• 107 days Will The ECB Continue To Hike Rates?
  • 107 days Forbes: Aramco Remains Largest Company In The Middle East
  • 109 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 509 days Could Crypto Overtake Traditional Investment?
  • 514 days Americans Still Quitting Jobs At Record Pace
  • 515 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 519 days Is The Dollar Too Strong?
  • 519 days Big Tech Disappoints Investors on Earnings Calls
  • 520 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 521 days China Is Quietly Trying To Distance Itself From Russia
  • 522 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 526 days Crypto Investors Won Big In 2021
  • 526 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 527 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 529 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 529 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 533 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 534 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 534 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 536 days Are NFTs About To Take Over Gaming?
Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

Boris Chikvashvili

Boris Chikvashvili

Boris Chikvashvili was supposed to be a theoretical physicist (Russia+Jerusalem Hebrew University, MS Physics, with distinction, toyed with QUARKS). Somewhere on the road to PHD…

Contact Author

  1. Home
  2. Markets
  3. Other

Can't Put Humpty Dumpty BRICs Together Again

Dear Reader, as the year end of 2015 draws close , I would like to remind you , that FOREX market is the largest and most important market. I have humbly stated in the past that if one can predict currency movements all other financial / economic variables are much easier to predict. So, let us see how well have we done in this category.


Currencies

In 2013 I published an article http://www.safehaven.com/article/26863/brics-are-falling-india-general-market-survey. It has discussed the Dollar In general and BRIC currencies in particular with a further example of INR( Indian Rupee). As can be ascertained we were pretty gloomy on the prospects of BRIC currencies and pretty bullish on Dollar in general.

Of course now the question is where do we go from here? It appears to us that the carnage of BRIC currencies and general trend higher in Dollar is not complete. It is very, very likely to have deserved respite in / after January 2016, but these trends will come back, as Dollar did not yet give us a final sign of the $ bull ending. In our opinion, Dollar Bull Is not likely to end till 2017, at least, and could last into 2018 just as easily. Below , please see current state of BRIC currencies in graph. As you can see the BRIC ( Brazilian Real, Russian Ruble, Indian Rupee and Chinese Yuan ) have not done well for last 4 years or longer.The only one currency that survived the carnage , is USD.CNY and that too , only up to the point, when its inclusion into the SDR(Special Drawing Rights) was discussed. At / After that decision In November of 2015 CHINA feels free to depreciate the YUAN as it wishes.

 USD versus BRL, RUB, INR and CNY Charts
Larger Image


Stocks

We were not particularly bullish towards the Stocks Market last time around, but we thought it could meander due to the intervening short term cycle strength that would keep the market elevated for a while. We believe this has happened to a large extent and now the more ( long , intermediate and short ) cycles are conspiring to push the market lower into 2016( maybe as early as January). The only way we could change our outlook ( even for a short term) would be if SPX closes above May highs.

 

Back to homepage

Leave a comment

Leave a comment