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Posts Tagged ‘Globalization’

Waving the White Flag

John Mauldin is one of my favorite newsletter writers.

This week’s newsletter speaks exactly to what my video above addresses–the elephant in the investment room is Europe.

I highly encourage you to set aside 10 minutes to read this weekend’s newsletter. It goes into greater depth than I can in the 3 to 4 minutes for my video.

Europe is the concern as we enter the dull summer months.

 Waving the White Flag

China Had a Trade Deficit in February

China had its largest trade deficit in 22 years this past February of $31.5 billion.

Why? Weaker demand from Europe and the United States is one reason. Factories being temporarily shut down due to Chinese New Year could be another reason.

Is this seasonal anomaly or one more bad sign coming out of China?

Stay tuned

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China’s Inverted Curve

An inverted yield curve in the US has predicted 6 out of 7 worsening economic conditions in our country since 1970.

In China, we don’t have the same type of statistics because of their young open economy, but recently their yield curve has “inverted”.

I’m watching this and realizing it’s just another of many economic indicators out of China pointing towards a slower economy.

I really don’t want much (if any) exposure to the Chinese Stock Market.

This also has consequences to the whole… Read More

Unemployment Rate / Participation Rate

Unemployment decreased to 8.3%. Good.

Participation Rate of the work force at 30 year lows. Bad.

In my opinion, we’re at a time in history where there is a dramatic shift in the employment make-up, skills needed, globalization, etc.

This relatively short term (1 to 10 years) transition will not be without pain for many, but the market does eventually adjust.

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Interactive Comparison of GDP

The United States is the largest GDP in the world. How do other countries stack up to individual states? See for yourself.

Here’s a great interactive comparison website.

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Corporate Profitability

I say in my video that “on balance” I’m more optimistic than pessimistic for 2012.

See graph to right.

Europe, China, Deleveraging, etc. are the forces against this we have to watch out for.

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2011 Recap and 2012 Outlook – Year End Video

Goodbye 2011 and hello 2012! What happened and what’s my outlook for 2012? Optimistic or pessimistic?

Watch my video to find out.

 

TRANSCRIPT:

Hi there, Mike Brady with Generosity Wealth Management, and today I want to talk to you about a little bit of a review on 2011, but spend most of my time talking about the current situation right now. And you know, maybe do a little bit of a, …, thinking about 2012 and what the future may hold.

2011 was a real volatile year. I mean frankly… Read More

Global Manufacturing

In line with my video where I talk about the underlying numbers of the economy, one statistic that is not getting much media play is Global Manufacturing.

In most countries manufacturing is contracting, except for a few select, including the United States.

Hmmm, what is this telling us? This is a problem in a global economy and over the coming months I’ll continue to watch the trend.

Nothing to do now but be aware of this indicator.

Click

3rd Quarter Review / 4th Quarter Review

The 3rd Quarter 2011 is over and I have a slightly longer video this week because I want to address the current environment and how things may shape up going forward.

A big theme is my advice to assess your overall plan and risk tolerance, and also to ensure you’re looking at both positive and negative points of view on the markets instead of just one view over the other.

I send my newsletter and videos on a weekly basis, so if you watch only a few througout the year, at least watch my… Read More

Europe – Echoes of Lehman

The big question we need to answer is “what happens after a Greek default?”.

Lehman’s collapse was a full year before the financial crisis of 2008, and it’s very probable the full impact of Europe imploding won’t be felt for some time.

We, as investors, need to stay informed and ready to react.

Please continue to read my newsletters and blogs, and have my number in your speed dial. 303.747.6455

CLICK FOR FULL ARTICLE – EUROPE ECHOES OF LEHMAN

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Where Do We Go From Here?

I’ve had a relatively low position in stocks for clients for quite some time, but I’ve decided to lower it even further. I’m quite concerned about the correlation between Europe and the US, emotion/news driven volatility, and the uncertainty about what the Fed will do.

The risk just doesn’t warrant having as high a percentage as I’ve had.

On the flip side, profitability, efficiency, and cash balances have all been rising in the firms that comprise the S&P 500.

Is the return worth the risk?

Click on video to hear more.

TRANSCRIPT… Read More

Correlation as Long-Term Pandemic

Statistically speaking, when 2 or more things move together (both zig at the same time instead of some of them zagging) it’s called a correlation of 1.0. Over the past 30 years the correlation of the global markets have continued to increase towards 1.

This means that it’s a high probability that as Europe falls, it will impact our US markets. How much is the question, but our fates seem to be intertwined.

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Globalization and Japan

Like it or not, globalization is here to stay. Japan, and the impact on supply chains throughout the world, is only going to reinforce the move towards a diverse, diffused world economy.

In the coming years, we’ll see an even greater push toward interrelatedness amongst countries, and each country’s businesses will rely on many countries for their materials. Diversification of supply is key.

Japan is going to recover and recover quickly.

TRANSCRIPT:

Hi Clients and Friends, Mike Brady here.

This week I want to talk about globalization. It’s here to stay and Japan… Read More

Emotional Selling

The tsunami that hit Japan last week and has affected their nuclear reactors is causing great concern in the stock markets.

The Nikkei dropped 11% a few nights ago. The US markets have dropped 2% this morning (Tuesday as I write this).

Now is the time to determine if you’re gambling or investing?. Is this an emotional sell off or a harbinger of things to come?

I discuss Emotional Selling in my video this week.

TRANSCRIPT:

Good Morning Clients and Friends, Mike Brady here.

This week I want to talk about emotional… Read More

How Should Investors React to Geopolitical Shocks?

The article I link to below expands on the themes I bring up in my weekly video. You want a double dose of “emotional selling”? You know you do. Click on the link.

Don‘t forget the unexpected happens. The “Peace Dividend” after the Berlin Wall (quite a euphoric event) saw the next 2 years in a stock market recession.

After 9/11? 6 year stock rally ensued.

It is uncertain the long term effect of the Japanese troubles. Let’s not make long term decisions based on short term… Read More

Where Does our Oil Come From?

In case you’re curious where the world’s oil supply comes from, there’s the breakdown by country. I think there’s a perception by most Americans that we get all of our oil from the Middle East, but that’s simply not the case. Saudi Arabia, for instance, is only 11.9% of the world’s supply.

That’s a lot, but it’s certainly less than what most people perceive.

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Just When You Thought the Euro Was Out

You’ve been reading my newsletters and saying “boy, that Mike Brady knows everything”. That may be true, but it’s good to remember the markets have a mind of their own.

The Euro has rallied against other currencies recently.

Do I think this is a short term rally? Yes. Do I think the Euro and Europe in general still have long term problems? Yes.

CLICK FOR FULL ARTICLE – JUST WHEN YOU THOUGHT THE EURO WAS OUT

Is This Your Average Secular Bear?

In my blog I like to present both sides of the argument and then give you which side is more persuasive to me.

This article states what I feel, which is that we’re in a long term bear market, but we’ll have years that are good (like 2009 and 2010).

Secular bears end when the excesses that caused the prior bull are extinguished.

I’m not convinced we’ve addressed the excesses yet.

 CLICK FOR FULL ARTICLE – IS THIS YOUR AVERAGE SECULAR BEAR?