ES -- DX/CL -- isee -- cboe put/call -- specialist/public short ratio -- trinq -- trin -- aaii bull ratio -- abx -- cmbx -- cdx -- vxo p&f -- SPX volatility curve -- VIX:VXO skew -- commodity screen -- cot -- conference board

Wednesday, October 22, 2008


and just for fun, let's toss in an emerging markets currency crisis as well, hey?

jesus wept. i read brad setser's account earlier and hoped for better. color me disabused.

Public sector surpluses in many [emerging markets] have masked the fact that the private sector there has (a) acquired long term (unsaleable) USD assets with S-T USD funds which it cannot now readily access and (b) that far too many of the firms and individuals whoe were so effortlessly earning those dollars via exports have geared up further to take advantage of what looked like the one-way bet of a falling greenback borrowable at negative real interest rates…

Now this has all fallen apart, we now have a severe squeeze developing in parts of Asia, most of Latam, and all across E Europe and the FSU…

We seem to be adding a slow burning 1997-01 EM crisis on top of our Western woes… and, so far, there has been no concerted CB move to provide these people with the dollars they need, unlike in the developed nations….

Given that many are also reliant on commodity earnings this can’t help either, for this adds to their overreliance on bankrupt Western consumers and on widespread capital expansion in a booming world for their higher order goods sectors…

pick your poison -- any one of a dozen countries are vying to become the next iceland. this way lies global depression.

UPDATE: more from setser -- what a disaster.

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