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War Room 08/09 S+P Downgrade Decision. The War Room Monthly macro discussion Using tools in context Feature for subscribers only Feedback - what should.

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Presentation on theme: "War Room 08/09 S+P Downgrade Decision. The War Room Monthly macro discussion Using tools in context Feature for subscribers only Feedback - what should."— Presentation transcript:

1 War Room 08/09 S+P Downgrade Decision

2 The War Room Monthly macro discussion Using tools in context Feature for subscribers only Feedback - what should it to be?

3 Agenda Current Status Scenarios in play Discovering safe harbors Whats next?

4 Where are we right now? Gold at all time highs at $1743/oz Market bounces after 12 day sell-off Fed pledges to keep rates low through mid 2013 – 3 dissenting voters Dollar at record low vs Swiss Francs, post FOMC Treasury Yields hitting record lows, after S+P decision, post FOMC

5 Scenarios in Play Debt Ceiling Downgrade Cascading downgrades from S+P Double Dip Recession QE 3 – not yet in play

6 Discovering safe harbors Currencies – Yen + Swiss Francs Precious Metals Low + Negative Beta to S+P Try the Macro Trend Screener

7 7/20/11 Not all gold plays are following gold up… … some are following the market down.

8 Whats next? Cascading Downgrades Scenario still on table Double Dip Recession Scenario Volatility Increasing

9 On the chopping blockShould be immune US Banks European Countries European Banks 11k municipal bonds Pre-funded with escrowed Treasuries Backed by federal leases For areas with high DoD concentration For areas that depend on fed spending For agricultural entities Mortgage REITS Fannie + Freddie Israeli sovereign debt Insurance Companies (italics: already downgraded) States or local governments bonds: Fiscally insulated from federal interventions With a predictable institutional framework Financially flexible Emerging market debt Debt downgrade: who is next?

10

11 Volatility of Autumn 2008 crisis Will be mirrored in Autumn If you sell, sell into strength. 27July – 08Aug October 2008


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