Are you feeling bullish in 2012?
Many hedge fund managers are feeling bullish on the U.S. economic recovery, China having a softer-than-once-feared landing, and the EuroZone crisis improving somewhat. So, rather than general economic optimism, this is more a better than worst case scenario in which the U.S. has not yet recovered from the financial crisis and recession, China’s growth will slow but hopefully not with a quick halt, and the problems in Europe improving slightly upon the gloomiest predictions.
So, how are you feeling for 2012? Do you think Europe’s problems will continue to cause volatility in the markets and drag down a U.S. recovery? Will China continue to grow?
I think Europe debt issues will continue to dominate the world scene and the sharemarkets will remain volatile. It remains to be seen what happens with Iran and other oil producing countries in the Gulf. If Israel becomes aggressive towards Iran then this may become a major effect on the markets, particularly with regard to commodities. However, since Iran has ceased to sell oil to the Eurozone it will develop its trade with China, Russia and other emerging markets, and the development of mutual inter-trade relations between the BRIC economies will generate a shift in market trends and in the global balance of power. I see China slowing in terms of trade with the West, but continuing to become a major power through developing its presence in smaller economies. I think the escalation of political and military tensions will be the highlight of the year as the US becomes more and more frightened of losing its strategic power
I am bullish based on the fact that with Europe imploding coupled with real interest rates producing negative yields after inflation (real inflation) and a skittish real estate market, there are very few safe alternatives for the average investor. Like lambs headed for slaughter, they are being herded down a single path which I believe could end badly given my agreement with Jillian’s comments.
like Jillian’s comments on Europe’s debt continuing to be a headline. I have yet to be convinced that the EU is handling it’s debt problems with Greece. Obviously my comments are in the face of yesterday’s news but let’s face it…this is not the first time we heard that Greece is getting its act together. Until we see some true draw-downs on spending and until see some true figures pointing toward sustained austerity, I feel that the EU remains a significant story. Furthermore, I see Germany as becoming increasingly frustrated with being yanked into these continued bailouts and rescues and they may very well threaten to leave the EU.
Isn’t this a Bear market rally? You can’t ignore the trends in unemployment but still we face an unemployment rate double what I can remember in my educated life. Interest rates and the value of the dollar will ultimately play into the future of this market.
I think everyone should hold a little gold and at the very least, do research to have a few Gold related names ready to pull the trigger on.
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