I’m not an economist but I took this as pretty big news. We’re seeing a lot of action in currencies. It’s amazing looking at the G8 economies. Russia, Germany, Italy, Canada, the UK, France, Japan all of these countries have slowing growth or going into recession and have currencies that are getting crushed…and then you’ve got the United States…the President was bragging about the economy last night and the USD has been exceptoinally strong in the last half year.
The U.S. can’t be immune to all of this when the rest of its major trading partners are so challenged, right? Haven’t even mentioned China (copper is down 8% YTD, in USD terms).
I don’t think the US is going to raise rates as quickly as the Fed’s “dots chart” forecasts when you look at the rest of the developed world, but I’m not paid to make these type of calls.
^ The US doesn’t really export much. They just consume and run up debt. As long as the credit lines are flowing, America is growing. Canada’s economy has no impact on the US, though the US has a huge impact on Canada.
^ I can’t argue with any of that, nor am I trying to imply the US will purposefully weaken its currency. I agree with what you say. I’m just surprised at how the U.S. can be so strong, but the rest of the developed world so stagnant (could the market be too optimistic on the US economy?) Another day of USD strength. These are pretty material currency moves. The USD is up vs. CAD, EUR, JPY, GBP all by about 15% each just in the last six months.
It’s not the death itself. It’s the thousand heirs of the next generation that may try to fight for power. The current guy is still in the ‘old school’ generation
^ That is what I meant. As a percentage of GDP US exports aren’t very significant domestically. Its the 2nd lowest in the G20, just Brazil is lower. Germany has half of its GDP as exports, the US? 14%.
Guess you saw that piece on Bloomberg - he’s been saying that for a while tbh. And why wouldn’t he, when he has a vested intereted in gettting SA to open up a wealth fund to diversify away from oil
EOG Resources has actually outperformed the S&P over the last 12 months. I know the futures haven’t fallen as dramatically, but WTI is $51/bbl and on this date last year it was $96/bbl, but the stock is up 19%. Fantastic company, but go figure. Nat gas and NGL’s down, too.
Hard adding some of these companies considering that they are up year-over-year. Quality is expensive in U.S. E&P’s.
Averaging down on the juniors was a smart play. There were days when I thought I was dead wrong, but patience prevailed. I’m back in the green, my energy holdings are up >20% over the last two days. Time to take some profits and reduce exposure as the day/week go on. I’m not bailing in energy, but I will be shifting from juniors to quality and hedging as well.