Given the spotlight that’s been shown on gold lately, some might naturally view it as the best investment to buy after a crisis strikes.
However, based on the following chart, some might argue that emerging equity markets are the true safe haven.
I guess we’ll just have to see what happens next time…
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
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"The Greek offer is not sufficient and they have to go away to come up with a revised plan," said a spokesman for the German Finance Ministry. The Greeks must first have a plan that satisfies the Germans which this comment states they clearly don't yet and then the Greek Parliament will vote on it this weekend. This said, whatever package gets voted on in Greece is basically an up or down vote on euro membership so we are entering another uncertain weekend for global markets. A failed vote will likely lead to a hard default which may be what...
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December 2nd, 2009 at 3:52 pm
Risk considerations? Is it only about returns?
Emerging markets are great if you know something about the market(s). If you are a typical American, EMs are fraught with danger. Best investment is probably to spend the time and effort to learn. Oh, and go long garlic. We will soon be paying out debt service to Chinese in garlic.
Garlic becomes China’s top asset
http://news.bbc.co.uk/2/hi/business/8381984.stm
December 2nd, 2009 at 3:56 pm
Michael Panzer said
However, based on the following chart, some might argue that emerging equity markets are the true safe haven.
reply (BTW, I read your column)
——————————————
Sucker. Why not just buy real estate in BRIC , especially in one of China’s new empty cities. Good place to get away from it all in every way possible. They’re booming. Better buy now before everyone gets in. Unless you act NOW, you might actually have a neighbor to contend with. Maybe you should buy a block or three; I’m sure you would get a first mover discount. Just think, you could go outside and walk around naked and nobody would notice.
Yes, emerging markets are great, if you forget that they usually rise 3x of established markets, and usually fall 3x in relation to established markets. Buy at the top and impress your friends. China will probably keep their pump going a while longer. Maybe you can syndicate the purchase and charge 2% as a management fee. Why let the sales pros have all the fun? China will probably swear your plot is golden for a decade. No Madoff problems for you.
December 2nd, 2009 at 4:04 pm
MRe gan Says:
December 2nd, 2009 at 3:52 pm
Garlic becomes China’s top asset
reply:
—————-
You think too small. Think real estate. Think ‘time share’. All China needs are rejuvenation springs that deliver eternal youth, all within their new rejuvenation cities they just built. Now that’s something to leverage up over.
December 2nd, 2009 at 4:37 pm
I think those buying Gold (after a crisis, rather than before it) aren’t expecting the market to return to buying risk assets any time soon…(which of course, if enough people panic/buy gold/etc, it may well do)
December 2nd, 2009 at 4:44 pm
@MRegan: Great. With the vampire craze reaching a zenith in Scamerica, perfect timing to make some hay off of the garlic bubble.
December 2nd, 2009 at 4:54 pm
the S&P 500 financials since 3/9
what a fucking show- all make believe- backed by QE and ZIRP- a set-up and a scam on the whole country-
only shows what the stock market is not to be trusted- a medicine show w/ zero credibility-
tread carefully
December 2nd, 2009 at 5:05 pm
So anyway, how’s China going to recoup the billions they spent throwing magic flowers over the waters? You have empty cities. You have loans flowing out an ass with no sphincter muscles, powered by a diet of high fiber, wood chips, and the medicine you take the night before a colonosocopy. Free fertilizer for all. The Chinese know how to throw a party,
I suspect they’re waiting for the American consumer to get another refi and buy the shit out of whatever they are selling so they can put new and unused capacity to work along with the idle capacity remaining that hasn’t been rebuilt yet.
Does China have a system that expects debts to be repaid, or are they willing to declare power to the people and forgive all debts to those who can’t repay? Not my problem.
Yes, this is a hell of a market to put your hard earned savings into. Emerging markets: YES! Long term debt: YES! Free money. Right here.
December 2nd, 2009 at 5:11 pm
Crisis implies Fed provides liquidity punch bowl. Liquidity distorts risk perceptions. Furthermore, in this case very little of the liquidity is going into the real sector. So it seeks financial and other outlets. As long as the Fed is anticipated to keep the punch bowl reasonably full, EM will make sense to many and liquidity will flow there.
December 2nd, 2009 at 5:31 pm
Mannwich- they are distracting us with brooding hermaphroditic vampires so we won’t notice the growing threat of cannibals (and their follow-on, pirate cannibals, very nasty).
EMs- here’s a case. CPFL (CPL- ADR) is being soft sold, right? So some stock hawkers have an analyst produce a piece on the company and blablabla FCF bla stable dividend bla, major capex bladiddy-bla…blaaaah.
No mention of serious problems at some of their ‘experimental’ operations (Irmaos Baldin), no mention of debt levels, investment thesis based on best case scenario for 2010 gdp in Brasil etc, etc. So, some guy who has never heard of o estado do Paraná thinks to himself, yeah this analyst is probably right, CPFL can grow its FCF in 2010 by 35% even though they intend on spending 580 mill USD on transmission buildout and maintenance (CPFL at present is an amalgam of companies absorbed) and their 3q09 earnings were down 15.8% (a fact the analyst also elided…) and while we’re talking about maintenance costs- monstrous unknown! And they want to build generation capacity, wonderful…anybody knows current market cost of greenfielding 1Mw in Brasil and environs? If you do, you know something that not even Mestre Didi knows. And I didn’t even mention currency risk, or an end to the cycle of consumer credit expansion- look up furniture retailers in Brazil and read up on how they are trying to manage consumer credit issues. Como se diz ‘no more soup for you!’ no portugues?
December 2nd, 2009 at 5:41 pm
mregan – but but – no, not Brazil, I can’t believe it. The EM’s are supposed to lead us OUT of this mess!
Sorry, i never get tired of saying that :P
December 2nd, 2009 at 6:35 pm
Under normal circumstances, emerging markets would be a good bet. But even they’re blowing bubbles which will pop eventually not to be confused with the ones the industrialized world is blowing for them with their loose monetary policies. No, more people are beginning to see it for what it is..even central banks. Gold is going higher…
December 2nd, 2009 at 6:42 pm
“The efforts to block Bernanke’s confirmation are getting some traction.”- Naked Capitalism
http://www.nakedcapitalism.com/2009/12/progress-on-no-on-bernanke-including-sanders-putting-hold-on-confirmation.html
Also- Tell your Senator NO on Bernanke- links to your Senators below-
http://www.nakedcapitalism.com/2009/11/tell-your-senator-no-on-bernanke.html
December 2nd, 2009 at 6:43 pm
This shouldn’t be a surprise. First consider his set up- “after a crisis strikes”… There is not a post crisis rally out that that wasn’t first led by the highest beta asset class. It is just a play on the age old thought that rallies start in small cap and roll up to large cap as it expands and extends… There isn’t anything offensive about this and it has nothing to do with much more than human tendency to grab the biggest bang for the buck when trying to “make it back”
I think it is a bit of a misguided leap to make the “safe haven” statement, but I think there was a bit of an attempt on humor there…
December 2nd, 2009 at 7:19 pm
So called experets have said another bubble could be brewing in China .. No one sees to be talking about Panama City, Panama at all. The last time I was there the building of condos was insane.. surely a bubble waiting to pop.. anyone agree?
December 2nd, 2009 at 7:24 pm
It’ll be different next time.
December 2nd, 2009 at 7:26 pm
@Jas-
Michael Panzner definitely has a sense of humor,
and, he also poses interesting questions
and, with you, good point, regardless of motivation, but, the samples are all volatile – note financials, since March, suspend mark-to-market, QE, etc…, voila!
December 2nd, 2009 at 7:52 pm
Thought this was interesting. Go Bernie! In the very least, some good theater. I want my money’s worth.
http://www.zerohedge.com/article/senator-sanders-place-hold-bernanke-reconfirmation-chairman-will-need-60-senate-votes-overri
December 2nd, 2009 at 8:28 pm
i’m glad you posted that manny- check out my 6:42 post-
i already sent an email to my Senator – Mark Warner- who luckily is on the Senate Banking Committee-
if you are inclined-
http://stopbailoutben.com/
December 2nd, 2009 at 8:57 pm
@Mannwich Says:
December 2nd, 2009 at 7:52 pm
Thought this was interesting. Go Bernie! In the very least, some good theater. I want my money’s worth.
————
Couldn’t agree with you More….It’s great to see a “good Bernie” out there. Theater or not…we need PUSH BACK wherever and whoever can do it!
I’m watching him, too. And, sending him support…even way down here where I live in the “heart of the beast.”
December 2nd, 2009 at 10:50 pm
Hey MRegan
Stop giving away our research on CPL. I bet we paid good money for that…
And Ron Paul might be nuts but he is like a dog on a bone with this one and I hope he can get the Fed audit pushed through.
December 3rd, 2009 at 5:10 pm
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December 4th, 2009 at 4:05 am
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