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Have Global Markets Surged Too High, Too Fast?

September 1st, 2009

Market Highlights:

  • China Recovers Modestly
  • European Equities Drag Despite Improved Data
  • AUD Sinks as RBA Keeps Rates Steady

China Recovers Modestly

Following yesterday’s stock market lashing, Asian equities were able to stage a modest comeback throughout their overnight trading session. The Shanghai Composite Index dusted itself off and added a shade under 1% off the back of an upbeat financial sector and improved manufacturing data. China’s PMI (Purchasing Managers Index) for August rang in with a reading of 54, up from July’s 53.3 result. Traditionally, Read Full Article »

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Currencies Break Out

March 19th, 2009

USD Pounded Amid Fed’s Expansion of Quantitative Easing

The US Federal Reserve announced yesterday that next week it would embark on a program involving the purchase of up to $300B USD in government Treasuries, officially kicking off the governmental portion of their quantitative easing measures. In monetizing the debt, the Fed is essentially removing the US government from the private market as it relates to the competition for today’s scarce investment capital. That being said, $300B essentially amounts to the proverbial “drop in the bucket” when measured against the trillions of US Treasuries outstanding, or even the debt taken on by the Treasury to facilitate its various bailout schemes in the past few months. Nonetheless, the Fed’s printing presses, which have been on standby for quite some time, are now about to be slowly revved up, and the USD is being pounded across the board with the most significant currency breakout to the top-side that we’ve seen since the early days of this financial crisis. Read Full Article »

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