(Hate
to say I TOLD YOU SO......ALL last year and the year before
that, too!! No I don't!! LOL..... )
When
the world RUNS for SAFETY....they STILL run to the US!!
Now
it's because of Spain...and before that because of
Greece...and before that, etc, etc, etc....
When demand exceeds supply (people want to BUY MORE US Gvt
bonds, than want to sell them) ...... yields go
where? They go DOWN! (Because prices go UP.)
Andddddd........... before international buyers can buy US
Gvt Bonds, they have to do WHAT?? They have to convert
into/buy US Dollars FIRST!
And we didn't think Yields could go DOWN any
further..... UGH!
Yields continue to be at ALL TIME (almost) RECORD
LOWS. Where can a person put money for a nice yield any
more??? Answer: NO WHERE. Look at bank CD rates
and everything else.
See chart below: This is the Euro to the US Dollar
over the last 5 years. The HIGHS are when the Euro was
expensive adn the US Dollar was DOWN (cheap).
The LOWS are when the Euro was falling apart and the US
Dollar was UP!! Notice at all the LOW points....that's
when the world was running for safety in the US
Dollar.....running to buy US Gvt Bonds....RUNNING FOR Safety.
There was actually a time in 2008, when there was so much
money running to buy US Tsy Bills, that the yield BECAME
NEGATIVE!! Why? People didn't care about the
yield...they cared about the safety of their principal.
In Germany right now, the German 2yr note yield is now ZERO
% !!!! Hmmmm, so Germany is still considered as
SAFE as the US. ??
QUESTION: If yields are so LOW.......and everyone's
running for safety.....WHY ARE THE US/EUROPEAN STOCK MARKETS
NOT.......NOT.....FALLING APART LIKE THEY DID I 2008?
Answer: (My perspective) The problem with the
banks in 2008, was that the problem was UNPRECEDENTED...it was
NEVER SEEN BEFORE....and eveybody panicked.....the sellers
overwhelmed the buyers of stocks and the markets went down by
50% ALL OVER THE WORLD.
This (today) seem more "managed" and less "panicked."
And....WHERE ELSE ARE THE BIG MONEY PLAYERS GOING TO PUT THEIR
MONEY TO GET A DECENT RATE OF RETURN? Ah, the
Stock markets....thus the markets are NO getting
crushed........at least not YET! Do I agree with
this? NO! I think the problems in Europe (and in
the US) will soon, become UNCONTROLABLE!
There was an article a couple weeks ago that
headlined: "2013 Looks Bleak and as for 2014.....God
only knows"
Let's face it NOTHING NOTHING
NOTHING..... HAS BEEN FIXED. Not in Europe, Not in the
United States..... all the leaders in politics and in
finance have just kicked the can down the road. But, ONE
DAY...it will need to be fixed.
OR...
the Rapture Happens...it just won't matter then....as the
A/C rises to calm the whole world.
As I've said before......the dominos are all lined
up....just waiting for what? to make them fall? The
Rapture!!
could the Rapture be still THIS year....2012?
Maybe on Rosh Hashanah?
That's MY hope!!
TICK TOCK....
YFIC,
Randy
