Friday, March 28, 2008

I learned something that might be useful - "In times of crisis, correlation increases."


I read an interesting thing on the Seeking Alpha BLOG that I will not try to repeat here, (and that BLOG refered to this article)

The article stated something quite interesting:
There is no escape. People investing in stocks have lost money since world equities peaked on Hallowe'en last year and shifting around the world cannot change that. The amount you lose is determined by your home currency.
So it sounds as though the world economies are slowing down in lock step.....probably an indication of hosw strong of an influence the US economy, and the US Dollar has on everyone.

So my theory has been that the world would eventually get tired of the USA's debtor ways, and find a way to replace our consumtion with consumers....oh, say from China or India.

I think the sign that this has begun to take hold is when the three economies of the world stop correlating so closely.....when the USA is allowed to drop while the others level off and then perhaps climb.

At that point, there will be a clear winner in terms of where to invest. But what to do in the mean time.

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1 Comments:

Anonymous QUALITY STOCKS UNDER 4 DOLLARS said...

If you compare the past to the present their very simlar.

5:02 PM EST  

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