Black Monday

[BlackCross]

The very well connected Lord Rothschild Chairman of RIT Capital.Annual Report...1/3/16... 'There’s an old saying that in difficult times the return ofcapital takes precedence over the return on capital...'

In my half-yearly statement I sounded a note of caution,ending up by writing that “the climate is one where thewind may well not be behind us”; indeed we becameincreasingly concerned about global equity marketsduring the last quarter of 2015, reducing our exposure toequities as the economic outlook darkened and manycompanies reported disappointing earnings. Meanwhilecentral banks’ policy makers became more pessimistic intheir economic forecasts for, despite unprecedentedmonetary stimulus, growth remained anaemic. Notsurprisingly, market conditions have deteriorated further.So much so that the wind is certainly not behind us;indeed we may well be in the eye of a storm.The litany of problems which confronts investors isdaunting: the QE tap is in the course of being turned offand in any event its impact in stimulating asset prices iscoming to an end. There’s the slowing down to anunknown extent in China. The situation in the Middle Eastis likely to be unresolvable at least for some time ahead.Progress of the US and European economies isdisappointing. The Greek situation remains fraught withthe country now having to cope with the challenge ofunprecedented immigration. Over the last few years wehave witnessed an explosion in debt, much of itrepayable in revalued dollars by emerging marketcountries at the time of a collapse in commodity prices.Countries like Brazil, Russia, Nigeria, Ukraine andKazakhstan are, as a result, deeply troubled. In the UK wehave an unsettled political situation as we attempt to dealwith the possibility of Brexit in the coming months. Therisks that confront investors are clearly considerable at atime when stock market valuations remain relatively high......

Plenty more here http://www.ritcap.com/media/annual-report-2015.pdf

[bull....]

the rally continues, did ya know the s%P still appears to be in its long term bull on a weekly after a fake break?

[workingdad]

http://www.nzherald.co.nz/business/n...ectid=11598474

latest data on US manufacturing, construction spending and car sales all up

[trader_jackson]

yes it is good to see markets beginning to wake up to the underlying fundamentals, which are still generally positive, as mentioned several times

[skid]

yes it is good to see markets beginning to wake up to the underlying fundamentals, which are still generally positive, as mentioned several times

you keep saying that TJ but its just plain wrong--construction has gone up the last few months ,but to 49.5 (anything under 50 is still contracting)
Earnings in the US are looking sick--to the point that they are saying that stocks are still overvalued because even with the drop in the stock market ,the reduced earning mean that the eps is still less than before.If shares are earning less for you --they are to expensive.

Its all about oil--not fundamentals like earnings---Now that may come right ,who knows--but to be waiving a banner saying the US is in great shape is very misleading--You cant ''wish'' the US economy into good shape.

sooner or later the influence of oil will cease to be the front runner and more basic problems will have to be addressed--why do you think they (Fed)are afraid to raise interest rates?

This doesnt mean the stock market wont go up--but all is not well when you scratch beneath the surface

China did well yesterday --but if they get more of those 5-6% drops they will do something about it,and if it involves currency it will not be pretty.

[xafalcon]

Its all about oil--not fundamentals like earnings.

I think it's wider than oil

IMO it's all about competing theories about potential future influences and the effect these may have on the markets.

Whichever theory gets the most air-time gains traction, until it is disproven or the next theory comes along that appears to make more sense

The media is happy to jump on the band waggon and quote these theories to the masses as if they were fact

Joe public often believes what is written, and so it is perpetuated

Oil is just the current (but waning) theory, US interest rate rises will oscillate up and down the list in coincidence with FED decision dates, Greece is sure to come back out of the closet in a period of quiet, Brexit seems to be a trendy new entrant, the EU migrant "crisis" must be in the mix, China GDP growth decline can always be relied upon to bring fear into the market, Russian economic trouble could be a nice pick-me-up for the western world, Iranian economic expansion post sanctions doesn't fit with doom & gloom (except increased oil production) so may not get much air-time, deflation seems to have gone quiet recently, as has Japan's 3 arrows, post-GFC economic modelling theory inaccuracy has been a solid performer in the past and I'm sure is due for a come-back .........

But I agree that fundamentals appear to have little relevance ATM

[percy]

Meantime in NZ my holdings are going gangbusters.
EBO,CVT are running strongly this week..
All shares I hold had great results and are increasing their dividends.
Low interest rates are pushing my high yield NZ stocks to new highs.

[xafalcon]

Meantime in NZ my holdings are going gangbusters.
EBO,CVT are running strongly this week..
All shares I hold had great results and are increasing their dividends.
Low interest rates are pushing my high yield NZ stocks to new highs.

Shhhh. Don't say that. You are bursting the bubble of the doom & gloom merchants.....

Repeat after me - the world is doomed, economic meltdown is about to commence, sell all investments (remember this is about capital preservation, not capital growth), fill the mattress with gold and cash because everything else will be worthless, for the good of the entire world the oil producers should be paid much more for their natural extract, China will drag the world into economic depression.......

PS. My NZ equities are also doing well, with SKL the notable exception

[winner69]

yes it is good to see markets beginning to wake up to the underlying fundamentals, which are still generally positive, as mentioned several times

S&P earnings lowest since 2010 and Q116 nt lookingsitive
http://www.zerohedge.com/news/2016-0...nting-gimmicks

[skid]

Shhhh. Don't say that. You are bursting the bubble of the doom & gloom merchants.....

Repeat after me - the world is doomed, economic meltdown is about to commence, sell all investments (remember this is about capital preservation, not capital growth), fill the mattress with gold and cash because everything else will be worthless, for the good of the entire world the oil producers should be paid much more for their natural extract, China will drag the world into economic depression.......

PS. My NZ equities are also doing well, with SKL the notable exception

No one is telling you guys to go and sell all your NZX holdings --just watch out for extremes--you have done a good job of sarcastically describing one extreme-now maybe its time to look at the other ''rose tinted glasses opposite extreme and maybe find some middle ground.

If your trying to figure out the USA and world economy --go ahead..throw the theories out and look at the facts--you can start with the earnings reports---Have you noticed that alot of the fundamentals of the US economy are not looking good --but rise and drop of oil is what is calling the shots on the stock market--

the NZX is performing better than alot of world economies and some shares are performing better than the NZX top 50----Thats a good reason to let your profits run,but a lousy guide to judging the state of the world economy IMO