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Global Economic Outlook & Forecasts

This is a discussion page focused on the outlook or forecast for global economy.

Comments are also welcome in relation to the medium to long term trends for the major global stock markets and global economics indicators such as the Baltic Dry Index (BDI), precious metal prices & commodities futures.

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This forum is for discussion purposes only and is not meant to act as any form of financial or investment advice. All site visitors are urged to do their own research and/or seek assistance from a reputable investment adviser before making any investment related decisions.

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28 Comments

28 responses so far ↓

  • 1 Greg Atkinson // Jun 14, 2010 at 9:51 pm

    The fall in the BDI is starting to worry me a little. If the current recovery across the major stock markets is going to keep going then I would be expecting the Baltic Dry Index not to fall through 3000. Oil prices also look a little soft.

    Perhaps the global economy is slowly sorting itself out, but it doesn’t look like a particularly strong recovery to me. It could be late 2011 before we get back to pre-GFC levels or even later!

    The BDI is currently around 3228.

  • 2 Greg Atkinson // Jun 29, 2010 at 8:58 pm

    The BDI is now below 2500 and there are signs that the Chinese economy might be slowing. As I have said before, keep your eye on the BDI :)

  • 3 Greg Atkinson // Jul 7, 2010 at 9:35 am

    Well the mainstream media have finally realised the BDI is down after 28 days of consecutive falls! See: http://www.theaustralian.com.au/business/markets/baltic-index-under-iron-ore-pressure/story-e6frg91o-1225888748649?from=public_rss

  • 4 Anon // Jul 27, 2010 at 8:17 am

    T2 Partners quarterly

    http://www.valueinvestingcongress.com/landing/n10/downloads/T2-Partners-AB-InBev-BP-Microsoft.pdf

    Talks about market direction, whether we are in a bear or bull market, or both. Dont agree with their range bound thesis, at least for the next several months into next year. High probability to break out of the range and new highs, albeit we might slip back into the range (after Feb 2011?) on a longer duration.
    Page 41 onwards shows why BP is undervalued and the media have completely overblown the potential damages. I partially fell for the media hype by selling my position at near breakeven, but quickly realised my mistake, bght calls, and then loaded common on the last pullback @ 35$. Wont be making the same mistake twice! If you are going to make a mistake, thats life; but you better recognize it quickly, even if you are unaware you better become aware, or life will force you to!

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 5 Anon // Jul 27, 2010 at 8:18 am

    Good bullish leading indicator from mutual funds; retailers still doubting the rise which is bullish signal aswell:

    “Mutual funds, pensions and endowments are spending more on stocks than at any time since the start of the bull market, just as individuals grow the most pessimistic in a year.”

    http://www.bloomberg.com/news/2010-07-25/stock-buying-hits-bull-market-high-at-institutions-as-individuals-retreat.html

    Mutual fund bullishness is usually only a contrarian indicator at market extremes, the crowd is usually right in the meat of the rally.

    *All posts by this poster is not financial advice or a reccomendation to do something. Can change my mind quickly on any decision I make, given markets always change. Have positions in instruments discussed unless otherwise indicated.

  • 6 Greg Atkinson // Jul 29, 2010 at 4:06 pm

    Well the BDI appears to have bottomed out at around 1700 and is now up around 1900. If is keeps heading up and breaks through 2500 then I reckon we will have a nice Q3 rally on our hands across most major markets.

  • 7 Plornt // Aug 3, 2010 at 10:11 am

    Oil broke 80, looks like its going alot higher provided it can hold 80.

  • 8 Plornt // Aug 7, 2010 at 3:04 am

    Abit off topic, but thought was interesting and to share:

    Just read a study that was done about complexity of trading or investing techniques and relative performance. Consensus seems to be trying to make everything as difficult as possible. But the simpler strategies tended to outperform the more complex ones by a substantial margin. I guess its easier to be disciplined at a simpler strategy, than trying to make something as complicated or as rigorous as possible? Also most people have the “no pain, no gain” mentality and think the more rigorous the research or effort the better the result; which is not always the case. Infact I know many situations where i’ve spent 5 minutes on something and beaten others considerably, with 1/100th the effort.

    I guess I have a core set of rules that I follow that are simple, low stress and not very time consuming to implement. Although wont discuss the core rules as am fully aware we all coat-tail off each other, but don’t want to be coat-tailed ourselves.
    Just some thoughts, and I hope everyone does well in the comming months.

  • 9 Greg Atkinson // Jan 1, 2011 at 8:25 am

    Well we start off 2011 with the Baltic Dry Index (BDI) at around 1,773 and falling – that’s not good. Gold is around US$1421 per ounce and oil just over US$90 a barrel. (which hardly is surprising since the USD is so weak)

    So how does the global economy look? Weak!

    If the BDI keeps slipping I would expect that commodities will have a nasty correction and my feeling is that this year may not be the one to try and ride commodities prices up again.

  • 10 Greg Atkinson // May 17, 2011 at 2:54 pm

    I read today that George Soros has been selling out of his gold positions. See: Soros dumped most gold in Q1, Paulson stays put

    Does this mean Soros thinks gold is now in a bubble?

  • 11 Anon // May 17, 2011 at 3:03 pm

    Maybe. But remember its still below inflation adjusted historical highs.

    I’m not touching gold as I feel its abit too hot for me atm. I’ll buy some when and if it tanks very heavily, aka Silver.
    Soros may also be trying to get the price lower, in order to buy more, or he feels a retracement is overdue, just like Silver in the high 40′s.
    Some say Silver tends to be a leading indicator for the gold price, who knows.

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 12 Anon // May 18, 2011 at 8:05 pm

    Gold Prices due for a correction:

    http://www.mining.com/2011/05/09/adrian-day-gold-prices-due-for-a-correction/

    This drivel is not advice. Seek a licensed financial advisor. Runaway from the incompetent ones.

  • 13 Greg Atkinson // Jun 11, 2011 at 9:00 am

    Global stock markets continue to fall with the Dow Jones falling again last night on concerns about the world economy.

    As reported by Bloomberg today:

    “U.S. stocks extended a sixth weekly drop, the longest slump for the Dow Jones Industrial Average since 2002, and oil slid while Treasuries, the dollar and yen rose amid concern the global economy is slowing. Crude extended losses as OPEC said Saudi Arabia pumped the most since 2008.”

    Now we are finding out just how effective the G-20 dash to toss around borrowed cash really was.

    Looking at the Baltic Dry Index I would say the outlook for the global economy this year is not looking good at all.

  • 14 Greg Atkinson // Aug 8, 2011 at 8:14 am

    Looks like the BDI was telling us what shape the global economy was in afterall and perhaps now the stock markets are falling to get in sync?

  • 15 Greg Atkinson // Dec 22, 2011 at 2:06 pm

    Here is a good collection of charts that pretty sum up fairly well the state of much of the global economy as we approach the end of another year.

    2011 CHARTS OF THE YEAR from Thomson Reuters Alpha Now

  • 16 Lachlan // Dec 22, 2011 at 6:57 pm

    When I saw those charts Greg I gulped and thought you’d gone all hockey stick on me…just before I realised it was only European youth unemployment and bond spreads.

  • 17 Greg Atkinson // Jan 5, 2012 at 8:21 pm

    The Baltic Dry Index is not looking good and is heading down towards 1500. Looks like the fall in commodities prices may have some further to run. I don’t expect much good news in Q1 2012.

  • 18 Greg Atkinson // Jan 14, 2012 at 9:09 am

    Update: The Baltic Dry Index is still falling and is now just above 1000. It has been heading down now since late December 2011 when it was trading around 1800. This does not look good!

  • 19 Ned S // Jan 14, 2012 at 12:53 pm

    Italian debt is now BBB+
    Top notch of the “Lower medium grade” stuff.
    Should it drop 3 more notches to BB+ it’ll be top notch “Non-investment grade speculative” stuff.

    Things are getting interesting alright.

  • 20 Ned S // Jan 14, 2012 at 2:58 pm

    Musing of the moment: USSR empire broke apart; EU next; Then the unthinkable (inconceivable at this time actually) – The US?????

  • 21 Ned S // Jan 14, 2012 at 3:29 pm

    The US – Nope it’s not conceivable. They’ll stay together like China and Russia over time I reckon. Which will contribute to their strength – Same for China and Russia.

  • 22 Lachlan // Jan 15, 2012 at 5:51 am

    Ned a bloke called Jim Willie has made the following claim regarding Italy’s UniCredit.

    “So next on tap is UniCredit going bad, going bust, failing, turning to dust. And when that happens look for at least another couple Italian banks to also go bust. And when that happens look for the French banks to go bust. The three major French banks. Credit Agricole, BNP Paribas, and Societe Generale. And when that happens look for at least one or two London banks to go bust- they’re all inter-connected!”

    I am not vouching for the claim but it is interesting because Jim has a high profile in the gold bugs community and would be foolish to say something that hasn’t at least a chance.
    He reckons this will come to fruition very soon, maybe this month.

    link..

    http://silverdoctors.blogspot.com/2012/01/jim-willie-unicredit-failure-is-on-tap.html

  • 23 Lachlan // Jan 15, 2012 at 6:04 am

    The recent market action has me still neutral with the next move likely a gradual grind upwards or a sharp move down. I’m hoping we break down anyhow because I have money coming in to buy things.
    Capitalist pig eh ;)

  • 24 Greg Atkinson // Jan 15, 2012 at 11:43 am

    I suspect soon we will have the OECD, IMF, World Bank etc revise their growth forecasts for this year especially if the slowdown in China continues – which I reckon it will.

    I will be looking for gold prices to fall, oil prices to rise (on fundamentals no geopolitics) and the BDI to recover before I feel tempted to move much out of cash & into stocks.

  • 25 Greg Atkinson // Jan 18, 2012 at 1:14 pm

    Well the World Bank have lowered their forecast now so it seems they read my comment above ;) According to a report in The Australian today:

    THE World Bank has slashed growth forecasts, warning that the global economy could be thrown into a worse recession than it faced during the global financial crisis.

    In its latest briefing on global economic prospects, the bank said that the world economy had entered a new and difficult phase characterised by “significant downside risks and fragility”.

    “While contained for the moment, the risk of a much broader freezing up of capital markets and a global crisis similar in magnitude to the Lehman crisis remains,” it said. “The world could be thrown into a recession as large or even larger than that of 2008-09.”

    The Washington-based development lender forecast that the world economy would expand 2.5 per cent in 2012 and 3.1 per cent in 2013, sharply lowering its June estimate of 3.6 per cent for both years.

    Source: http://www.theaustralian.com.au/business/economics/world-bank-lowers-global-growth-outlook/story-e6frg926-1226247311109

  • 26 Stillgotshoeson // Apr 13, 2012 at 9:32 pm

    A good video….

    http://www.economonitor.com/blog/2012/04/video-steve-keen-on-modelling-and-the-krugman-debate/

  • 27 Greg Atkinson // Apr 14, 2012 at 7:38 am

    Thanks for that clip. Very interesting. As I said back a few years ago I thought it was madness for policy makers to attempt to borrow and spend their way out of a debt crisis, but clearly they also seem to be in the group that reckon debt doesn’t matter.

  • 28 Greg Atkinson // May 15, 2012 at 12:03 pm

    Not a positive sign for global growth with Pimco suggesting the the slowdown in China has further to go: China Growth Seen at 13-Year Low by Pimco (Bloomberg) http://bloom.bg/JA4zIU

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