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Category: Macro

Betting on US defense ?>

Betting on US defense

As we all knew, Trump wants to hike the defense budget to $639B from $587B and, as global macro investor, I’m trying to identify who’s going to earn that money. Right now I’m analizing the industry to see which one of the companies that composes that will increse more its contracts. But, to sa something clear, I can say that I won’t probabl bet on aeronautics companies at the moment as NASA has seen that part of its budget cut…

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Looking for 2017 macro opportunities ?>

Looking for 2017 macro opportunities

During this week I have opened 2 long positions, in gold and in the EUR/USD (I’m going to explain wh in this entry). I’m also looking for a long in the GBP in the mid/long term due to the growing inflation in the UK and because we all know that the BoE traget is a 2% (and, if inflation keeps going to this rythm, we’ll see an aprox 2.8% at the end of the year). I also think that Carney…

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Long USD ?>

Long USD

I’ll open a long in the USD as by macro I expect a rate hike this month or early next year because of the following things: 1- Inflation is at 1.6%, close to the 2% that the FED has stablished as a perfect inflation rate. Recently OPEC has agreed (or at least they are in advanced talks about it) to cut oil production, so inflation will boost as oil prices are going up because of the lower production. 2- At…

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Short EUR/USD ?>

Short EUR/USD

During this week we have seen how the ECB president (Mario Draghi) has said that he has no hurry in diminishing its QE in the Eurozone. After saying that, the Euro lost some strenght against other currencies as this it’s seen (despite saying that the Eurozone economy is healthy) as a lack of economic strenght in the Euro area, as it is facing right now, two major concerns: The Deutsche Bank problem, that is affecting the EU right now, as…

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Stock picking in the UK ?>

Stock picking in the UK

Well, we’ve seen this morning something that even markets thought that was impossible, UK citizens have decided to leave the EU. I wrote about it before and I recommended hedging your positions, and I can say it has worked (at least for me). Volatility as been really really high, even higher than I expected to be honest. Now, what am I going to do? Well, the thing is simple, I will wait until the sell-off stabilizes, and until that happens,…

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Mid year market overview ?>

Mid year market overview

We have recently seen how US stock markets have reached an historic top. In my opinion that has been provoked by the lack of greater returns in any other safer asset. We can see that in many economies interest rates are below zero, in an effort by central banks to┬áincrease inflation. That has not been effective as we can see in the Eurozone for example. Keeping interest rates below zero has also had an impact in fixed income returns, that…

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Why a ‘Brexit’ would be a bad business for both the UK and EU ?>

Why a ‘Brexit’ would be a bad business for both the UK and EU

The world is worried about a ‘Brexit’, that will take place this June 23, when Britons are going to decide if the want to remain in the European Union or leave it via a referendum. As can be seen in the following picture (a chart created by Bloomberg), the results are going to be really close and it seems that those people who are undecided are the ones who are going to decide the final result.   But what is…

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Why I’m betting on agriculture and farming for the long run ?>

Why I’m betting on agriculture and farming for the long run

According to the Population Reference Bureau (PRB) the world population reached 7.3 billion in 2015, being China and India the most populated countries in the world with 1.372 and 1.314 billion respectively. As we can see in the chart above, 9/10 of the most populated countries have a lower than the $15,030 average gross national income per capita, so we can assume that those countries are not developed and that the main part of its population has low income. We…

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Draghi needs a new weapon ?>

Draghi needs a new weapon

In his last speech, Mario Draghi said that the policy conducted by the ECB right now (they are conducting a negative interest rates and QE policy) is working, but he asked for more time to see the results. Actually, the ECB is buying around 80 billion euros a month in order to try to increase inflation in the euro area while they keep interest rate in the negative area, that’s in the thin line between zero and negative growth. But,…

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