Just came across this really cool site that gives you GDP, inflation, interest rates etc for all countries in the world.
Just move your mouse over to the world map and you can see data for that country.
http://www.tradingeconomics.com/
Friday, August 27, 2010
US exports over the years
One of my friends told me that US is not an exporter and my statement in my earlier post regarding dollar devaluation is incorrect. Just wanted to indicate here on how US exports have been rising oevr the years. It is now the third largest exporter in the world.
Stay away from equities for a month
The US labour market seems to be only heading towards the doldrums, at least for the next 2 quarters. Manufacturing activity seems to be slowing down, retail sales are low and housing is in the worst mess in the history of US. The fed has accepted that things are not going the way they expected and have to soon take a decision on how to spur the economy.
My guess is that although everyone is talking of quantitative easing part II, but I do not think the fed can really repeat their act of printing trillions of dollars again. Debt as a % of GDP is at 117%, and research suggest any additional debt taken would definitely result in a double-dip recession. Obviously the fed cannot risk this.
The solution to this problem could be to improve trade balances of the economy of US. They can de-value the dollar to ensure exports become more competitive.
This may take a while to materialize and in the near term (one month) there seems to be no trigger on the upside. Even if a step like this is taken, it takes at least 6 months to show up in the figures.
The only trigger that can come is towards October when the upcoming festive season may see some buoyant spending.
Given that the savings rate is at a 6 month high again, the only reason I am not saying go short is because I believe this may prevent the markets from totally tanking. Also another interesting fact is that the yield on dow-jones is now higher than the yield on treasuries. Treasury seems to be the asset in favor, however as good news may start to pour in, money can soon return to equities.
Given the uncertainty I suggest just stay away from the markets for a month till some clarity emerges. Use the time to take a holiday and enjoy!
My guess is that although everyone is talking of quantitative easing part II, but I do not think the fed can really repeat their act of printing trillions of dollars again. Debt as a % of GDP is at 117%, and research suggest any additional debt taken would definitely result in a double-dip recession. Obviously the fed cannot risk this.
The solution to this problem could be to improve trade balances of the economy of US. They can de-value the dollar to ensure exports become more competitive.
This may take a while to materialize and in the near term (one month) there seems to be no trigger on the upside. Even if a step like this is taken, it takes at least 6 months to show up in the figures.
The only trigger that can come is towards October when the upcoming festive season may see some buoyant spending.
Given that the savings rate is at a 6 month high again, the only reason I am not saying go short is because I believe this may prevent the markets from totally tanking. Also another interesting fact is that the yield on dow-jones is now higher than the yield on treasuries. Treasury seems to be the asset in favor, however as good news may start to pour in, money can soon return to equities.
Given the uncertainty I suggest just stay away from the markets for a month till some clarity emerges. Use the time to take a holiday and enjoy!
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