Outside the Box, July 2010


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Running through a minefield, backwards

July 27, 2010

Before we get into today's Outside the Box I want to clear up a few ideas from this weekend's letter. There have been posts on various websites equating my piece on deflation with Paul Krugman. They say I am advocating kicking the can down the road and not reducing the deficit.

Wrong. What I have been trying to point out for several years is that we have no good choices. We are down to bad and very bad choices. The very bad choice (leading to disastrous - think Greece) is to continue to run...

Dispatch: China Factors in U.S.-South Korean Relations

July 22, 2010

The key to being a great chess player is to think ahead. True grandmasters think ahead not by just one or two steps, but a full game. The key to winning is determining the most likely moves of your opponent, among what seem at first glance to be hundreds of possibilities. The same can be said of finance. Knowing what to expect from key world players is critical to investing.

STRATFOR is an intelligence agency available to the public. If you want to know what to expect from different nations...

Asia’s Paradigm Shift

July 19, 2010

This week we turn our eyes to Asia as my friend Louis Gave of GaveKal gives us a very thought-provoking piece on the problems of investing in Asia, with a focus on China. While there are real opportunities, Louis also sees some speed bumps. Those Asian ETFs may not be the winners a lot of people think for structural reasons.

I was to thank the team at GaveKal for letting me reproduce their research as typically it is only available to their clients who pay a rather hefty sum.

This has been a...

Recession, Deflation and Deficits

July 12, 2010

I look forward at the beginning of every quarter to receiving the Quarterly Outlook from Hoisington Investment Management. They have been prominent proponents of the view that deflation is the problem, stemming from a variety of factors, and write about their views in a very clear and concise manner. This quarter's letter is no exception, where they once again delve into the history books to bring up fresh and relevant lessons for today. This is a must read piece.

Hoisington Investment...

Europe: The State of the Banking System

July 8, 2010

We're bombarded with information from the minute we wake up until the second we fall asleep. I was watching a news network last night for 45 minutes and the exact stories started coming back around. Nothing new to report, but the same topics on repeat, with the rare nominal development.

When I need something different (and relevant to me), I go to STRATFOR.com. They provide deep insight and explanation of events the networks can't begin to tackle. Today I'm including an extensive article on...