DJIA and USDJPY: Is this correlation telling us something?

Posted by Jack Crooks: Black Swan Capital

on Monday, 02 April 2012 09:57

Interesting how tight this correlation has become lately.  I have removed the labels to allow you to focus on the visual only at first look. Can you name these two price series? 

040212 dji jy-resized-600.jpg

If you said Dow Jones Industrial Average and Japanese yen, you nailed it!  Below, DJIA is in black (right scale), the USD-Japanese yen in blue (left scale): 

040212 dji jy scaled-resized-600.jpg

Now take a look at the same relationship, around the same time of year back in 2011.  Back then, USD-JPY peaked in early April and led US stocks lower; eventually dragging the Dow down about 2000 points into September 2011 where it bottomed:  

040212 dji jy scaled long-resized-600.jpg

You may be asking: Well, what about 2010?  Well, we saw a similar pattern back in 2010 also! USD/JPY topped in early May, the market topped in late April, both moved sharply lower together:    

Just saying ... stay tuned!

“I grieved to think how brief the dream of the human intellect had been. It had committed suicide. It had set itself steadfastly towards comfort and ease, a balanced society with security and permanency as its watchword, it had attained its hopesto come to this at last. Once, life and property must have reached almost absolute safety. The rich had been assured of his wealth and comfort, the toiler assured of his life and work. No doubt in that perfect world there had been no unemployed problem, no social question left unsolved. And a great quiet had followed. It is a law of nature we overlook, that intellectual versatility is the compensation for change, danger, and trouble. An animal perfectly in harmony with its environment is a perfect mechanism. Nature never appeals to intelligence until habit and instinct are useless. There is no intelligence where there is no change and no need of change. Only those animals partake of intelligence that have to meet a huge variety of needs and dangers.”

- H.G. Wells, The Time Machine (1895)

Gold & Precious Metals

Gold's Real Price & the Investment Case for the Miners

Posted by BiiwiiBlog via 321Gold.com

on Monday, 02 April 2012 06:37

As the HUI index of premier gold miners continues to chop and grind its way through ongoing correction, the idea for those who understand that this unique sector of the stock market stands to gain during phases of economic contraction, is to survive. The idea is to remain strong (and by strong I mean have cash to exploit the intensifying value proposition) and be ready for opportunity, which is likely to present itself to nearly the extreme witnessed in Q4, 2008.

Read full article here

Timing & trends

Central Banks Stockpiling Gold & Governments Hoarding Oil

Posted by King World News

on Monday, 02 April 2012 06:33

With gold and silver set up for a big move this week, today King World News interviewed 40 year veteran, Robert Fitzwilson.  Fitzwilson is founder of The Portola Group, one of the premier boutique firms in the Unites States.  He told KWN that investors need to accumulate key assets while they remain undervalued.  Fitzwilson also said gold, silver and oil are being hoarded by a combination of central banks and governments.  Here is what Fitzwilson had to say:  “It is critical that people distinguish between price and value.  As prices fall and ‘utility’ stays the same, that is what creates greater value.  In the case of oil, gold and silver, not only is the utility holding steady, but it is actually rising.”

Read full article here


Stocks & Equities

The Singapore Stock Market is the World's Biggest Bargain

Posted by Martin Hutchinson

on Monday, 02 April 2012 05:14

After all, its economy is in fine shape, and is growing faster than any of the major Western economies.

In fact, with its GDP per capita estimated at $50,700, Singapore is now richer than the United States.

It's all proof that as the world's leading trade entrepot, Singapore is aggressively moving up the global value chain as its citizens become richer and better educated.

And unlike the US, Singapore's recovery from the 2008-09 recession was rapid, with 14% growth in 2010.

Since then, it has entered a mini-recession, with GDP declining at a 2.5% annual rate in the fourth quarter of 2011. Still, overall growth in 2011 was a solid 4.8%, and the country is expected to grow by another 3.1% in 2012, according to the analysts at The Economist.

Inflation is a moderate problem, running around 5%, although it is expected to decline.

Yet the most impressive statistic about Singapore is its current account surplus of 18.4% of GDP; the budget is also in modest surplus, as it is most years.

Read full article here

Screen shot 2012-04-02 at 5.07.34 AM

Gold & Precious Metals

Find out what is next for Silver and Gold.

Posted by Show Update

on Saturday, 31 March 2012 08:11

silver bars 

David Morgan, Editor of The Silver Investor joins Michael on Saturday, March 31st. Listen live at www.cknw.com at 8:30am Pacific time or download the podcast above.

Find out what is next for Silver and Gold.


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