se encontra a mais bela e a mais valiosa das recompensas.”
Agostinho da Silva
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The FED is in trouble

Wednesday, November 08, 2017 Francisco Carneiro 0 Comments

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The FED has not much room to raise rates anymore! They don't want a flat curve for sure!



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Everything in one Graph

Friday, November 03, 2017 Francisco Carneiro 0 Comments

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Resultado de imagem para manufacturing is increasing - but manufacturing jobs are not
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