The Global Capitalist

The week ending July 4th, 2008 was a bloodbath for world equity markets. Of the major indexes, only 2 were positive for the week overall: Austria, which gained 1%, and the Czech Republic which skyrocketed 7%, despite the financial stress in the system globally. The worst performing markets got crushed, with the Pacific Rim containing 6 of the bottom 10 performing equity markets for the week overall. Outside of Asia, Ireland, Brazil, and Chile were the worst performers, dropping between 6-8% each, with Turkey putting up the worst numbers, dropping an outrageous 10% in a single week. (more…)

The recent proposal by the Bush administration to freeze certain interest rates on sub-prime mortgages is one of the biggest steps away from capitalistic thought since the New Deal era. The proposition essentially will allow the government to hold interest rates below market value for those who are unable to afford them. Hugo Chavez would be proud of any proposal like this that rewards poor financial knowledge by providing the ‘less fortunate’ with greater access to capital than those who were intelligent about their real estate dealings.

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Venezuela is undergoing an election of monumental proportions today that may give Socialist leader Hugo Chavez the ability to be in office for the rest of his life. The election is a complete redraft of the constitution and perhaps the most important vote in the history of the country. Many former supports of the government have recently defected, calling the newly drafted constitution a step in the wrong direction and giving far too much power to the current President. Even with such public defections and anti-constitution protests that have been seen all over the country the past week, the chance for approval is seen as greater than 50/50. (more…)

The Canadian Dollar/US Dollar ratio hit 1:1 today for the first time in decades. After years of languishing behind the greenback, the loonie has now proven to be among the strongest currencies on the planet. (more…)

Yesterday’s rate cut by the Federal Reserve Bank sent markets worldwide soaring. The Dow shot up over 300 points, while markets in Asia, Europe, and Latin America all rose in hopes that the lowering in rates will put an end to the credit crisis. (more…)

(Reprint from July 6, 2006)

In the grand history of civilization, the case of the United States vs. Mexico is one of the most prime examples of how governmental interference in markets increases poverty, decreases standards of living, and wrecks millions of lives. Much of the western part of America was under Mexican rule as late as the mid 1800’s. (more…)

(Reprint of Dec. 5, 2006)

The year of the election in South America ended rather undramatically as Hugo Chavez won his bid for re-election in South America. A year ago, his policies and his anti-US stance were drawing in fans across the continent and indeed across the world. Much had been made of the nationalistic tendencies of (more…)

After 12 years of being ruled by the Liberal party, Canadians elected the Tories to power on Monday, giving an already strong nation another reason to be increasingly optimistic about its future. Despite a strong economy, the Liberal party was ousted as allegations of corruption resonated throughout the country. While many leaders, such as Brazil’s Lula de Silva seemingly (more…)

(Reprint from March 9, 2006)

Recently, investment products developed by the likes of Morgan Stanley and Merrill Lynch are shaking up the housing industry in ways never seen before. These products are correlated to the inverse of the Philadelphia Housing Index (^HGX) - and the most amazing part is - some are completely risk free. (more…)

(Reprint from June 15, 2006)

The past month has seen an increase in volatility in markets around the world. India, Greece, Russia, Turkey, Colombia, and emerging markets everywhere saw drops of well over 20% in their indexes. The Commodity Investor has reported several times over the past few months that a sharp drop like this was likely, and the most overpriced, vulnerable markets will get hit hardest. So far this prediction has turned out to be correct. (more…)