Greetings,
I will keep
this Economic Update brief since I sent out the tutorial earlier.
Keep an
eye on the 2-yr vs 10-yr and 2-yr vs 30-yr Treasury spreads. They are both in
dangerous territory. Expect the 30-year spread to get manipulated back to a
somewhat safer level.
Also, notice the Hamill Economic Indicator chart
shown below. We are still a LONG way from where we were prior to the major
collapse that began in September 2008.
Lastly, notice that China is
continuing to do worse than where it was at last July – even with a massive
amount of stimulus spending and a Communist government to force it upon the
people. China will be getting hit hard sometime, I just don’t know the exact
data. Some of you may now be seeing some articles where others are starting to
talk about this. It’s labeled as a “contrarian” position. In my opinion, the
99.999% of people who think China is going to do great should be labeled the
contrarians. After all, economic history does not support their position.
J
_______________________________________________________
Watch
for these indexes to drop:
Chinese Shanghai Composite Index: 3,212.75
(change of 1.66% from July 20, 2009 base
value of 3,266.92)
Shenzhen Stock Exchange Component Stock Index (SSE):
13,161.09 (change of 1.65% from July 20,
2009 base value of
13,381.22)
________________________________________________________
Here
are today’s numbers for the economic indicator:
1) Gold = $1,150.70
2) Silver = $18.55
3) Dollar
Index = 77.00
4) Oil = $82.03
5) S&P 500 Index = 1,146.98
6)
3-month Treasury Bill yield = 0.03
7) 3-month OIS = 0.14
HEI =
28.05
(A value of under 100 indicates deflation, while over 100 indicates
inflation – as referenced to Sept. 12, 2008…the day before Lehman Brothers
collapsed)
__________________________________________________________
Here
are the numbers for the day:
Dollar Index adjusted indexes:
Dow =
(10,663.99) x (0.7700) = 8,211.27
S&P 500 = (1,146.98) x (0.7700) =
883.17
Nasdaq = (2,312.41) x (0.7700) = 1,780.56
3-month Treasury:
0.03
2-year Treasury: 0.93
10-year Treasury: 3.81
30-year
Treasury: 4.73
2-yr vs. 10-yr Spread (Target > 273): 288 basis points – (Danger Zone)
2-yr vs.
30-yr Spread (Target > 369): 380 basis points –
(Danger Zone)
3-month LIBOR: 0.25
3-month EURIBOR:
0.69
3-month OIS: 0.14
TED Spread: 22 basis
points
LIBOR/OIS Spread: 11 basis points
Dollar Index:
77.00
Volatility Index: 17.55
JPY-EUR Exchange Rate (Target <
115): 133.6855
JPY-GBP Exchange Rate (Target < 145):
148.491
JPY-USD Exchange Rate (Target < 90): 92.16
USD-EUR
Exchange Rate (Target < 1.25): 1.4506
USD-CNY Exchange Rate (Target
> 7.0): 6.8263
Warmly,
Brad
Comments or questions?
brhamill@hamill.com
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