It has been a lousy three months for hedge funds.
According to Hedge Fund Research's HFRX Global Hedge Fund Index, funds fell 0.94% on average in June and 2.79% in the three months ended June. This was, apparently, the worst second-quarter performance since 2000 when the industry lost 3.42%.
As the credit outlook of southern European high-deficit countries worsened, Soros said Berlin needed to switch its economic policy from deep austerity measures to a more pro-growth agenda. Chancellor Angela Merkel announced plans this month for €80bn (£66bn) in budget cuts.
Soros said: "German policy is becoming a danger for Europe, it could destroy the European project. Right now the Germans are dragging their neighbours into deflation, which threatens a long phase of stagnation. And that leads to nationalism, social unrest and xenophobia. Democracy itself could be at risk."
Life is tough. We’re better off planning on how to manage through harsh and ugly reality than having it hit us over the head as we smile on believing the economies of the world are recovering.
CNBC is on TV claiming a trader error was responsible for the decline. What about the decline earlier this week? What about all the bourses in Europe. What about the futures for Japan?
You people (the media) are bold faced liars. We cannot believe Anything you say.
Lets dump the talking heads at CNBC. This guy David Faber is ridiculous. Look at the carry trade changes today - the yen moved 4% verses the dollar today alone. Was that an error David? Huh David? You @#$%&!. Everyone can see that Greece cannot live up to any accord. They will default. And so will Spain and Portugal. And some major European banks will fail. And so will some U.S. Banks.
I watched the tapes today and I can tell you, absolutely and positively, that fear, not a trader’s error, took down worldwide markets. Tomorrow, many institutions are nervous and they are going to take money off the table.
Now the @#$%&! says that we in the middle of a recovery and expansion story. Lets watch foreclosures and jobs the next six months and see.
All you need to do is look at Greece to understand where we are headed. The populace is ticked off in a major way because now they are being told that they need to live within their means. Not only do they need to live within their means, the “forced austerity” will suck growth out of the economy and turn it negative to a greater degree. What I am trying say here is that the “ship has hit the sand” and the years of reflating the system have come to an end globally whether anyone wants to admit it or not. To raise taxes and cut spending during a recession is a Keynesian no no because the economy will spiral downward in a debt implosion.
THIS is exactly what the Austrian economists have said for years upon years while being laughed at and ridiculed. We will now see exactly who has been correct, the “paper pushers” or the “common sensers”. Did Greece go out on its own and invent deficit spending? Of course not. Have they done anything that anyone else (in particular Britain and the U.S.) did not do? No, in fact, just look at what the West has done for the last 18 months as their “cure” for the GFC and you’ll see Greece with twin turbos and NOS! The entire system has become unstable and anything can happen at anytime.
The “mark up” phase will not take very long, of course this also means that the “wipeout” phase will not take much time either. Millionaires who have lived on interest and dividends for years and have not worked in years (or maybe never did) will end up losing their wealth over what I believe could be as short as a 2 week period. Judging by previous currency collapses such as in Argentina, these privileged individuals may very well end up in dumpsters with their feet pointing skyward looking for food. Laugh all you want, this has happened before but NEVER on a global scale as today.
The new “indicator” of how things are financially will be Gold. People will wake up in the morning and look to the price of Gold as to whether it will be a “good day” or bad. Gold is up $32 right now and it seems a few people on CNBC understand what higher Gold means today. I am rubbing my eyes and trying to clear my ears because THIS is unbelievable. As I said before, “my how times have changed”. Stay alert, locked, loaded and fully stocked.
Got Gold?
100-pip EA system
No. of auto-entries: 1
EUR/JPY +40 & 88 (maximum target hit !)
** EUR/USD is now floating around support 1.4750 after completing a retracement off the support area 1.4720-25, after a 240-pip decline from 1.4965 highs.
** USD/CHF behaviour today was largely driven by the maniac EUR/CHF rise.
** GBP/USD today behaved as one of the 'carry cows'.
** the name of the game today was in the JPY and CHF crosses, who advanced like maniacs across the board.
