USA vecka 25

Be Careful What You Wish For
by John Mauldin
6/15/2007

"The headache today is that China has too much reserves and the government is trying to find ways to encourage capital outflows. In the meantime, China has been a huge net creditor, and its foreign debt is minimal. There is no risk of a currency crisis in China by making the Yuan a freely traded currency."

...

The real question is can you credibly ignore rising food and energy inflation if you are a voting member of the Federal Reserve committee. I think not. And if China allows their currency to rise, that means we will be paying more for their goods, which is inflationary. It will also allow the countries that compete with them for the US market to allow their currencies to rise, which will mean inflation across the board for a lot of goods.

The prospect of rising interest rates and stubborn inflation, and a Fed that cannot credibly cut rates for a lot longer than the market thinks is very real. Senators, be careful for what you wish. We just may get it good and hard.

http://www.investorsinsight.com/thoughts_print.aspx

" When your hairdresser starts giving you stock tips, get out quick and wait..." mvh SPX 970

Global interest rates

The question is to what extent rising interest rates will impact negatively on economic growth. Many analysts and commentators wonder whether such an
upswing will for example be disastrous to share and property prices, while consumption and investment could also be hit by higher interest rates. A correction on the asset markets and/or a downturn in consumption and
investment would be negative to US growth, and the result would be that interest rates would begin to fall again. In as far as this will be the case it would also mean that a ceiling has been set for interest rates.
In our opinion, the current interest-rate surge will not be as influential when it comes to growth as many economists fear, for bond yields have not gone up because of mounting inflationary expectations, but due to higher growth expectations. This ?healthy? upswing of long-term interest rates
(based on a strong economic momentum, a tight labour market, and high global economic growth) does in our view for the time being not constitute an
impediment to US growth.

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" When your hairdresser starts giving you stock tips, get out quick and wait..." mvh SPX 970

Back to Normal

Now, for whatever reason, this anomaly looks to be ``normalizing'' -- although, as Timothy Geithner, president of the Federal Reserve Bank of New York, observed this week, ``It's hard to know what normal is in a world that's changed so much.''

http://www.bloomberg.com/apps/news?pid=20601039&sid=avZuivzxHHzc&refer=home

" When your hairdresser starts giving you stock tips, get out quick and wait..." mvh SPX 970

Imorgon börjar min långa semester och kommer tyvärr inte att kunna vara aktiv förrän den 10 augusti...Förhoppnigsvis kommer jag att då och då besöka forumet för att inte tappa tråden...

Önskar alla en trevlig sommar:-))

Wall Street Analysts More Bearish Than Ever; More Accurate, Too

June 18 (Bloomberg) -- Never in the history of Wall Street have analysts been so bearish. The good news is they're also getting it right more often, helping make investors richer by betting against corporate America.

...

Generally Not Right'

``Analysts are generally not right,'' said Wien, who left Morgan Stanley in 2005 after 20 years with the firm. ``That's the sad irony of this business. When everybody's on the positive side, it's usually a time of danger. When everybody says `hold,' it's probably time to take a hard look.''

http://www.bloomberg.com/apps/news?pid=20601087&sid=aj9Stdj50pUo&refer=home

" When your hairdresser starts giving you stock tips, get out quick and wait..." mvh SPX 970

Home builders' confidence falls to 16-year low
Contractors say market probably won't improve until next year

All three components of the housing index fell in June. The index for single-family home sales dropped from 31 to 29, also the lowest since 1991. The index for expected sales fell by two points to 39, the lowest since September. The index for buyers' traffic dropped by one point to 21, the lowest since January 1991.
"The bottom of the housing market appears nowhere in sight," wrote Patrick McPherron, an economist for Moody's Economy.com, in an analytic note.

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B44171FF5%2D1FA7%2D4E66%2D8B0A%2DC8B96EF44F75%7D&siteid=mktw

" When your hairdresser starts giving you stock tips, get out quick and wait..." mvh SPX 970