Friday Fund Fun?, Market Switch Flip at 10:45pm .....LIP

catch22

Hmmmmm.....10:45pm, EST, Thursday evening. U.S. major indexes moved from slightly down to +1%, dollar down 1.2% and Euro up 1.3% within 5 minutes time. That is a lot of cash, folks. Asia is awake and trading, Europe and America traders mostly at the pillow. Must be an excellent rumor traveling; or the machines have finally taken control.

Market Switch Flip at 10:45pm, EST

Friday may be a most fun day to observe.

scott

This:
http://www.zerohedge.com/news/full-eu-summit-statement-all-its-conditional-wishy-washy-glory

This is a very, very technical chart that leads the reader through the European situation. It's a superb, in-depth look at the real, underlying details.

http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2012/01/Einhorn chart.jpg

Jim Rogers: "Rogers says the market euphoria brought on by the news, which saw a surge in Asian stocks, the euro and risk assets like oil, will not last.
"How many times have this happened in the last three years - they have had a meeting they have made an announcement, the market have rallied, two days later the market say wait a minute this doesn't solve the problem," he said."
http://finance.yahoo.com/news/financial-armageddon-happen-despite-eu-061542925.html

catch22

Morn'in Scott,
Thank you for the linked article. I watched the move late last night, but did not find or see any related story and had to hit the pillow. Surely didn't expect the 19th or is it the 20th EU summit to be awake and holding a press conference at 3am Euro Time.
Some traders have and others will gather some great profits trading the ups and downs of some markets over the next week or so; however, the root cause of the tooth ache is not gone and the topical application of the numbing agent is only temporary.
Past what would appear to be a leaning negative towards the markets, which may be the case for a longer period of time; I really do prefer a bunch of stability, as the longer this situation travels down the road, the more regular folks on the planet will continue to be financially and emotionally damaged. The big and rich cats may scream over losing a million(s) in their personal financial accounts since April; but will have enough remaining to choose any dinner meal on the menu at the local 5 star feeding station.

Some of our bond funds may get a clip today; but not motivated to sell any.

Take care,
Catch

BobC

Just about a year ago, I spent a day at Ivy Funds in Kansas City. It started with their daily morning meeting where the CEO hears from every analyst and portfolio manager who is in the office. They go around the room, starting with the same person each day. This person gives a quick overview of overnight markets, trends, etc. Then it moves to other analysts (who line the walls of the large conference room), each of whom may be called on to discuss their particular area of expertise (or even an individual stock). And these folks better be prepared and be able to back up their comments. The meeting was a fascinating look at the truly integrated process Ivy uses for its funds. But one of the takeaways was the comment from the European economic person, who said, in essence, "The European sovereign debt issue will take years to solve, not months." So here we are, one year later, having gone through a weekly (if not daily) Eurobsession, with commentators foaming at the mouth when the very complicated problem is not fixed in a week's or month's time. This will eventually work itself out. Countries may or may not default, may or may not leave the euro currency, may or may not leave the economic union. Central banks will do what they have to do, within reason, just as they always have. But eventually, in a few years, this will pretty much be resolved. In the meantime, the media will continue their daily barrage of euro-this and euro-that. It's darned hard to ignore, and it certainly causes volatility to hang around. But, if it wasn't this euro issue, it would be something else, don't you think? I mean, that's how the media work...one crisis to the next. Investors need to maintain their long-term goals, establish an allocation that lets them sleep at night, and turn off the freaking TV. We can look back 1 year ago, and not much has changed in terms of headline news. That's partly because there is very little "news". It's mostly re-packaged, regurgitated pablum.

scott

Reply to @BobC: Thanks for the terrific post - interesting story on your experience at Ivy.

I think it will be resolved (it will take years) but it is a matter of how it is resolved.

" But, if it wasn't this euro issue, it would be something else, don't you think? "

Well, yeah, there are a lot of other things.

"In the meantime, the media will continue their daily barrage of euro-this and euro-that. It's darned hard to ignore,"

Well, some people are - CNBC's ratings are the lowest in near a decade.

"That's partly because there is very little "news""

It's also because you have countries operating with "Groundhog Day" finance - string short-term solutions together and be somehow surprised when the problem keeps coming back every 6-12 months because it was never truly solved in the first place.

As for "years" and Europe, Jacob Rothschild said the same thing in his investment letter recently.

"The Western world may have finally woken up last
year: it realised that the crash of 2008 was not just
another market event, quickly to be recovered from.

Peoples, electors and governments in America and
Europe at last began to see that they had experienced
not just one more asset bubble pricked by reality.

This time, outside Asia, South America and Africa,
there can be no quick re-explosion of growth. The
debt mountain in government and households is just
too high. The legacy of debt has first to be worked off.
And that – people and markets now see – will take
years. Recovery may come, but not in months. There
are signs now that the impact from the loss of
Western spending power has started to affect China
too. In this reality, markets oscillate as before. But the
ups do not last. And they are succeeded by falls.

Unless one has a long horizon, investment success in
public markets has become a game of timing rather
than fundamentals."