Making the Cyclical Long Case for Chinese Equities

Making the Cyclical Long Case for Chinese Equities

Quick thought exercise: ownership of what asset is more anathematic than any other at the moment? Chinese equities!  You can’t touch em’ with a 10′ pole.  Can you name a single reason why you or anybody else should own them? This…...

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Updated EM Secular Bear Analog

Updated EM Secular Bear Analog

Here’s an updated look at the EM secular bear analog. Recent, plodding strength in EM is consistent with how both of the DJI’s secular bears acted in this area of their own respective secular bear cycles. Here’s the EM plot…...

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India: Best-Looking Equity Market in the World?

India: Best-Looking Equity Market in the World?

Below I plot the Bombay Sensex (BSE) Index going back to 1980 on the left, and 2001 on the right.  The long-term view reveals that the BSE has performed excellently over time.  It also reveals that it tends to make…...

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Global Macro Round-Up

Global Macro Round-Up

FX drives everything, so ongoing weakness in the USD vs. CNY is one of the most fascinating things going on in the world right now, especially given US and China trade talks are specifically addressing this issue.  USDCNY is currently testing…...

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Turkish Equities Are Very Attractive

Turkish Equities Are Very Attractive

Below I graph the Istanbul 100 in local currency terms.  Note the 2013-2016 consolidation at new all-time highs, the break-out and rally through 2017 and then 2018’s big sell-off to retest the break-out zone as new support.  Atop this new…...

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A Rare and Compelling EM Equity Long Amid Widespread Global Asset Class Carnage

A Rare and Compelling EM Equity Long Amid Widespread Global Asset Class Carnage

In the first chart below I plot the ratio of the Bovespa Total Return Index (IBOV) vs. the SPX Total Return Index.  The ratio appears to be staging a clean, noteworthy break above falling resistance that’s been in place since…...

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Approaching a Cyclical Low in EM Equities

Approaching a Cyclical Low in EM Equities

For some time I’ve maintained the view that since peaking in 2007, EM equities have been in a secular bear akin to the two witnessed on the DJI from 1906-1925 and 1966-1985.  That said, as secular bears go, such cycles…...

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LONG-TERM RELATIVE RATIO CHARTS – Global Composites

LONG-TERM RELATIVE RATIO CHARTS – Global Composites

Beginning with this post I began showing the relative ratios of all US equity industries vs. the SPX across their entire history.  Today, I switch gears and show ratios of major global composites vs. the SPX, mostly non-US ones.  This will help spell out where…...

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It Can Get Worse for China

It Can Get Worse for China

Many of the research services I subscribe to were suggesting with increasing frequency as the summer wore on, and now fall, that I needed to own Chinese equities given how oversold they’ve become. However, in my view, they’re still nowhere…...

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Spread Between USD Gains & EM/SPX Losses at Historic Extremes

Spread Between USD Gains & EM/SPX Losses at Historic Extremes

As of month-end Sep-18, the USD (via DXY) had appreciated 21% over the trailing seven years while the ratio of EM equities vs. the SPX had declined 54% (seven years ago is where USD bottoms, commodities and EM/SPX generally peak).  This…...

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