Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Reply to @Sven: Oh yeah, the underlying problems are still there. The market just actually still believes the BS from politicians in Europe and elsewhere. I'm also guessing there were a fair amount of people short.
This Eurobsession is silly. Earlier in the week, Europe was falling apart, and the markets were down. Today, Europe is wonderful, so the markets are up. One day the media scares everyone to death about how Spain, Italy and others will implode. The next day, politicians tell us what we already know...that they will do just about anything to keep the euro "safe"...and the market goes on a tear. Stupid, but very predictable. And unless there is something of more importance happening, the Eurobsession will rule the day.
It's been said that the markets behave like kindergarden children...very up & down mood depending on what's going on at the moment. You could have kids crying one moment and then a moment later all happy licking an ice-cream or playing with a new toy.
Hi Bob- yes, what you say is certainly true, however there is no getting around the fact that the Euro either will or won't survive. What are your thoughts on keeping the powder dry until we get a clear indicator on that?
Lighten up on European equity exposure? Lighten up on European bond exposure? Keep a reasonable position in each and hope for the best?
Reply to @Old_Joe: We get a statement from the ECB today that whatever needed will be done to see that the Euro sticks together.
1. Do you believe they have the ability to be successful? If so, do you believe they will do anything really, beyond essentially figuring out various ways to debase the currency? How likely is it that they will really sit down and try to make difficult decisions on how to face the real, underlying problems that face the Euro-zone?
I would MUCH rather be in European equities than debt. I would far rather be in something that could opportunistically take advantage of Euro-area asset sales - I own Brookfield Asset Management (BAM), for example, which could potentially do so. Unfortunately, there aren't many "opportunistic" plays like that.
Another stick in the fire will be how much really gets done by anyone or any of the 1,000 or so committees that are in place as part of the fix programs................as the month of August for Europe, much of eastern Europe, also Russia; is pretty much shut the place down; except for anywhere a tourist may arrive. Many gov't., including court systems are closed for business in August. Not that the leaders, ECB folks and related won't be out of contact via cell phone or whatever; but many of the Euro leaders have or will start multi weeks vacation periods. Perhaps it is the best plan for any European with money to all go on vacation for 4 weeks. The only major Euroland leader without a defined vacation schedule is Spain's; and but he has a block of time set aside from Aug. 6-17.
An unrelated note: On June 21, New York Times: “For most Europeans, almost nothing is more prized than their four to six weeks of guaranteed annual vacation leave. But it was not clear just how sacrosanct that time off was until Thursday, when Europe’s highest court ruled that workers who happened to get sick on vacation were legally entitled to take another vacation.”
Hi Scott- Of course we don't pay any serious attention to political pronouncements, from whatever quarter. But the Euro either will or won't survive, and I'm trying to be in a position to handle that either way.
I'm a little surprised that not many board posters seem to have strong feelings on this, considering that one of the two outcomes is inevitable, and that a Euro breakup (it seems to me) might easily have worldwide repercussions similar to the disaster of 2007.
Thanks to your comments over the past months, I've got a pretty good idea of your perspective, and I'd also very interested to know how Bob is looking at this. We've got a little mixed overseas debt, and a bit more mixed overseas equity, both in various funds. Trust me, I'm watching both like a hawk.
In the meantime, there's opportunity in the potential to take profits when stupid stuff like today happens... take the money and run.
1) A contract (or work-rules) may provide for a certain number of vacation days, usually accumulated in some ratio to the number of days actually worked.
2) A contract (or work-rules) may also provide for a certain number of sick days, usually accumulated in some ratio to the number of days actually worked.
If one actually became sick during one's vacation, an employee could then substitute using sick-days instead of vacation days.
Reply to @Old_Joe: " In the meantime, there's opportunity in the potential to take profits when stupid stuff like today happens... take the money and run."
Yeah, I think I haven't felt more strongly about that in a while. In fact, I would definitely recommend to start moving back from any outsized risk and getting to a place where one can sleep at night. I don't think earnings have been all that tremendous, and there have been a few things that are concerning - Starbucks getting obliterated last night being the latest.
"I'm a little surprised that not many board posters seem to have strong feelings on this, considering that one of the two outcomes is inevitable, and that a Euro breakup (it seems to me) might easily have worldwide repercussions similar to the disaster of 2007."
My guess is that most of the board probably doesn't believe that there will be a Euro breakup. I won't speak for Bob, but his thoughts appear to be a couple of posts up.
Again, it's a matter of whether you believe the politicians will do anything to save the Euro (because in this day and age, whether the arithmetic of the Euro is sustainable or not doesn't matter.) Okay, what's the "anything" (s) that they will likely do. Will that create a sustainable, long-term recovery for the Euro zone, or is it just more "extend and pretend" that adds more to the eventual tab? Politicians today have one key task: figure out how to push problems down the road again and again. Eventually - and it can certainly be a lot further down the road than anyone expects - reality will have to be dealt with, and I have a feeling it may make 2008 look fun in comparison - and that could involve the eventual break-up of the Euro, despite all attempts to BS and bend reality to make it work.
Until then, people seem more than happy to believe that Europe will figure it out, when all that has come out of Europe for the last three years is rumors, confusion, BS and the occasional lie:
"he Eurozone, the amount of conflicting info was at an all time record, with glaring inconsistencies between various quoted authoritarians. Now, courtesy of the WSJ blog, we learn that, for the first time in history, a spokesman for Jean Claude Juncker, the PM of Luxembourg, and the head of the Eurogroup council of eurozone finance ministers, admits openly to having lied to media outlets. "In a phone call and text messages with two reporters for Dow Jones and the Wall Street Journal, Mr. Schuller repeatedly said no meeting would be held."
"So why the lie? “I was told to say there was no meeting,” said Mr. Schuller, reached by telephone Monday. “We had certain necessities to consider.” Necessities? Why yes: such as perpetuating the now open lie that is the ponzi market: "Evening in Europe is midday in the United States. “We had Wall Street open at that point in time,” Mr. Schuller said. The euro was falling on the Spiegel report, which had overhyped the meeting. “There was a very good reason to deny that the meeting was taking place.” It was, he said, “self-preservation.”"
if you really want something to worry about, consider a repeat of Bush v. Gore - or worse. Considering the rancor now in Washington, would be very concerned about that and the potentially devastating impact on economy & markets. CNBC ain't picked up on this yet - but what's new? They will in time. Gotta think the smart traders are already factoring it in. Call me skeptic, but think the "headline" stories we get re: Europe or many other things are rarely the full story. And so we try to avoid knee-jerk buying or selling. My guess is that U.S. markets are neither cheap, nor wildly overvalued. And, I'd keep her in a shoe box before lending Uncle Sam my $$ for 1.5% or whatever #*!!##.
Comments
This is an excellent chart by David Einhorn to reference whenever something is announced out of Europe:
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2012/05/Einhorn chart.jpg
Lastly:
http://www.bloomberg.com/news/2012-07-26/draghi-says-ecb-to-do-whatever-needed-as-yields-threaten-europe.html
And....CNBS alert just went by - Dow up 250 on Draghi's comments.
Lighten up on European equity exposure?
Lighten up on European bond exposure?
Keep a reasonable position in each and hope for the best?
Thanks- OJ
1. Do you believe they have the ability to be successful? If so, do you believe they will do anything really, beyond essentially figuring out various ways to debase the currency? How likely is it that they will really sit down and try to make difficult decisions on how to face the real, underlying problems that face the Euro-zone?
I would MUCH rather be in European equities than debt. I would far rather be in something that could opportunistically take advantage of Euro-area asset sales - I own Brookfield Asset Management (BAM), for example, which could potentially do so. Unfortunately, there aren't many "opportunistic" plays like that.
Not that the leaders, ECB folks and related won't be out of contact via cell phone or whatever; but many of the Euro leaders have or will start multi weeks vacation periods.
Perhaps it is the best plan for any European with money to all go on vacation for 4 weeks. The only major Euroland leader without a defined vacation schedule is Spain's; and but he has a block of time set aside from Aug. 6-17.
An unrelated note: On June 21, New York Times: “For most Europeans, almost nothing is more prized than their four to six weeks of guaranteed annual vacation leave. But it was not clear just how sacrosanct that time off was until Thursday, when Europe’s highest court ruled that workers who happened to get sick on vacation were legally entitled to take another vacation.”
I'm a little surprised that not many board posters seem to have strong feelings on this, considering that one of the two outcomes is inevitable, and that a Euro breakup (it seems to me) might easily have worldwide repercussions similar to the disaster of 2007.
Thanks to your comments over the past months, I've got a pretty good idea of your perspective, and I'd also very interested to know how Bob is looking at this. We've got a little mixed overseas debt, and a bit more mixed overseas equity, both in various funds. Trust me, I'm watching both like a hawk.
In the meantime, there's opportunity in the potential to take profits when stupid stuff like today happens... take the money and run.
Take care- and thanks again for your input.
OJ
1) A contract (or work-rules) may provide for a certain number of vacation days, usually accumulated in some ratio to the number of days actually worked.
2) A contract (or work-rules) may also provide for a certain number of sick days, usually accumulated in some ratio to the number of days actually worked.
If one actually became sick during one's vacation, an employee could then substitute using sick-days instead of vacation days.
In the meantime, there's opportunity in the potential to take profits when stupid stuff like today happens... take the money and run."
Yeah, I think I haven't felt more strongly about that in a while. In fact, I would definitely recommend to start moving back from any outsized risk and getting to a place where one can sleep at night. I don't think earnings have been all that tremendous, and there have been a few things that are concerning - Starbucks getting obliterated last night being the latest.
"I'm a little surprised that not many board posters seem to have strong feelings on this, considering that one of the two outcomes is inevitable, and that a Euro breakup (it seems to me) might easily have worldwide repercussions similar to the disaster of 2007."
My guess is that most of the board probably doesn't believe that there will be a Euro breakup. I won't speak for Bob, but his thoughts appear to be a couple of posts up.
Again, it's a matter of whether you believe the politicians will do anything to save the Euro (because in this day and age, whether the arithmetic of the Euro is sustainable or not doesn't matter.) Okay, what's the "anything" (s) that they will likely do. Will that create a sustainable, long-term recovery for the Euro zone, or is it just more "extend and pretend" that adds more to the eventual tab? Politicians today have one key task: figure out how to push problems down the road again and again. Eventually - and it can certainly be a lot further down the road than anyone expects - reality will have to be dealt with, and I have a feeling it may make 2008 look fun in comparison - and that could involve the eventual break-up of the Euro, despite all attempts to BS and bend reality to make it work.
Until then, people seem more than happy to believe that Europe will figure it out, when all that has come out of Europe for the last three years is rumors, confusion, BS and the occasional lie:
"he Eurozone, the amount of conflicting info was at an all time record, with glaring inconsistencies between various quoted authoritarians. Now, courtesy of the WSJ blog, we learn that, for the first time in history, a spokesman for Jean Claude Juncker, the PM of Luxembourg, and the head of the Eurogroup council of eurozone finance ministers, admits openly to having lied to media outlets. "In a phone call and text messages with two reporters for Dow Jones and the Wall Street Journal, Mr. Schuller repeatedly said no meeting would be held."
"So why the lie? “I was told to say there was no meeting,” said Mr. Schuller, reached by telephone Monday. “We had certain necessities to consider.” Necessities? Why yes: such as perpetuating the now open lie that is the ponzi market: "Evening in Europe is midday in the United States. “We had Wall Street open at that point in time,” Mr. Schuller said. The euro was falling on the Spiegel report, which had overhyped the meeting. “There was a very good reason to deny that the meeting was taking place.” It was, he said, “self-preservation.”"
http://blogs.wsj.com/brussels/2011/05/09/luxembourg-lies-on-secret-meeting/
There's also video on that page of PM Juncker discussing the merits of lying. “When it becomes serious, you have to lie.”
http://www.flickr.com/photos/expd/7657369000/
Whatever defined.
http://www.flixya.com/files-photo/w/u/l/wulandari389-2318775.jpg