Tag Archives: france

Our Two Cents – Week of 5/7/12

After watching I’ll Have Another race for the crown in the 138th Kentucky Derby last weekend, we’ll have another pass at our biggest headlines in the financial markets.

In the U.S., the economy added 115,000 jobs in April as the unemployment rate dropped to 8.1 percent from 8.2 percent. While the April figures registered less than initially forecast, economists said there wasn’t a reason to panic yet because the warmer winter months could have encouraged employers to start their spring hiring early. The private sector posted a gain of 119,000 jobs, according to ADP.

In the eurozone, France and Greece held their elections. French voters elected Francois Hollande, who is a champion of government stimulus programs, after he campaigned on the need for more growth-generating economic policies and less dependence on austerity. Greece’s election caused more uncertainty in the eurozone as voters leaned toward extremist parties, making it difficult to form another government that would support the country’s rescue package. As a result, the nation may hold another election in the next couple of months. Additionally, Spain announced its decision to help its banks by presenting measures to the banking industry. Officials said they would not rule out lending or introduce public money into the banking sector if necessary. For the eurozone’s jobs, high unemployment continued to rock nations as the 17 euro-using countries faced an unemployment rate of 10.9 percent.

For alternatives investments, hedge funds increased slightly in April, with the HFRX Global Hedge Fund Index reporting a 0.12-percent gain. The UCITS hedge fund assets under management increased in Q1 from 113 million euros to 120 million euros, a jump of 6.2 percent.

 

 

-------

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

­­Our Two Cents – Week of 1/16/12

While we saw Tom Brady lead the New England Patriots to an outstanding playoff victory, we watched world leaders attempt to continue restoring economic confidence through consumer spending, market performance and fiscal activism.

In the U.S., economic optimism continues to rise as America displays more signs of employment and consumer confidence. The National Retail Federation has predicted that U.S. retail rates will growth 3.4 percent to $2.53 trillion in 2012. NRF President Matthew Shay said Americans should be confident about consumer spending—“Our 2012 forecast is a vote of confidence in the retail industry and our ability to succeed even in a challenging economy. Over the last 18 months, retailers have been on the forefront of the economic recovery—creating jobs, encouraging consumer spending, and investing in America.” Additionally, U.S. retail Forex capital grew by $3 million in November 2011. Though the growth is surprisingly smaller than October, which grew by 30 million, experts believe lower volatility and the year-end slowdown might have contributed to the diminished growth.

Throughout the world, last week began with booming markets. The Italian market increased more than 2 percent, and France’s CAC-40 Index posted a bump of a little more than 1 percent. Even one of the weakest world markets—the Shanghai Composite—jumped more than 2 percent. Unfortunately for Europe, market confidence reversed by week’s end. Ratings services Standard & Poor’s downgraded credit ratings of nine countries—including Italy and France—as political and financial leaders continue to devise solutions to the euro crisis. The Jan. 13 downgrade resulted from the December warning that S&P might decrease credit ratings of 17 nations because politicians had been moving too slowly with reforms for the crisis. As a result of the news, European leaders have vowed to focus on “progress” to restore economic growth. Italian Prime Minister Mario Monti and European Council President Herman Van Rompuy met in Rome Jan. 16 to discuss economic restoration. Monti said S&P applauded Italy’s fiscal acts, and Van Rompuy said he believed leaders should refocus their aims by establishing “sustained, committed” efforts. Southeast from Italy in Greece, officials and residents discussed a possible return to the drachma if the country can’t save its membership in the euro zone. According to polls, nearly 80 percent of Greeks say they want to stick with the euro and avoid reinstituting the country’s former currency. Prime Minister Lucas Papademos has vowed to do whatever it takes to keep his nation in the euro zone.

 

 

-------

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

Major activities in the euro zone economic crisis, including proposed amendments from European leaders and austerity packages from Italy, topped our transaction of the biggest currency markets headlines.

France and Germany spearheaded negotiations about new fiscal plans for the 17-member euro zone, issuing proposed amendments to Europe’s governing treaties to provide better economic governance to nations. Meeting at Élysée Palace in France, French President Nicolas Sarkozy and German Chancellor Angela Merkel prepared proposals they would deliver to the full European Union Dec. 8. Some proposed amendments include automatic penalties for countries that exceed European deficit limits as well as the creation of a monetary fund for Europe. Sarkozy said he hoped the treaty changes would be ready for ratification as early as March 2012.

On Dec. 4, Italian Prime Minister Mario Monti unveiled for his country a 30-billion euro austerity package, which includes raising taxes and the pension age, in hopes of harnessing the euro zone crisis. He said the package was painful, but important, as he also renounced his own salary as prime minister and economy minister. Late last week, Sarkozy spoke to French voters about the economic slowdown and rising unemployment. His speech came on the heels of remarks from European Commissioner for Economic and Monetary Affairs Olli Rehn about the euro zone entering a “crucial” 10-day period. During this time, nations must focus on building “convincing” financial protections and tightening economic governance, as Sarkozy and Merkel have outlined.

While Italy, France and Germany devised reforms, Greeks returned to simpler ways of life. Because of Greece’s debt, many inhabitants have defaulted to bartering. In the small fishing village of Volos, which is about 200 miles north of Athens, many residents have been buying and selling goods from each other and vowing to neighbors during harsh economic times. In the United Kingdom, the British pound sterling emerged as a safe haven for investing because demands for British government bonds rose. Investors also turned to the pound sterling because it was up 2.1 percent against the euro since early September.

Across the Atlantic, the United States saw some signs of hope for jobs. According to the U.S. Labor Department, unemployment dropped to 8.6 percent. In November, 120,000 jobs were added, up from 100,000 from October. The good news was that the American economy grew, even though conditions abroad waned. But what weren’t waning were the wallets of some Connecticut hedge fund managers who won a $254-million Powerball drawing. The three winners pocketed the state’s biggest lottery ever and have donated some of the money to people in need.

 

 

-------

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

Italian reforms, British backlash, German refusal and French strength made headlines last week. We hedged our bets on the best news in the currency market, and here’s how we made out.

All eyes were on Europe again this past week as Italy’s premier-designate Mario Monti stepped into the spotlight to help right Italy’s fiscal flounders. Monti faced a monumental task of galvanizing the country’s electorate and politicians to accept crucial reforms that would stop Italy’s sinking economy. This sparked some fears for economists because Italy’s economy is the eighth largest in the world and if not rightly handled could cause global reverberations. While Monti pushed reforms, former Prime Minister Silvio Berlusconi hit the recording studio. The once-battled politician is releasing a CD of love songs, where he croons with Mariano Apicella, a Neapolitan ballad singer he has collaborated with for previous albums. In England, Britain saw rising unemployment at 8.3 percent for September, but that didn’t stop Germany from blasting the U.K. to start helping the euro zone. Volker Kauder, parliamentary leader of the Christian Democratic Union and a senior member of Chancellor Angela Merkel’s party, blasted the British government, saying that “Britain also carries responsibility for making Europe a success. Only being after their own benefit and refusing to contribute is not the message we’re letting the British get away with.” Germany said it wasn’t planning to pay for the bulk of spending from other countries because it wants a unified continent. However, more core European nations were starting to feel the heat of the euro zone as AAA nations such as France were under pressure for their financial strength—a characteristic that’s no longer taken for granted. France’s cost of borrowing increased more than a half percentage point, and Austria’s spread between its 10-year bonds and benchmark German Bunds hit euro-era highs. Dutch and Finnish spreads have also seen their highest spreads since 2009, generating thoughts about the direction of a new Europe.

In the U.S., some good news about jobs. The number of unemployment benefits fell last week to its lowest level since early April, showing signs that hiring may be rebounding. The Occupy movements in cities such as Los Angeles, Boston and Las Vegas saw for the most part peaceful protests last week, but throngs of demonstrators in New York City took to the New York Stock Exchange and subways to raise concerns about corporate excess. In the markets themselves, hedge funds posted gains of 2.04 percent in October, marking some optimism after two difficult months. We conclude with a look at spending for Black Friday as shoppers are expected to gobble up purchases Nov. 25. According to the National Retail Federation, the average American spent $365.34 on Black Friday in 2010 with overall sales calculating $45 billion.

 

 

-------

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

In the United States this week, we were twisting and shouting like a 1960s disco track, while Italy wasn’t feeling the amore from financial officials and Greece wasn’t succeeding in its Olympic financial fiasco. Here are the top posts from last week:

The markets were expecting the Federal Reserve to announce Operation Twist, in which the Fed would sell short-dated Treasury debt and use the proceeds to buy long bonds. The Fed initiated a similar act in the 1960s, but with today’s numerous economic uncertainties – high unemployment rates and consumer debt – this small step is unlikely to create much spending. While America grappled with its monetary quandaries, Europe tried sorting its financial flounders. Standard & Poor downgraded Italy’s credit rating, saying arrivederci to the country’s A+ grade and ciao to its A mark with a negative outlook. Across the Adriatic Sea, Greece was also continuing to experience its continued economic pounding as it straddled the brink of default. The European Union

commissioner has said “the EU will not abandon Greece or let it default uncontrollably.” France is planning a 10 to 15 billion euro recapitalization plan for five top banks combating the debt crisis, causing a formal denial from financial ministries. The ministries said the government held discussions with leading banks about their state of heath, but denied bailout offers. One top financial executive said “French banks have a sufficient capital base compared to other European banks and they are making profits.” Also in Europe, the Swiss bank UBS’s chief executive resigned Sept. 24 after a $2.3 billion rogue trading loss. Oswald Greubel’s resignation ends days of speculation about whether or not he would retain his top post among one of the biggest scandals to hit the Swiss bank.

-------

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.

From the aftermath of the debt ceiling crisis and the S&P downgrade to the release of the latest unemployment numbers, we’ve been busy counting the latest stories in the world currency markets. Check out our top picks of the week:

News on the S&P downgrade made headlines and many wonder what’s next for the U.S. economy. After a tumultuous week in the stock market, the CBOE Market Volatility Index rose 26 percent, marking a 29-month high. Some investors are stressing a need for new currencies and stock exchanges either in the form of a world economic system managed by the International Monetary Fund or cyber currencies. Meanwhile, gold futures soared due to the rating cut, reaching a record $1,697.70 an ounce. The U.S. Securities and Exchange Commission launched an investigation last week, asking Standard & Poor’s to provide information on employees who were informed of the downgrade decision before it was announced. Concern has once again risen for the European economic crisis as falling shares in French banks prompted finance and budget officials to search for new ways to trim public deficit. Employment numbers released last week show that U.S. unemployment benefits have dropped to a four-month low. These statistics have already impacted the currency markets; both the USD/JPY and USD/CHF have increased, which “releases the hot air” out of the franc and the yen. Japan continues to face problems with the rising yen, as the currency’s increase against the U.S. dollar leads to a cut in Japan’s export sales.

 

-------

Be sure to read the full risk disclosure before trading Forex. Please note that Forex trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved before trading. Performance, strategies and charts shown are not necessarily predictive of any particular result. And, as always, past performance is no indication of future results. Investor returns may vary from Trade Leader returns based on slippage, fees, broker spreads, volatility or other market conditions.