Sta Hungry Stay Foolish

Stay Hungry. Stay Foolish.

A blog by Leon Oudejans
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Volatility

Volatility

Various stock market indices have shown historic peaks last week (eg, AEX, S&P). The NASDAQ Composite reached its all-time high already on 12 February 2021. Nevertheless, the Chicago Board Options Exchange (CBOE) Volatility Index is far from its end of March 2020 peak. Why do historically high stock (and bond) prices, amidst a pandemic, not translate in...

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The dollar is our currency, but your problem (2)

Some twenty years ago, an investment banker - overseeing the restructuring of a company - said the following words to me: Small debt is the problem of the debtor; high debt is the problem of the bankers (or creditors). History has proven the validity of his view (eg, Greek government-debt crisis of 2007-2008, the various Argentine debt restructurings). The various...

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Why zero interest rates might lead to currency volatility (The Economist)

The Economist title: Why zero interest rates might lead to currency volatility The Economist subtitle: There is little scope for them to adjust to economic trouble. So something else must Date: 4 July 2020 "A generation of English cricket fans know the Aussies are loth to surrender a lead. For much of the past two decades, Australia has been a high interest-rate...

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USA embaces MMT. What could go wrong?

Former US president Obama is the first modern Democrat who left huge deficits. He had an excuse. Before Obama, Democrats were often the ones cleaning up the financial mess left by Republicans (eg, Bush tax cuts). Today, both parties believe in the Modern Monetary Theory (MMT), which argues that government budget deficits are solved by printing new money. Printing...

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IMF boss says global economy risks return of Great Depression (Guardian)

The Guardian title: IMF boss says global economy risks return of Great Depression Guardian subtitle: Kristalina Georgieva compares today with “roaring 1920s” and criticises UK wealth gap Date: 17 January 2020 "The head of the International Monetary Fund has warned that the global economy risks a return of the Great Depression, driven by inequality and financial...

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China may soon run its first annual current-account deficit in decades (Economist)

China may soon run its first annual current-account deficit in decades (Economist)

The Economist title: China may soon run its first annual current-account deficit in decades The Economist subtitle: The implications will be profound Date of publishing: 16 March 2019 "That china sells more to the world than it buys from it can seem like an immutable feature of the economic landscape. Every year for a quarter of a century China has run a...

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