Global Economic Quiet Ahead of the Post U.S. Election Storm
Economics / Recession 2013 Oct 17, 2012 - 12:27 PM GMTBy: Graham_Summers
While the media world is abuzz with last night’s Presidential debate, I’d like to cut through the noise and present you with two truly staggering facts that need to be kept in mind as the backdrop for the US Presidential Election
Fact #1: EU leaders have stated point blank that they were asked to keep things quiet until after the election.
Regardless of your party affiliation, social views or the like, we have to ask ourselves “what was promised in return?”
If you’ve been reading me for some time, you know by now that the EU is in massive trouble. Spain is currently drawing over €400 billion from the ECB.
Let’s put this number in perspective… in June before Spain requested a €100 billion bailout, the country was drawing only €300 billion from the ECB.
Since that time and now, the ECB has promised to provide unlimited bond buying… and even Germany has indicated it would be open to some sort of a Spanish bailout…
And yet, Spain is now borrowing even MORE than it was in June.
This is not progress in any way… if anything it indicates that things are worsening in the EU’s financial system at a staggering pace. The powers that be are keeping things calm until after the election… at which time there will be absolute hell to pay.
And we Americans are going to be on the hook in one form or another. Something was promised in exchange for the EU keeping things quiet. And we won’t find out what it is until after November 6
Fact #2: China is facing a severe downturn if not outright collapse.
As I’ve stated many times before, the China economic “miracle” is in fact one colossal Government funded fraud. While the media attempts to spin China as still growing, executives over there have stated that in fact things are far worse than is publicly known.
Many economists expect the Chinese government to announce Thursday that economic growth in the third quarter was barely short of the official target of 7.5 percent. But Chinese business executives said that the reality was worse for many companies selling in the domestic market, leaving considerable room for a rebound.
“All industries are going down, but why aren’t the official statistics going down?” asked Bob Wang, the sales manager of Kralle Tools, a manufacturer in Wenzhou, an eastern city, that makes circular saw blades for lumber mills.
He said he believed that government officials had been underestimating the extent of China’s slowdown to avoid losing face.
http://www.nytimes.com/2012/10/16/business/global/at-trade-fair-chinese-exporters-a-bit-more-optimistic.html?pagewanted=2&_r=2
So… expect the news out of China to get worse and worse once the election is over. How would the world react to news that the “miracle” which supposedly pulled the globe out of recession is in fact collapsing?
Not well.
Europe and China combined account for 34% of the world’s GDP. Throw in the US which has re-entered a recession and 55% of the globe’s GDP is in contraction.
And everyone is waiting on November 6 to see how this will pan out.
For that reason, I’m putting together a One Time Special Report, detailing exactly what a second term for Obama or a Romney Presidency would mean for the US economy, the US Fed, and ultimately the markets.
Not only that, but I’m outlining what investments would perform best under each candidate based on their policies and plans.
All told we’re talking about over 20-pages of intense, hard hitting research to make sure you’ve got all your bases covered going forward.
Those investors looking for actionable investment ideas could also consider our Private Wealth Advisory newsletter: a bi-weekly detailed investment advisory service that distills the most important geopolitical, economic, and financial developments in the markets into concise investment strategies for individual investors.
To learn more about Private Wealth Advisory… and how it can help you navigate the markets successfully…Graham Summers
Chief Market Strategist
Good Investing!
PS. If you’re getting worried about the future of the stock market and have yet to take steps to prepare for the Second Round of the Financial Crisis… I highly suggest you download my FREE Special Report specifying exactly how to prepare for what’s to come.
I call it The Financial Crisis “Round Two” Survival Kit. And its 17 pages contain a wealth of information about portfolio protection, which investments to own and how to take out Catastrophe Insurance on the stock market (this “insurance” paid out triple digit gains in the Autumn of 2008).
Again, this is all 100% FREE. To pick up your copy today, got to http://www.gainspainscapital.com and click on FREE REPORTS.
Graham also writes Private Wealth Advisory, a monthly investment advisory focusing on the most lucrative investment opportunities the financial markets have to offer. Graham understands the big picture from both a macro-economic and capital in/outflow perspective. He translates his understanding into finding trends and undervalued investment opportunities months before the markets catch on: the Private Wealth Advisory portfolio has outperformed the S&P 500 three of the last five years, including a 7% return in 2008 vs. a 37% loss for the S&P 500.
Previously, Graham worked as a Senior Financial Analyst covering global markets for several investment firms in the Mid-Atlantic region. He’s lived and performed research in Europe, Asia, the Middle East, and the United States.
© 2012 Copyright Graham Summers - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.
Graham Summers Archive |
© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.
