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Toto deVeer

Euro: From Deutsche Mark To Italian Lira

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This from John Taylor of FX Concepts, a firm with 14 billion of assets that is up 14% this year...

Courtesy of Zerohedge:

The Eurozone has begun its collapse a little later than we thought. My compliments to the political prowess of the euro-leaders for holding things together for so long, but this is an impossible situation and the crisis is on its way. Jean-Claude Trichet caught the spirit of the situation today in Seoul when he said that “it is absolutely necessary to change the governance of Europe” and called for moving “as far as possible in the direction of an economic and budgetary quasi-federation.” I only disagree with part of one word, ‘quasi,‘ as Europe must move to a full economic federation if the euro is to survive. With 16 countries using the euro and Estonia on the way, the odds of moving there is currently lower than infinitesimal. Things will change after the approaching horrible economic and political catastrophes that will wrack some of these economies and societies. Unfortunately nothing will happen before the current situation gets unbearable – this is the way of democratic politics. As all the leaders are still working toward the same goals, and no one has stepped forward express the inchoate fears of the European populace, this should take years. By the start of next year the Eurozone will enter a recession that will test the current leadership. The euro, which has been perceived as if it were a German mark, has already topped and will decline until it is priced like an Italian lira in the next few months. With Europe and the US in recession next year, commodity prices will drop again and global growth will suffer despite the outperformance of domestic Asian economies. With the policy stresses, and the risk of significant errors in judgment, international strife becomes more likely as well.

This seems, in some respects, quite at odds with Jeremy Grantham's expectations, although Grantham does agree that the dollar is quite undervalued on a purchasing power basis.

It will be interesting to see how this plays out...

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Dollar gains as world leaders grapple with trade tensions; Irish debt problems weigh on euro
.
Topics:International.On Thursday November 11, 2010, 12:11 pm EST
NEW YORK (
AP
) -- Investors turned to the safe-haven dollar Thursday as world leaders, sharply divided on how to address big trade deficits and surpluses, began gathering in South Korea.
Fears that Ireland, like Greece back in May, would need a huge bailout from other European countries weighed heavily on the euro, which dropped to a six-week low. Ireland is one of the 16 European countries that use the common currency.

The EZ's carpet sweeping exercise did not prevent the poisons from hatching out. Just made it worse IMO.

Big shake up on the way--exciting times ahead and no more boring listless days on HPC.co.uk. :D

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Open your eyes and look through all this, it's so obvious.

It's the speculators driving the currencies up and down for their gain.

Just look at the EUR/USD graph to see what I mean:

http://finviz.com/fo...?t=EURUSD&tf=w1

Nice neat ups and downs, a speculator's dream to make loadsa money.

The doom and gloom is only VI spam to drive the markets where they want them to go, earlier this year it was about driving the Euro down, once that ran out of steam they spread doom about the dollar again, and now it's time to drive the Euro down again.

Edited by wise_eagle

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Open your eyes and look through all this, it's so obvious.

It's the speculators driving the currencies up and down for their gain.

Just look at the EUR/USD graph to see what I mean:

http://finviz.com/fo...?t=EURUSD&tf=w1

Nice neat ups and downs, a speculator's dream to make loadsa money.

The doom and gloom is only VI spam to drive the markets where they want them to go, earlier this year it was about driving the Euro down, once that ran out of steam they spread doom about the dollar again, and now it's time to drive the Euro down again.

Although Taylor is predicting parity next year...

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Although Taylor is predicting parity next year...

Sure it's all part of the game to drive the markets the way they want them to go to make a mint.

BTW, if you can't beat them join them, this year making money off the EUR/USD has been easier than stealing a cookie from a toddler.

Edited by wise_eagle

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Sure it's all part of the game to drive the markets the way they want them to go to make a mint.

BTW, if you can't beat them join them, this year making money off the EUR/USD has been easier than stealing a cookie from a toddler.

At some point the EUR/USD cycle is going to break, no?

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Who knows? If market patterns were always so predictable, we'd all be rich. But that's not the case...

They are not necessarily predictable for everyone, but rather driven by the dominant players.

And most people don't have the right mindset to see the game behind all this and therefore take advantage of it.

Maybe a bond crisis of some sort. Germany pulling the plug...

Sure, and maybe an asteroid will hit the earth, that could mess up the FX markets too...

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Who knows? If market patterns were always so predictable, we'd all be rich. But that's not the case...

Maybe a bond crisis of some sort. Germany pulling the plug...

Nah, they'd all be arbitraged away and no one would profit. Kind of like the January effect in small stocks in the US.

Actually that one may still exist.

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Sure it's all part of the game to drive the markets the way they want them to go to make a mint.

BTW, if you can't beat them join them, this year making money off the EUR/USD has been easier than stealing a cookie from a toddler.

Course it is, I watch the £ v € daily and you do get the distinct impression that they ramp one at the same time as they stick it to the other, always seems just a bit too coincidental, don't have any official Government news?, no problem just get a "financial expert" to offer their opinion.

Edited by madpenguin

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They are not necessarily predictable for everyone, but rather driven by the dominant players.

And most people don't have the right mindset to see the game behind all this and therefore take advantage of it.

Sure, and maybe an asteroid will hit the earth, that could mess up the FX markets too...

We've been down this road before, but do you think the Euro will survive in it's current form?

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"Headquartered in New York City, FX Concepts is an independent absolute return manager specializing in systematic investment strategies in currencies, fixed income, and commodities. Since 1988, FX Concepts has managed currencies for institutional investors through both overlay and absolute return strategies. "

Offices in New York, London, Sydney and Singapore

Really got their finger on the pulse within Europe then haven't they?

http://www.businessweek.com/news/2010-10-25/pound-set-for-pain-as-cuts-push-king-to-print-money.html

"The U.K.’s spending cuts are “insane” and the pound will slump to below $1.40 as early as this year, John Taylor, chief executive officer of FX Concepts Inc., told the Telegraph newspaper."

http://www.businessweek.com/news/2010-11-11/weak-dollar-may-help-u-s-trade-gap-fx-concepts-taylor-says.html

"The U.S. is correct in pursuing a weak-dollar policy because of the need to fix the nation’s trade deficit, according to John Taylor, founder of FX Concepts LLC, the world’s biggest foreign-exchange hedge fund."

http://www.fbs.com/analytics/news_markets/view/4183

John Taylor, the head of FX Concepts LLC in New York managing $9 billion assets, advised to buy Aussie now and sell it after a month in favor of some other currency, possibly, US dollar.

Wish I had this guy's crystal ball, he knows everything!

Edited by madpenguin

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What I heard Grantham say was that QE may well drive up the markets and commodities for another year but that all were at risk of a sudden collapse... so you basically takes your chance but that it is high risk... so he seemed to be favouring staying in cash... the little you lose on inflation being preferable to losing much more in commodities/equities.

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What I heard Grantham say was that QE may well drive up the markets and commodities for another year but that all were at risk of a sudden collapse... so you basically takes your chance but that it is high risk... so he seemed to be favouring staying in cash... the little you lose on inflation being preferable to losing much more in commodities/equities.

I watched the Grantham interview and I'm sure that you noticed that he really carefully hedged every prediction, basically the major prediction was that if you were to invest in agricultural or forestry then in 20 years you were assured a good return.

Same with Faber. The press is always trying to push them into a prediction. The art seems to be the ability to sound like an Oracle without actually saying anything specific.

Taylor has been predicting dollar parity for some time, but he reckons that Bernanke has delayed the process. He's 14% up on the year on $14 billion of FX so that's not bad.

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"Headquartered in New York City, FX Concepts is an independent absolute return manager specializing in systematic investment strategies in currencies, fixed income, and commodities. Since 1988, FX Concepts has managed currencies for institutional investors through both overlay and absolute return strategies. "

Offices in New York, London, Sydney and Singapore

Really got their finger on the pulse within Europe then haven't they?

http://www.businessw...rint-money.html

"The U.K.'s spending cuts are "insane" and the pound will slump to below $1.40 as early as this year, John Taylor, chief executive officer of FX Concepts Inc., told the Telegraph newspaper."

http://www.businessw...aylor-says.html

"The U.S. is correct in pursuing a weak-dollar policy because of the need to fix the nation's trade deficit, according to John Taylor, founder of FX Concepts LLC, the world's biggest foreign-exchange hedge fund."

http://www.fbs.com/a...rkets/view/4183

John Taylor, the head of FX Concepts LLC in New York managing $9 billion assets, advised to buy Aussie now and sell it after a month in favor of some other currency, possibly, US dollar.

Wish I had this guy's crystal ball, he knows everything!

Many thanks, your research confirmed my point that this is just a VI (a speculator) pushing his interests.

He doesn't care about his predictions being right, all he cares about is pushing the market in the direction he wants, enough to make a profit for him.

Classic PUMP AND DUMP applied to currencies.

Edited by wise_eagle

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Big shake up on the way--exciting times ahead and no more boring listless days on HPC.co.uk. :D

Honestly RB, we try to provide endless stimulation on here.

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  • 142 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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