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Sail-World.com : Collinson FX Market Commentary: October 24, 2013 - Equities retreat
Collinson FX Market Commentary: October 24, 2013 - Equities retreat


'San Francisco - 18ft International - Day 3, 11 September 2013'    Richard Gladwell ©    Click Here to view large photo

Collinson FX market Commentary: October 24, 2013

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The record levels achieved by equity markets retraced overnight, fueled by perceptions of a continuance of Fed intervention. The economy is yet to recover and high expectations on the corporate earnings front are failing to materialise.

The Dollar regained some ground with the EUR slipping back to 1.3780 and the GBP 1.6179. Risk appetite and confidence took a breather and the AUD dipped to 0.9600, with the KIWI falling over a 'big figure', to 0.8375. The flood of liquidity will continue to build the equity bubble and destroy the Dollar until confidence in the US is lost. That day is fast approaching and the gauge is the bond market.

The 10 year bond remains low and thus short term rallies can be expected but when we see interest rates spiking then their is a problem. Commodities also slipped back, with the rise in the reserve currency, although October is yet to see the historical crash in equities!?

CTECH - San Francisco - 18ft International - Day 3, 11 September 2013 -  Richard Gladwell_©   Click Here to view large photo

Collinson FX market Commentary: October 23, 2013

The long awaited, and much delayed, Non-Farm Payrolls came in lower than expected and Unemployment fell to 7.2%.

This is relatively good news and would ordinarily suggest an improvement in economic conditions. This would suggest a tapering of the QE Infinity policy that the Fed have been foisting upon the US and the Globe. The Fed has siezed upon the recent US Government shutdown as an excuse to extend Monetary expansionism, without fail. Bernanke seems intent on expanding the Feds balance sheet beyond all comprehension and without an avenue of return to normalcy. This will certainly continue under the leadership of dovish, democrat... Yellen!

The great leap forward, harks back to Sino/Russian command/control plans for the economy and is working out well for the Obama regime. The rollout of Government controlled Health Care is going swimmingly, and is a huge pin-up poster for more, big Government.

The message has been sent and the Dollar crashing, with the EUR hitting 1.3800 and the GBP to 1.6250! The demise of the USD is a direct result of the Fed's monetary policy and is destroying wealth in the USA.

This is modern economic and monetary socialism in action and because the reserve currency is being undermined other Central Banks must follow, suggesting capital flow in to hard assets.

Commodities will reflect this move and is translated in to the associated currencies with the AUD moving to 0.9700 and the KIWI 0.8515. This is purely a reflection of the dire state of the Dollar and certainly not a symptom of healthy local economic conditions. Currency wars resume!

San Francisco - 18ft International - Day 3, 11 September 2013 -  Richard Gladwell_©   Click Here to view large photo

Collinson FX market Commentary: October 22, 2013

The drama of the last couple of weeks has played out and left the markets exhausted. The only economic data released overnight in the US, was Existing Homes Sales, which declined 1.9% and set off a decline in Home Builders.

The September Jobs Report is due out tonight, after delays due to the Government shutdown. The Government shutdown and the Debt Ceiling crises has empowered the Fed with a further reason to resist the reduction of their boundless expansion of the money supply. The QE Infinity has been a snowball on a steep decline with $85 Billion being added to liquidity every month. It now appears unlikely that Bernanke will attempt to commence the taper, which will result in a dim view of his reign historically.

His successor, Yellen, is a Democratic Dove and will gleefully extend the supply of money thus undermining the Dollar and asset values. This will result in a monetary form of redistribution of wealth..... Central Bank Socialism!

Currencies remained steady with the EUR 1.3680 and the GBP 1.6150 reflecting the weakness in the Dollar. Risk appetite remains strong and has the associated currencies moving towards recent highs, with the AUD trading 0.9650 and the KIWI slipping back to 0.8420. US Monetary policy will continue to undermine the US Dollar thus supporting currencies, assets and equities.


For more on Collinson FX and market information see:
www.collinsonfx.com and www.collinsonwealthmanagement.com

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by Collinson FX

  

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2:02 PM Thu 24 Oct 2013GMT


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