Morning Headlines July 10, 2009 - Group ANLZ discussion board

Banc of America Merrill Lynch hikes 2010 GDP forecast to 3.7 per cent

• Banc
  of America raises GDP forecast 3.2 to 3.7%
  
• Emerging
  markets expected to lead recovery by 2010
  
• Sentiment
  is showing belief in fiscal stimulus is actually working (Chinese/US led
  growth)
  
• Economist
  are citing fiscal policy, consumer growth, rebound in inventory investmet,
  housing improvements and possible export growth, for a bullish argument
  
• 2010
  estimates on china 9.6%! from 8.3% growth (im sure Chinese estimates will
  be higher)
  
• Capital
  flows to Asia
  
• India
  estimates 7.3% from 7.1growth 2010
  
• South
  korea 4% from 3% and Taiwan 4.5 from 3.5% for 2010
  
• Japanese
  economy is very bad Q1 ’09 but expected to recover
  
• Europe
  will lag all nations
  
• Still
  all these increases are much lower than 2008 #’s
  
• Latin
  America a big question mark
  
• CPI
  cited to have risen marginally (they don’t site core or nominal numbers)
  

http://www.globalfundwire.com/articles/detail.jsp?content_id=341482





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The point to be Taken HIGH expectations for future growth,
if everyone is getting bullish it might worth taking the contraian perspective
and start shorting. Im sure much of these numbers will be revised lower.


-Alex














Emerging economy to lead world out of recession, say fund managers

• Discusses Decoupling theory as possible
  
• There
  is the single minded narrow view that fundamentals is the future and flows
  and trade will not be as big an importance
  in markets
  

http://www.globalfundwire.com/articles/detail.jsp?content_id=341529


---------


As traders will say economist is never good traders, I will
say traders are never good economist. Decoupling theory is a spew of nonsense
that ignores the fundamentals of international trade and finance. The only time
decoupling has ever been proven to be true is during Soviet Union autarky,
which is when the Soviet Union literally cut themselves off from the world
(expect with maybe grain exports which was in decline because of US dominance).

Other than that it is de facto that a country is lacking in
one resource or another and needs to participate on world markets which will
always have correlations and interconnections to primary and secondary markets.

A country that would be “decoupled” would have to have vast
resources and high human capital and technological capital as well. As we saw
in the early late 40’s when India
gained independence they ironically took their favorable balance of payments
and took an ISI (import substitution industrialization) approach to development.
Meaning the erected tariff barriers and focused on domestic growth. Is India the world
leader today? The answer is simply no, in fact they left barriers up way to
long which led to decades of stagnated growth. When they needed to open up to international
markets due to lack of resources, they were not competitive enough to hold its
own.


The point being an idea of “decoupling” is not very feasible
in a globalizing reality. For markets to solely focus on “fundamentals and
earnings” is blatantly ignoring market realities. Furthermore, the use of the
world “fundamentals” is not even clearly defined, as any market will always be
based off “fundamentals” but for surely is not the only leading factor of
markets.


-Alex











European derivatives daily trading volume drops 17.4 per cent in June

http://www.globalfundwire.com/articles/detail.jsp?content_id=341531


----------


Lack of volume confirmation on a trend up or down, the
markets have been trending sideways for some time now, lots of uncertainty
still looming.


-Alex







S&P launches GSCI Crude Oil Covered Call Index

• Launch
  an index to give long-term exposure to crude
  
• It
  seeks to simulate a 'covered call' : an option strategy (A covered call
  strategy is an income-generating strategy used in neutral to bullish
  market environments, where a slow rise in market prices is anticipated.)
  there is a much better explanation here èhttp://www.optionseducation.org/strategy/covered_call.jsp
  – a great resource for all options strategies
  
• It is
  calculated on a hypothetical portfolio consisting of a long futures
  position and a short out of the money call position, both of which are
  rolled monthly.
  

http://www.globalfundwire.com/articles/detail.jsp?content_id=341481


-------


I think this is a really cool index idea, its worth learning
more about to trade to get exposure on crude oil.

-Alex














Indian mutual funds' assets drops 12.3 pct in June

• Outflows
  of bond and money markets
  
• Down from
  may numbers
  
• Click on
  link for great table on flows
  

http://in.reuters.com/article/domesticNews/idINBOM48205120090709?rpc=401&


---------

It looks like Romania maybe one of the exceptions
of getting positive mutual fund flows (more domestic driven market?) while india
is seeing outflows, and as again Asia still takes the spotlight.

-Alex







Natural Gas ETF (UNG) Spikes Higher
to Key Resistance
·
Heading to significant resistance?

http://www.marketoracle.co.uk/Article11919.html





-------

What are key resistance levels for natural gas?


-Alex












"Darwin Japan Hedge Fund Returns 31% Since January on Small Caps"

·
has returned 31 percent since opening to
investors in January (equity investments)!!!!


·
founding president of Darwin Capital in Tokyo. Prior to the
January start, the strategy returned 224 percent in the 27 months through
October 2008 compared with a 54 percent slide in the benchmark Nikkei 225 Stock
Average


·
“What I’ve learnt over the years is that doing
the legwork to find good investments bears fruit,”





-------


Very impressive start for a hedgefund, however they had the
advantage of a parent company.


-Alex