"Global markets are sounding the alarm of rapidly intensifying deflation. Commodity prices such as oil and copper are in free fall, while equity prices are hurting as well. Japan’s Nikkei Dow lost 10% in May alone, which was its worst monthly loss in two years? But Japan isn’t alone. The Chinese Shanghai composite is down nearly 20%, Spain’s IBEX is down nearly 50%, Italian stocks fell 45% and Greece is down over 60% from the year ago period. The only market yet to succumb to the carnage is the U.S., whose averages are roughly unchanged for the year. However, the S&P 500 has lost nearly 10% over the last 30 days, and is now in full catch up mode with the rest of the world."
5 comments:
The problem of course is insolvency, not liquidity. There is a big hole to fill and nothing to fill it with. European depositors don't insurance as we do in the U.S., so the depositors are prone to panic. I read where every safe deposit box in German is rented, and people are stuffing them with gold and silver.
The U.S. is not far behind, and it looks like the U.S. stock market is set for a dive. I have been mostly in cash for a year waiting for the big crunch. The few things I do own have done very well, and actually went up last week. When I see the adjusted Tobin's Q for the market fall far enough I will jump back in. The big question I have now, is whether California will go into default on its bonds. Like Greece, California will not face reality. For example the governor still want that high speed train to nowhere. He just can't help himself the way the Greeks can't either.
I like your picture. I wish I were much younger.
You ARE younger. People today lives much longer. Old people can look forward to a long future horizon.
I have doing badly. The Nochi Dankner debacle is hurting me. His empire is solid, yet investors are condemning it and nothing can be done against that. I bought IDB bonds, he has the cash to pay them off yet the market doubts it. It is in the junk area, yielding 50%!!
The only way there can be no inflation with all this money creation is that it is balanced by money destruction.
Anon.
Yes, but they are destroying MY money !!!!
The question is, how to shelter from the storm.
Anon.
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