by Collinson FX
2008 Flashback Carl Evans and 2012 Olympic Silver medalist Peter Burling (NZL), the youngest crew to ever compete at an Olympics sailing in the first races of 2008 Olympic Regatta.
Collinson FX market Commentary: December 19, 2012
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The 'Santa Rally' continued with positive news from Europe and rising hopes in the Fiscal Cliff negotiations. In Europe, S&P raised the outlook raising Greek debt rating from Junk Bond status, clearly believing in the commitment of EU leaders.
The EUR rallied to 1.3225 and the GBP 1.6250 with the usual positive season sentiments flowing through markets. Most Politicians are off the stage and the lack of presence certainly raises positive market vibes. The sheer lack of faith in Politicians from both the left and right have reinforced the crumbling support of institutions that have built Western nations.
The entitlement society has dragged Western democracies into the toilet with debt overwhelming the viability of nations. In the US, the White House rejected the Boehner offer to raise taxes on those earning over $1 Million and allow Bush taxes to remain. Obama has not offered significant spending cuts that are the root of the crises. Remember these revenues and cuts are multiplied by 10 as they are talking about a ten year budgetary period.
Why not talk in multiple of 100 so the numbers can become even more meaningless and relevant. To put this in perspective....the US Government is more than $1 Trillion p.a.($10 Trillion 10 year) and they are proposing cuts of $100 Billion ($1 Trillion 10 year)! Keep in mind these cuts are not actual cuts but cuts to growth in expenditure already budgeted. This will not even slow the compounding growth of the deficit and debt that will overwhelm the nations finances in the short term.
Meanwhile the Christmas rally continues with the seasonal rally in equities. Commodities failed to respond to the Christmas spirit and remained steady. The AUD held 1.0530 and the KIWI 0.8425 with markets trading very thin volume over the holiday season. This is likely to continue until participants return in the New Year with any deal in the Fiscal Cliff negotiations likely to be marginal.
Jo Aleh (NZL) sailing in Race 8, Womens Laser Radial Championships
Collinson FX market Commentary: December 18, 2012
The last full trading week before Christmas promises to be light in trading volume with only major Eco-political events having an impact. Today stocks rallied after positive news from the Fiscal Cliff negotiations. Speaker Boehner has offered further considerations in form of a tax rise on those earning $1,000,000 plus.
Obama has not agreed but the continued bi-partisanship from the Republicans may force his hand. His form has offered precedence and has not always been in line with popular demand so expectations must be reserved with Democrats cocky after the recent election. Equities rallied on the developments and the currencies remained attracted to risk. The EUR traded 1.3150 with Merkel commenting on necessary structural reforms that must be addressed.
She spoke of the over generous welfare/entitlement societies that are drowning Western nations in debt. This sacred cow will be heavily resisted by the left but the simple fact of a fall in the number of tax payers does not allow such largesse. In the US, The Empire Manufacturing Survey continued to degenerate falling a further 8.1% but economic data was swamped by political negotiations.
The Santa Rally resumed with no fundamental moves expected this side of the New year apart from Fiscal Cliff developments. The AUD remained steady trading over 1.0500 and the KIWI 0.8400 reflecting the strong appetite for risk in the face of a devastated Big Dollar.
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