FS Staff's picture

With mounting geopolitical tension, lack of opportunities overseas, and the relative attractiveness of U.S. markets, foreign investors are bidding up the price of U.S. stocks and the dollar, which is putting increasing pressure on gold, oil, and commodities, says Martin Armstrong.

FS Staff's picture

Between Ukraine and ISIS, 2014 has been a year marked by geopolitical tension. Yet, contrary to intuition, market volatility has continued to trend downward along with the price of gold and oil, while stocks continue to hit new all-time highs. Why?

FS Staff's picture

With ongoing problems in Europe and U.S. valuations looking stretched, well-known money manager Louis-Vincent Gave thinks Asia has the most going for it right now. Here are some excerpts of his recent interview.

Chris Puplava's picture

Should the USD break out from its 2005 to present bearish trend, we should see some significant developments in inter-market relationships. For starters, the relative performance of U.S. stocks relative to the MSCI World Stock Index Excluding the U.S. shows a strong correlation to the USD Index.

Chris Puplava's picture

Once breaking through its eight year declining trend from 1989 to 1997, the dollar rallied 50% until finally peaking with the tech bubble. Should the USD break out this time around, it is quite likely to have a strong bullish run going forward.

Brian Pretti CFA's picture

All the chatter from the Fed about interest rate levels, forward guidance, tapering, etc. is largely noise. In a consumption driven economy, wage growth is the accelerant of consumption growth, not rising equity and real estate prices through the illusory "wealth effect".

Paul Kasriel's picture

I subscribe to the tenet espoused by the late Professor Milton Friedman that inflation is a monetary phenomenon. When I speak of inflation, I include not only the behavior of prices of goods and services but also the behavior of the prices of assets.

Cris Sheridan's picture

A handful of readers wrote yesterday: “Corporate profits are rolling over!”, “Cris, it’s time to get the word out.” It appears the source of all the alarm was an article that recently appeared at Business Insider, “Wall Street Declares the Great Profit Margin Boom Is Finally Over.”

Bill Fleckenstein's picture

Mario Draghi came as close to the “full Monty” as he possibly could by cutting interest rates 10 basis points to a measly five basis points, and increasing the negative deposit facility rate to -20 basis points. In addition, he promised to begin buying about $400 billion worth of asset-backed securities in about a month.

Chris Puplava's picture

Given the prior inflationary move seen earlier in the year, it is likely we should expect a moderation in economic momentum that has been building since Q1 of this year. Should growth moderate we are likely to see more economic releases surprise to the downside.