Wednesday, Jan 21, 2009
Go on, treat yourself to some gilts
Bloomberg News: Goldman Sachs Says ‘Stick to Guns,’ Bet Pound to Rise
Investors should keep betting the British pound and gilts will rise because the country’s economic slump is being overplayed, according to Goldman Sachs Group Inc.
Posted by soros @ 05:52 PM (768 views) Add Comment
10 Comments
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1. bystander said...
I find myself agreeing with Goldman Sachs, this is a market fueled by fear and rumour, ultimately driven by greed. Nothing changes. (Although it was Goldman who bet oil would top out at $250/barrel, so perhaps they have gone long sterling and are trying to claw something back). Lies, damn lies and statistics.
2. d'oh said...
I'm in two minds. On the one hand, I agree that the rest of the world is screwed too and the UK situation is being overplayed. Europe, Asia and the antipodes are quickly catching up. On the other hand, when Goldman Sachs makes announcements like this in public, I normally run the other way.
3. japanese uncle said...
I seem to remember this stinking institution was rigging the oil market predicting 200 dollar a barrel. Exact opposite to what GS says may be a right strategy. But this scheming/corrupt organization may have even taken such contrarian move into account.
4. charlie brooker said...
@bystander
I like your car analogy, but does anyone know where the brake is? Does anyone know the way? Why didn't the driver read the road signs?
Ah . . . now I see why: its because greed is blind.
5. New User 2007 said...
Yes, and I will sell a barrel of oil for US$200 if anyone wants it?:)
6. new user 2007 said...
Yes, and I will sell a barrel of oil for US$200 if anyone wants it:)
7. Crunchy said...
It's very simple, Oil is cheap now.
Which part of that comment do people not understand.
Some things are so obvious.
OK it has not happened yet, but is that not what investing is all about.
YOU BUY, WAIT AND RELAX.
8. fjcruiser said...
GS is probably busy selling the £ wihile posting the opposite.Do people really listen to these bozzos ?
9. mark wadsworth said...
There must come a stage where sterling is oversold/undervalued (if we are not already past that stage) - however bad our news is, it is going to get worse everywhere else as well, JPY is ridiculously overvalued and their output and exports are plummeting - the Chinese currency is pegged to the USD at about 7, and was very undervalued for a long time, their output and exports are plummeting as well. The Eurozone is falling apart, USA, ANZ had the same credit/property price bubble as we did, and so on.
But as others above point out, don't trust what these banks any further than you can throw them.
10. japanese uncle said...
mark w:
Japan's economy has been riddled with deflation for the past decade while UK economy has been under 3%+ inflation all the time (could be 5%+ incorporating house prices). Yet JPY has not appreciated against GBP thanks to the massive carry trade. Current JPY appreciation is just the due (or overdue) adjustment which is perfectly logical. I can even envisage GBP=95 yen overshoot. Long term equilibrium, however should be somewhere between 120 and 130.