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A State of Flux. Steen Jakobsen , Chief Investment Officer Saxo Bank A/S May 2014. Ockham’s Razor. Stock Market lags real economy by three months Interest rates leads real economy by nine months. What did happen 9-12 month ago?. What did happen 3 month ago?.
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A State of Flux Steen Jakobsen, Chief Investment Officer Saxo Bank A/S May 2014
Ockham’s Razor • Stock Market lags real economy by three months • Interest rates leads real economy by nine months
Macro Outlook in headlines • Positions: • Mega long fixed income (Q3-2013) – See new lows in yield • FX: Short AUDUSD(.8000 sub target),EURUSD(sub 1.2500) • Sell ZAR, TRY and IDR soon (all basket cases….w. no reform) • Equity: Long Israel + Russia vs. SPX (CAPE <10 vs. CAPE >24 (avg 13/14 – waiting for catalyst to short SPX & DAX (plus Club Med) • Monetary Policy: • ECB will disappoint – they love to talk…too much… • BOJ is cornered (USDJPY 92/93 • FED will taper the taper….. • Fight will be on deflation…..now unanchored • Economics: • Germany will go towards negative growth in Q4/Q1-2014/2015 • Fragile Eight: No reforms, elections – it’s time to sell….. • 2014: Another lost year • 2015 H2: The true recovery