A lot of gold investors are disgruntled. The emotional pain involved in seeing ones gold holdings decline in value while stock and bond markets are reaching a phase of full-fledged exuberance proves to be too much for many. At such extremes, however, a reversal will be hefty. As markets become stretched far beyond their fair limits, a reversal will be deeper and take a greater toll on a majority o... »
The Longer It Takes, the More Dramatic the Reversal
June 13 2014
Olav Dirkmaat
Negative Deposit Rates in Europe: Unintended Consequences?
June 6 2014
Thursday was the most interesting day of the week as ECB president Draghi announced the central bank’s interest rate decision. Not only was the main refinancing rate cut with ten basis points to 0.15%, but, more interesting, the ECB decided that it will charge banks for depositing funds at the ECB. Deflation fears led to this historic policy change: the ECB is the first major central bank to... »
Olav Dirkmaat
Game Time: the European Elections
May 23 2014
Yesterday, both the Netherlands and Great Britain kicked off for the European elections. In the UK the anti-EU United Kingdom Independence Party (UKIP) made huge gains, acquiring between 25 and 30 percent of the votes (about 19 seats). In contrast, the Dutch election results were very fragmented,... »
Olav Dirkmaat
European Growth Horrendous: Politicians Blame the Weather, Again
May 16 2014
After writing extensively about the abysmal US Q1 GDP report two weeks ago ('It’s the Weather, Silly'), this week attention turned to Europe, as GDP figures over the first quarter were released. Although US growth was disappointing, euro zone growth was even weaker. Many countries actually had a declining GDP or came in below expectations. Only Germany surprised on the upside.... »
Olav Dirkmaat
