Pliable Figures, Cruel Facts

Some important figures as of 28 Dec 2019 for analysing the big picture of the market:

Gold is at 1515.65, 

US 10-yr treasury yield at 1.877% and 

USD/CNY at 6.9958.

My interpretation:

With Europe’s and Japan’s interest rates at an even lower level, US is not likely to be in a position to try to increase interest rates in the foreseeable future to create for themselves problems in presidential election year in 2020 unless there are compelling reasons like unbridled high inflation.

Some big boys must have slowly amassed some gold to balance their portfolio as S&P 500 hits all-time high.

Although the US 10-year treasury yield is still far from the 3% threshold that will trigger panic selling in the stock market, we just cannot throw caution to the wind that there will not be any black swan event as big scale as the Lehman Brothers collapse.

The US government today owes the world about US$24 trillion through treasury bonds and Trump knows very well that if he can cut the interest rates by 1 percent, the US will save about US$240 billion a year, which is at least double the tariffs they could squeeze from China through the US-China trade war. Trump is a businessperson and he sure knows about the advantage of maintaining a low interest-rate climate. The next US president may not know or believe in this. The US economy will do better with Trump as the US president.

The threat of China market going down further and the overhang for the HK stock market have subsided greatly with the strengthening of CNY against USD.   

Figures are pliable. They can be the bellwether of the market provided one knows how to interpret them correctly.

Superphang
https://superphang.blogspot.sg