Agriculture
On the Corn front, Brazil’s domestic corn prices have risen, and their opening stocks were 30% lower than last year following record highs of exports last year. Rio Grande do Sol, Parana, Brazil’s second largest corn producer was hit with unfavorable weather conditions which delayed their 2nd harvest. In the overnight electronic session, the December Corn is currently trading at 356 ¾ which is 2 cents lower.
Currencies
Since the money printing growth rate is highest in the US for the past 6 months, the value of US$ as expressed in the dollar index has become weaker. $TLT, UUP*TLT in gray color, represents the real value of TLT by including the value of the dollar index as UUP. The diagram below shows the shifts to the more advantageous assets if the dollar continues the slide by the monetary easing actions of the Fed. One group exiting are foreign owners of US high-flyers, worried about the US dollar at a two year low.
Source: Bloomberg The Dollar managed to hold gains today but was very uninterested in the chaos underway in stocks… All these assets are subjected to the devaluation of the dollar as well. This is almost a full dollar per share lost due to COVID-19. The only interruption was the 2-week spike of UUP in March which was the liquidity crisis when the dollar was king. Next week’s meeting will bring another communication test for Christine Lagarde: how to temper the euro without causing unwarranted market movements.
With Europe being the main theme of my professional life, obviously something to say on the euro crisis. In 2008, I joined ING and immediately had to put my experience on Europe, the Euro and policy-making into practice.
Source: Bloomberg The Dollar managed to hold gains today but was very uninterested in the chaos underway in stocks… All these assets are subjected to the devaluation of the dollar as well. This is almost a full dollar per share lost due to COVID-19. The only interruption was the 2-week spike of UUP in March which was the liquidity crisis when the dollar was king. Next week’s meeting will bring another communication test for Christine Lagarde: how to temper the euro without causing unwarranted market movements.
With Europe being the main theme of my professional life, obviously something to say on the euro crisis. In 2008, I joined ING and immediately had to put my experience on Europe, the Euro and policy-making into practice.
Metals
To regard gold as the main theme means to compare the performance of other assets against gold and use gold as default for savings. Converting other financial assets in the gold space, divided by gold, reveals a different performance perspective of each asset. Generally, gold plus international bonds and stocks with rising currencies with no currency hedge are becoming the preferences. Both physical gold and miners with improving earnings growth are becoming fashionable among the major players.
The Copper Development Association estimates that every wind turbine uses between 2.5 and 6.4 metric tons of copper per megawatt. Allison Boxer, Joachim Fels August 2020 Blog Despite reaching record highs earlier this month, gold remains attractively valued, according to our framework. Unlike in gold, bullion banks have no incentive to stop this from happening, because they are net long palladium. With rising gold prices more than $500/ounce, the earnings are becoming more attractive.
The 4 major assets include US$ and gold (UUP & GLD). The biggest question for gold is when this rising trend will end. Even SPY/GLD is lowered than the 02/2020 peak mostly due to the strong rise in gold. The timing indicator has been quite accurate in signaling the entry points for gold. A standard-sized electric car uses about 183 pounds of copper, according to the Copper Development Association. If stocks fall, gold will be even higher. For copper, the world’s most important industrial metal, the rebound has been largely driven by cyclical factors.
Palladium is now more valuable than gold. The same process above is expanded to gold and US$ as indicated by $GLD and UUP. The most likely beneficiary is gold. $Gold rose steadily for the past 6 months. Perhaps gold or bitcoins.
The Copper Development Association estimates that every wind turbine uses between 2.5 and 6.4 metric tons of copper per megawatt. Allison Boxer, Joachim Fels August 2020 Blog Despite reaching record highs earlier this month, gold remains attractively valued, according to our framework. Unlike in gold, bullion banks have no incentive to stop this from happening, because they are net long palladium. With rising gold prices more than $500/ounce, the earnings are becoming more attractive.
The 4 major assets include US$ and gold (UUP & GLD). The biggest question for gold is when this rising trend will end. Even SPY/GLD is lowered than the 02/2020 peak mostly due to the strong rise in gold. The timing indicator has been quite accurate in signaling the entry points for gold. A standard-sized electric car uses about 183 pounds of copper, according to the Copper Development Association. If stocks fall, gold will be even higher. For copper, the world’s most important industrial metal, the rebound has been largely driven by cyclical factors.
Palladium is now more valuable than gold. The same process above is expanded to gold and US$ as indicated by $GLD and UUP. The most likely beneficiary is gold. $Gold rose steadily for the past 6 months. Perhaps gold or bitcoins.
Oil
Prior to COVID-19, even after the 2016 collapse in oil prices, the Permian Basin was one of the most exciting long-term oil production growth opportunities. Following US sanctioning Iranian oil, President Trump requested the Saudis to “push oil prices lower”, and in turn, the Saudis used the same tools (exports to the US). While I do expect the oil and gas market to recover over time, it will likely take even longer for the fracking part of the DES business to recover.
In the case of BOIL, it is an ETF which is holding exposure to natural gas futures utilizing the Bloomberg natural gas methodology.
Source: Royal Dutch Shell Investor Presentation In addition to all that, as oil and natural gas prices hit a record low, bankruptcies continue to mount. The lower exports combined with stale US oil production growth during Q2 and Q3 of 2017 allowed the US crude storage to drop at the fastest clip in history. On top of that, large-cap oil & gas companies are the best positioned to expand into hydrogen, biofuels, and even some areas of renewable energy. The carbon footprint of producing hydrogen from natural gas is higher than burning the gas.
Investor concerns about the company’s debt are mostly solved at current oil prices, despite the market’s refusal to acknowledge these facts. At the same time, the pandemic dealt yet another blow to the already troubled oil & gas sector. We believe that across the next 7 years, given current oil prices, it is incredibly likely for that to happen. Natural gas is likely overbought, which suggests that better prices can be achieved over the next 1-2 weeks for short-term traders.
Occidental Petroleum’s risk is from lower oil prices, and the warrants are much more susceptible to that. Of course, the company is always at the whim of oil prices. Defining Occidental Petroleum’s future potential is the company’s asset base and its ability to produce oil from that asset base. All said, month two exposure to natural gas is a strong win in my book. In this article, I will discuss the specific nuances of BOIL as an ETF as well as the overarching fundamentals at work in natural gas.
Natural gas fundamentals are bullish, as supply is collapsing at a faster pace than demand. Major oil companies such as Exxon Mobil (XOM) had made it a major part of their long-term growth strategies. This is important because after oil collapsed in 2014, none of them wanted to get rid of rigs in case the decline was temporary.
In the case of BOIL, it is an ETF which is holding exposure to natural gas futures utilizing the Bloomberg natural gas methodology.
Source: Royal Dutch Shell Investor Presentation In addition to all that, as oil and natural gas prices hit a record low, bankruptcies continue to mount. The lower exports combined with stale US oil production growth during Q2 and Q3 of 2017 allowed the US crude storage to drop at the fastest clip in history. On top of that, large-cap oil & gas companies are the best positioned to expand into hydrogen, biofuels, and even some areas of renewable energy. The carbon footprint of producing hydrogen from natural gas is higher than burning the gas.
Investor concerns about the company’s debt are mostly solved at current oil prices, despite the market’s refusal to acknowledge these facts. At the same time, the pandemic dealt yet another blow to the already troubled oil & gas sector. We believe that across the next 7 years, given current oil prices, it is incredibly likely for that to happen. Natural gas is likely overbought, which suggests that better prices can be achieved over the next 1-2 weeks for short-term traders.
Occidental Petroleum’s risk is from lower oil prices, and the warrants are much more susceptible to that. Of course, the company is always at the whim of oil prices. Defining Occidental Petroleum’s future potential is the company’s asset base and its ability to produce oil from that asset base. All said, month two exposure to natural gas is a strong win in my book. In this article, I will discuss the specific nuances of BOIL as an ETF as well as the overarching fundamentals at work in natural gas.
Natural gas fundamentals are bullish, as supply is collapsing at a faster pace than demand. Major oil companies such as Exxon Mobil (XOM) had made it a major part of their long-term growth strategies. This is important because after oil collapsed in 2014, none of them wanted to get rid of rigs in case the decline was temporary.
United States
Zoom reported the second-largest sales surge among NASDAQ 100 companies last quarter, clearly separating itself from those players whose stock valuations aren’t backed by strong sales. Daniel J. Ivascyn May 2020 Blog The Fed’s aggressive support may help keep markets functioning, hasten recovery and avoid longer-term damage. In practice, this meant the Fed had to both estimate the natural rate and raise interest rates if actual unemployment threatened to fall below it.
Repeating Greg Ips point, in the new Fed regime unemployment can be too high but never too low. On Thursday, August 27, equities witnessed small gains as investors assessed the implications of the Fed’s new policy shift. one student said, adding: Investing.com Follow Zoom Video Communications (NASDAQ:ZM) has had an incredible run this year. As I’m sure all readers are aware, due to the economic turmoil caused by the COVID-19 pandemic, the Fed cut interest rates to essentially zero back in March.
less BYND shares traded higher on Thursday after one Wall Street analyst initiated bullish coverage of the stock.
For instance, the Nasdaq bubble was a classic price compression.¹ In the long-term there was nothing unsustainable about the cash flows and valuations that would accrue to tech firms. )The Nasdaq Composite’s sell-off Thursday could be the beginning of a more significant pullback for the tech-heavy index, according to technical analyst Jonathan Krinsky. Could you imagine the euphoria of Trump supporters if this is what the numbers actually show on the night of November 3rd? Gene Frieda, Sachin Gupta August 2020 Blog Fed officials seek higher inflation but need help from fiscal policymakers.
Wall Street lost 5% across the board between election day and Gore’s concession. The short answer might be when the Fed slows money printing which is at least 2 years away. The much deeper problem for the US economy is the asymmetric impact of Fed policies on households and businesses. In another video shot by Campus Reform, most students admitted that if Biden refuses to debate Trump, it would be a “weak” move.
The answer to this is the same as it is for many other companies over the last few months: The Fed. The real economy is down in the dumps while Wall Street is popping champagne almost every day. Today, Wall Street continues to use Zacks research including the Zacks Rank and Zacks Equity Research, which combines the best of quantitative and qualitative analysis. The Fed’s monetary and regulatory policies have contributed to a form of capitalism where the rewards are going to the 1% and the risks are borne by the 99%.
Repeating Greg Ips point, in the new Fed regime unemployment can be too high but never too low. On Thursday, August 27, equities witnessed small gains as investors assessed the implications of the Fed’s new policy shift. one student said, adding: Investing.com Follow Zoom Video Communications (NASDAQ:ZM) has had an incredible run this year. As I’m sure all readers are aware, due to the economic turmoil caused by the COVID-19 pandemic, the Fed cut interest rates to essentially zero back in March.
less BYND shares traded higher on Thursday after one Wall Street analyst initiated bullish coverage of the stock.
For instance, the Nasdaq bubble was a classic price compression.¹ In the long-term there was nothing unsustainable about the cash flows and valuations that would accrue to tech firms. )The Nasdaq Composite’s sell-off Thursday could be the beginning of a more significant pullback for the tech-heavy index, according to technical analyst Jonathan Krinsky. Could you imagine the euphoria of Trump supporters if this is what the numbers actually show on the night of November 3rd? Gene Frieda, Sachin Gupta August 2020 Blog Fed officials seek higher inflation but need help from fiscal policymakers.
Wall Street lost 5% across the board between election day and Gore’s concession. The short answer might be when the Fed slows money printing which is at least 2 years away. The much deeper problem for the US economy is the asymmetric impact of Fed policies on households and businesses. In another video shot by Campus Reform, most students admitted that if Biden refuses to debate Trump, it would be a “weak” move.
The answer to this is the same as it is for many other companies over the last few months: The Fed. The real economy is down in the dumps while Wall Street is popping champagne almost every day. Today, Wall Street continues to use Zacks research including the Zacks Rank and Zacks Equity Research, which combines the best of quantitative and qualitative analysis. The Fed’s monetary and regulatory policies have contributed to a form of capitalism where the rewards are going to the 1% and the risks are borne by the 99%.
Europe
less Next week’s ECB meeting could open the door to additional easing before the end of the year. By now, I have built up excellent skills and experience in analyzing macroeconomic and political developments in Europe, the Eurozone and Germany, including ECB watching. Ten months later, Lagarde has gone through a sea of emotions and the worst economic crisis in decades. The UK government has promised a green recovery, but the EU has set the global standard.
Catalytic converters used to contain an average of $27/unit of palladium under the old EU regime. Angela Merkel may scupper the Nord Stream 2 pipeline to Germany from Russia over the attempted murder of Alexei Navalny. Main focus: Europe, Eurozone, Germany and ECB.
0 Catalytic converters used to contain an average of $27/unit of palladium under the old EU regime. Angela Merkel may scupper the Nord Stream 2 pipeline to Germany from Russia over the attempted murder of Alexei Navalny. Main focus: Europe, Eurozone, Germany and ECB.
