Tuesday, July 12, 2011

Take cover – it’s going to blow…

Stock markets fall on fears eurozone debts may spread

The market begins to realise that Europe is insolvent.

Posted by doom&gloom @ 01:27 PM (2181 views)
Please complete the required fields.



10 thoughts on “Take cover – it’s going to blow…

  • Sorry – typo.

    It’s a matter of time before this blows – the end of the world in nigh. The emperor has no clothes.

    “in a sign that investors remain more risk-averse to Italy, the yield on Italian 10-year bonds on Tuesday increased to 5.9% from 5.6% on Monday. Meanwhile, yields on 10-year bonds issued by the Spanish government rose to 6.3%, from 6.1%. Analysts say both these yields are now close to levels at which the two countries will have problems servicing their debts.”

    Reply
    Please complete the required fields.



  • general congreve says:

    Despite the grey skies this morning, I feel absolutely elated today.

    Reply
    Please complete the required fields.



  • Meanwhile the FTSE is down 0.81%, just intra-week noise.

    Reply
    Please complete the required fields.



  • The markets always react very badly to any element of uncertainty. If I’m reading my tea-leaves correctly, this is the precursor to the realisation that sovereign debt across the developed world has not only been underpriced in terms of real yield, but also underpriced in terms of risk.

    This might give rise to the following market factors:

    1) Non-domestic investors of stocks and bonds in unsound economies (the PIIGS, possibly Belgium, and possibly Japan) take fright and offload.

    2) Domestic investors in those economies move their investments to safer havens.

    3) Consequently, the bourses in those countries take a beating.

    4) Investors in bonds, however, start switching to equities, and this may soften the equity market falls in those countries.

    5) IF the US stops squabbling and agrees a sane budget strategy, there could be major rise in the price of US stocks.

    6) If the UK coalition holds firm, while the US keeps on bickering, the FTSE (and sterling) might become everyone’s darling.

    7) Gold might surge again, but know your sell price, and be ready to offload.

    Reply
    Please complete the required fields.



  • @UT
    It won’t spike, but stay high till things get resolved. My tea leaves are starting to say “PANIC”.

    Gold to peak in $ in the next few days if no resolution. (my opinion is that the US$, the GB£ and the Euro all face severe problems – maybe China, too).

    OK – Gold at $1600 by Friday at this rate…. What’s the General’s prediction?

    Reply
    Please complete the required fields.



  • @6 Dont forget golds poorer cousin…..$40-$45 by friday and as for the yellow stuff $1650-$1700

    Reply
    Please complete the required fields.



  • Along with other asset classes – equities have been pumped higher via QE.

    As bad debts and potential bad debts are understood, there will be less liquidity (cash) and prices will fall because of that. And they will fall again with the loss of confidence. It may be a smallish correction or it may grab momentum, as per Alans’ tea leaves.

    AFAICS gold may blip as a “risk off” reaction; however then the lack of liquidity may mean the speculative element goes no further and things could correct. If there is a similar pattern to 2008 then there could be a fall in the gold price that correlates with equity indices.

    Having been a gold bug; I was quite shocked to realise that the trip from $35 (circa 1970) to $800 (circa 1980) involved a major fall back in the mid 1970’s. Believing that the gold bull market is yet to peak does not excuse a lack of attention to one’s stop loss levels and so forth.

    Reply
    Please complete the required fields.



  • sureseam. I disagree with your analysis. QE is the only trick they have left – deflating historic debt. As the crisis increases, there will be more liquidity, not less, as central bankers print money to wipe out historic debt. Same as it ever was. You don’t want to be long cash in a market where they are running the money presses 24/7.

    Reply
    Please complete the required fields.



  • @6 Gold at $1600/oz should mean £1000/oz if the FX rate doesn’t change much ……..<{drools}>

    Reply
    Please complete the required fields.



Add a comment

  • Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
  • Please note that any viewpoints published here as comments are user´s views and not the views of HousePriceCrash.co.uk.
  • Please adhere to the Guidelines

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>