Global Macro Trading Journal

Quote from Specterx:

Not sure if I've mentioned this before, but I think there's an excellent secular buying opportunity in Greek stocks. The Athens General index is currently at 745 down from a year-2000 high of 6500 - down 88.5%. It's back to levels last seen in 1993.

Few weeks ago I took a small (1%) position in GREK, which covers only a subset of 20 stocks rather than the full ATG. It's so rare to see a developed-world (I mean I know it's Greece, but still) stock index beaten down so badly that I really want to boost my position to maybe 3%, as there's quite considerable potential upside - almost 1000% to recover the 2000/2007 highs. A fine return over twenty or so years, and that's not counting dividends. It could of course make only a fraction of that progress and still be a decent enough investment.

Risks that come to mind:

- Political: Nationalization/expropriation of foreign shareholders, or measures such as punitive taxes on foreign capital and capital controls. Seems possible, but Greece is still connected to Europe. As long as the EU and 'European Community' idea survive in some form with Greece as at least a peripheral member, I don't see them as too likely to go whole-hog down this path.

- Bankruptcy: 32.5% (as of Nov 25, it is likely lower now) by market cap of the FTSE 20 index on which GREK is based consists of banks and financial companies. It is entirely conceivable that these will go to zero with all shareholders wiped out.

- Hyperinflation: Greece returns to the Drachma and hyperinflation takes hold. However the real losses might actually be less in this scenario than if bank shareholders were wiped out (after all you own a share in the bank getting first access to the wheelbarrow loads of printed paper).

In short you have to be prepared to lose the whole investment and a 50% drawdown is very likely - which is one reason I haven't put any more out just yet.
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I talked about and research this last year and posted here. My conclusion was that if Greece drops out of the EUR then Greek stocks are a great buy(Ala Argentina) the day after. But buying before such thing is risky because the loss of a return to the drachma will be really large and it will be all upfront(70% overnight or so)

If I knew with high confidence they would not return to drachma I would probably allocate 3-4% of my portfolio on some Greek ETFs(Traded in europe, not the US one) on the 'buy when there is blood on the streets' dogma but I don't have that confidence
 
http://www.economonitor.com/nouriel/2012/03/07/greeces-private-creditors-are-the-lucky-ones/

Roubini seems correct here. Fiscal transfers in the form of official debt restructuring could be a potential solution for Greece so it stays in the EUR zone. I'm afraid the political issues of a large official writedown of the debt will prevent them from just accepting they will be mostly wiped out on their Greek debt. So they might keep doing it too little too late cuts(Taking the projected 120% by 2020 to 110%, then 100%, instead of just accepting massive writedowns and be done with the problem)
 
Quote from jj90:

Daal, while ralph is an ass most of the time, he also has a pretty good hit rate of his calls/links to research. I would assume you are familar with 'groupthink' as a phenomenon. At any rate, you know the old saying about : keep your friends close and your enemies closer?

My macro 2 cents is firmly in line with GOC. Data is positive even if it is ST data. While momemtum appears to be fading, the net result of Fed tightening may not be a selloff, it could mean an extended trading range in the indicies. I'm still reiterating my 70s repeat scenario since page 1 of this thread. If you are looking out 5+ years, go long stocks/comms. Under 5 years, be prepared for whipsaws, but unless SHTF (which you'll see the writing on the wall), this isn't 08' or anything close to it.

Edit: for actual plays im in or looking to initiate

Long PMs
Long bluechips or broad index ETF
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I appreciate different views and feedback. Have no problem with people disagreeing with me. I do have problem with extremely negative people who offends others for no reason and have huge egos, the guy is clearly mentally ill. He is the type of guy who will go to Tahiti, love it for a couple days, then start bitching about his bed or room service
 
Back at 100% long on HKD(Thinking of buying more though)
http://online.wsj.com/article/SB10001424052970204603004577268753111588304.html

I'm totally shocked he would say this, HKD immediately spiking. I'm shocked because he is doing that with the currency close to testing the band, this will force them to print money at the time they might not want to(Or maybe they do want to as monetary stimulus, though inflation is awfully right). Either way the R-R is out of whack here
 
To me there is a chance that he is just lying to get some of the voters pissed about inflation to vote for him. But the big thing is the closeness to the band, this is going to put them in a BOE type situation where keeping the band means creating economic outcomes they might not want to(More inflation, more property speculation)

My position is already 2x my networth and I might buy more so this could be the trade of my life
 
Quote from Specterx:

Sounds to me like somebody realized that creating market expectations for QE when no QE is likely forthcoming, would be a really bad idea - so now they're backpedaling.
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I'm thinking is a bit bizzare how people can bet on QE3 and think the economy will do just fine at the same time
 
Quote from Daal:

To me there is a chance that he is just lying to get some of the voters pissed about inflation to vote for him. But the big thing is the closeness to the band, this is going to put them in a BOE type situation where keeping the band means creating economic outcomes they might not want to(More inflation, more property speculation)

My position is already 2x my networth and I might buy more so this could be the trade of my life
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Also short USDHKD, but not of enough size to affect my speculative account or net worth. Will study to see if it's worth making a significant position. I'm assuming this Tang character has little if any shot at winning the election and the statement is to try and win some votes from the unwashed set.
 
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