Public pension funds are some of the biggest casualties of this market slump. The New York state pension fund has lost 20% of its value since April. This is more bad news for baby boomers, says Bill Bonner. This generation is already “woefully ill-prepared for retirement” and could end up causing the “fiscal meltdown of this nation”.
Gold pushed higher in Hong Kong, peaking at $755, then declined slowly until the late morning in New York, bottoming at $728, and finally rose again slowly through the Globex to finish at $743.80, up $15.20. Overnight, gold has edged higher.
The wild market swings of late are most likely down to hedge funds says Keith Fitz-Gerald. These big money movers are liquidating assets to meet margin calls, causing chaos in the markets. Keith has four tips on how to dodge the worst of the damage.
Energy guru Dave Gonigam says speculators were wrongly used as a scapegoat for soaring crude oil prices in the first half of the year. But he thinks they are playing a big role in the current slump, as hedge funds liquidate their commodity assets rapidly. Dave says the supply and demand fundamentals of oil are unchanged. That is why he is still bullish crude in the long term.
Last week, market volatility reached record levels. Dan Amoss says the wild gyrations in stocks are the result of hedge funds liquidating assets to cover their highly-leveraged positions. This means some good firms — especially those providing vital functions in the food and energy markets — are now massively undervalued.
This has been a bad year for hedge funds. Many are facing huge redemptions, while others, such as Ospraie’s flagship commodity fund last week, are simply shutting down. You might think this is all down to the credit crunch or market volatility wiping these funds out, but that’s not always the case. I want to take a look for a moment at the possible motives behind some of these closures. They might not be as simple as they first appear…
A Mid-Year Correction. Whatever Happened to Decoupling? The UK Starts to Slow. A Recession by Any Other Name. What’s a Central Banker to Do?
British banks and their shareholders are having a tough old time of it. But their woes have made at least one person an awful lot richer.
I had lunch with a leading hedge fund manager over the weekend. He didn’t want me to mention his name, but he was happy to admit – in fact he went on about it at great length – that he and many of his peers have a serious problem on their hands and there’s not a lot they can do about it.
One of the things people don’t understand about buying gold for diversification is that it doesn’t work all the time. It works over time. That means that you can’t simply switch from one asset class to another when the going gets tough and expect miracles.
