"If we want everything to stay as it is, everything will have
to change." - from
by Giuseppe Tomasi di Lamedusa
"The crisis takes a much longer time coming than you think,
and then it happens much faster than you would have thought, and
that's sort of exactly the Mexican story. It took forever and
then it took a night." - Rudiger Dornbusch
Europe's leaders are committed to keeping both the euro and the
eurozone as it is. But for it to do so, everything must change, as
the wonderful quote from the 1958 Italian novel suggests. This is
no easy task, as no one wants a change that will impact them
negatively; and there is no change that will allow things to stay
the same that does not impact all severely, as we will see. In the
third part of a continuing series, we look at the actual options
that are available on the menu of choices, or as one group called
it, the menu of pain. I offer some guideposts that we should watch
for along the way, and end by offering a suggestion as to what
Europe should do. As has been the case in this series, I do my best
to offend everyone at some point. If by some small, unintended
oversight I do not, then wait another week, I will get to you. What
else are friends for?
But before we take on Europe, let me quickly tell you to save
the date for my annual Strategic Investment Conference,
co-sponsored with my partners, Altegris Investments. And what a
lineup we have this year. Already scheduled are my friends Dr.
Woody Brock, Mohamed El-Erian, Marc Faber, Niall Ferguson,
bond-fund star Jeff Gundlach, Dr. Lacy Hunt, David Rosenberg, as
well as your humble analyst. And there are a few more blockbuster
names we are close to finalizing. Most people who attend think this
is simply the best investment conference of the year, and I think
this one looks better than ever. It will be May 2-4 in the San
Diego area. I will soon give you details about where you can go to
register, but for now put it in your calendar. What better way to
think about how to invest in these times than to hear some of the
best minds in the world, all in one place?
As this letter will suggest, I don't think this is the year you
want your portfolio in typical long-only funds. There is a lot of
tail risk this year coming from Europe.
Now, let's jump right in.
Choices, Debt, and the Endgame
We started off this New Year's series by pointing out that the
choices we make today are constrained by the choices we made in the
past, and the choices we make in the future will be limited by the
choices we make today. Europe chose to create a free trade zone,
and then some of the countries proceeded to lock themselves into
the gold standard of a single currency, relinquishing the ability
to adjust any imbalances in their economies by changes in the
prices of their own currencies.
Interest rates for the southern tier of Europe dropped to levels
never available to them before, and those countries responded by
borrowing ever-increasing amounts of money to finance current
spending. Then came the credit crisis, and budgets simply ballooned
out of control, and debts began to get to levels that made the bond
markets ask for ever-higher rates, as concerns about sovereign
defaults began to rise.
This problem was compounded by the fact that European banking
institutions were allowed to leverage their purchases of sovereign
debt by 30 or 40 to 1 their actual capital. That means even a
default by a small country has potentially big ramifications. As it
became clear that Greece was in trouble, European leaders at first
thought that if Greece was given some time, it could get its budget
deficit under control and then once again gain access to the bond
In the summer of last year, after dithering through some 40-odd
summits, it began to dawn on European leaders that it was not a
short-term liquidity crisis they had on their hands but a solvency
crisis. A fact that numerous commentators had been pointing out to
them for quite some time. And as Greece began shake and bake its
way to "austerity," the very act of cutting deficits pushed the
country into recession, which lowered tax revenues and increased
expenses, putting the elusive goal of a balanced budget even
further off. We should quickly note that this is not just a Greek
problem. Spain's "draconian" cuts have meant that its 6% deficit
target for the year has this week been raised to a more likely 8%,
making it harder to get back to even.
For country after country, this is the Endgame. It is the end of
the Debt Supercycle. Debt has grown to the size that it cannot be
sustained. The market will not lend any more money on terms that
can be afforded, and any efforts to cut spending and raise taxes
will result in an even worse economy, in various degrees of
recession, with falling revenues and rising costs.
Europe has three main problems.
- A growing number of its countries are insolvent or close to
it. It is increasingly likely that the only way forward is for
defaults of some type, to lessen the burden of debt to a level
where it can be dealt with and that will allow the countries the
possibility of growth, which is the only real answer to the
problems they face.
- Because of growing fears of multiple defaults (just Greece
would be bad enough!) most of the banks in Europe are seen to be
insolvent and in need of hundreds of billions of euros of new
capital. The interbank market in Europe is in a shambles, and
banks park their cash with the ECB, at a lower rate of return, as
that is the only institution they trust. They clearly do not
trust each other. As an aside, I heard from many sources while I
was Hong Kong and Singapore, meeting with readers and friends,
that European banks (especially French) are cutting back on their
trade lending, which is making normal commerce more difficult.
Didn't we just go through that in 2008?
- The real problem in Europe is the massive trade imbalances
between the peripheral countries and the so-called core
countries. Without the ability to adjust currencies, those trade
imbalances will render any debt solution moot, as a country
cannot balance its budget while it runs a trade deficit and its
citizens and businesses also deleverage. I have written about
this arithmetic problem on numerous occasions. There must be
balance or there must be a mechanism to achieve balance.
One cannot solve one problem without solving all three. Either
they all get done or none truly get done. You can kick the can down
the road by solving problems 1 and 2, but problem 3 will put you
shortly back to square one.
Europe is now trying to address problems 1 and 2. They are
talking about a "new treaty" that will require austerity of a real
kind, although I understand that Germany has put in a clause that
gives it some extra time to achieve its own balanced budget. And
the ECB is dispensing euros through the back door to banks, in
exchange for anything resembling collateral. Not directly of
course, as that is prohibited, but the same thing is being
accomplished, despite objections in some quarters, mostly
Staring Into the Abyss
It was late in September of 1998. I was flying from New York to
Bermuda to speak at a hedge fund conference, and found myself
upgraded at the last minute, back in the day when I did not fly
that much, so I was feeling rather happy. As the door closed, a
patrician-looking gentleman stepped in and came and sat next to me,
immediately picking up a file and burrowing into it. I had a book
Wall Street Journal,
so I was content to read.
As soon as we took off, he asked for a scotch. He proceeded,
over the next hour, to wage a very aggressive war on the
diminishing cache of scotch bottles stored on board. (No, it was
not Art Cashin. He doesn't fly.) It was an arduous campaign, but he
was fully committed to winning.
He glanced over to my
and noted some headline about the crisis that had occurred the
previous week. I had been following the extreme market volatility
with interest, but this was in the first decade of the internet, so
most of what you came by you still read in print or heard on the
"They don't really know how close we came," he shuddered, his
eyes showing the first signs of emotion - and fear - I had seen
from him. That piqued my interest, and I engaged him, though
without touching his precious hoard of scotch. I settled for a nice
chardonnay. It turned out he was the second-ranking executive at
one of the three largest banks in the country. He had been at the
table in the NY Fed boardroom when 14 banks were forced to put in
$3.625 billion to keep Long Term Capital from collapsing, with only
Bear Stearns declining (one of the reasons they had no friends ten
years later). The NY Fed president had essentially called all the
heads of the banks, told them to be in the room, not to send
proxies, and to bring their checkbooks. There was subsequently a
lot of criticism of the Fed, but they did what a central bank is
supposed to do in times like that: they made the children play nice
in the sandbox. They were the only entity that could force the
various monster-ego players to even sit in the same room with each
"No one will ever really know," he said again. But of course,
soon everyone did, as Roger Lowenstein wrote the must-read
When Genius Failed.
"We walked to the edge of the abyss, and we looked over." He
proceeded to regale me with the stories of the negotiations, as the
immensity of what would happen if they allowed the collapse dawned
on the group one by one. They all had exposure to LTCM but did not
realize the extent of it until it was too late. Looking back, it
might have looked something like the credit crisis of 2008 if they
had not acted, except it would have happened much faster.
I can tell you that no one in that room wanted to write a
$300-million check. It was not good for their careers.
Interestingly, after two years the fund was liquidated and the
banks got back their capital plus a small profit.
Now, the bankers and leaders of Europe are getting ready to walk
to the edge of the Abyss. It will be a long way down, and look like
level of Dante's Inferno.
Their first real look will come in the next few weeks, as Greece
is negotiating aggressively with its lenders as to how much of a
haircut they will receive and what sort of guarantees Greece will
provide on the remaining debt (they are balking at putting the new
bonds in a legal jurisdiction that will have some real bite if they
default again, which they will). They are also negotiating with
Europe about how much additional real austerity they will have to
endure in order to be allowed to take on more debt. If they walk
away and there is an uncoordinated default, it will guarantee
chaos. Bank collateral will collapse and credit default swaps will
be triggered, including many sold by European banks that are
already essentially insolvent.
The legal euphemism here is that if debtors "voluntarily" accept
a 50% haircut, then no credit default swap protections will be
triggered on those positions. But not all parties want to
voluntarily take that loss (or an even greater one). If they are
forced to do so, then the credit default swaps they bought come
into effect. Greece can legislatively force them to take the
haircut, but CDS contracts are written in such a way that that
action would be seen as a loss, triggering the CDS insurance. The
governments involved want everyone to accept, so there is no
crisis. The funds simply want as much money as they can get back,
and many are playing a very hard-nosed game.
Can the holdouts be enticed with sweeteners that not all may
get? Maybe different collateral? Or shorter terms, or …?
The sad thing is that a 50% cut of the private lenders only gets
Greece back to what will soon be 120% debt-to-GDP, from the current
170% and rising. 120% (which I consider optimistic) is just
another, lesser form of insolvency, as Italy now understands. And
if Italy is under pressure at 120%, then it is almost a given that
the market would see Greece as still insolvent.
An Unintended (and Very Negative) Consequence
There is at least one unintended consequence arising from the
Greek settlement negotiations. Private investors thought they were
buying a bond that was "pari passu," or equal with all other Greek
sovereign debt. It now turns out they were buying junior,
second-tier, subordinated debt. Something like a second mortgage on
a home. You will take the first loss, so you then charge
accordingly. But it now seems that the ECB, the IMF, and European
public institutions are "more equal" than the private parties and
will not have to share in the losses. The private lenders have
found out they were taking subordinated risks while only getting
It the public lenders were involved in the haircuts, then maybe
it would only have to be a 30% haircut, or if it was 50% it would
be enough to maybe get Greece to the point where it might have a
chance; and the remainder of the debt would be in better shape,
rather than this just being the negotiations for the first haircut,
with more to follow.
Every private lender in Europe now recognizes they are taking
more risk when they invest in a sovereign debt instrument. This
will have the effect of pushing rates up in the private market,
like they have very recently climbed for Portugal (more on Portugal
Europe faces a set of choices. They can lend Greece more money
on promises to turn things around, which can't happen because of
(1) the very austerity being imposed and (2) the 10% of GDP trade
imbalance with the rest of Europe. But if they don't lend the money
and there is an uncontrolled default, they will get to inspect that
Abyss more closely than they would like. It will mean hundreds of
billions of euros in losses at their banks, which will have to be
bailed out eventually by taxpayers.
Europe is worried about "contagion." If Greece gets a 50%
reduction on its debt, will not Portugal point out that they
deserve it more? There have been deep fiscal cuts by the
free-market government of Pedro Passos Coelho in an attempt to
reduce the deficits, but estimates are that, even with those cuts,
the deficit will still be 6%, falling only to 4% in 2013. And that
is if things go well.
The market is not acting as if it expects things to go well.
Yields on Portugal's 10-year bonds climbed to 14.39% on Thursday.
Credit default swaps measuring bond risk have reached 1270 points,
pricing a two-thirds chance of default over the next five
While Portugal's public debt of 113pc of GDP is lower than
Greece's, the private sector has much larger debts and the
country's total debt load is higher, at 360pc of GDP - much of it
external debt. Jürgen Michels, Europe economist at Citigroup, says,
"Without a sizeable haircut to its debt stock, Portugal will not be
able to move into a viable fiscal path. We expect a haircut of 35pc
at the end of 2012 or in 2013."
Ambrose Evans-Pritchard, writing in the London
(I really like his work), notes:
Portugal is a troubling case for EU officials, who insist that
Greece is a 'one-off' case rather than the first of a string of
countries trapped in a deeper North-South structural rift. The
official line is that Portugal will pull through because it has
grasped the nettle of retrenchment and reform.
Europe's leaders have vowed that there will be no forced
'haircuts' for holders of Portuguese bonds. If the country now
spirals into a Grecian vortex as well they will have to repudiate
that promise or accept that EU taxpayers will have to shoulder
the burden of debt restructuring. While all eyes are on Greece,
it is the slower drama in Portugal that will ultimately determine
the fate of the eurozone.
A Preview of Coming Attractions
Let's turn to some charts from a well-written report called "The
European Crisis Deepens," from the Petersen Institute, by Peter
Boone and Simon Johnson. Both authors have a long list of
The first one is a chart of the cost of five-year credit default
swaps. Notice they all are rising. (This is a log chart, so the
scale rises by a factor of ten for each level.) Now, notice that
Portugal is where Greece was last year. Then pay attention to the
fact that Italy is likewise where Portugal was last year. Just
thought I would give you a preview of coming attractions,
click to enlarge images
Then they offer us this chart, which compares the labor-unit
costs of six countries in Europe. Only Ireland has seen their costs
drop, as their labor has accepted pay cuts and productivity has
increased. And pay attention to the ever-rising costs of France vs.
Germany. This trend suggests France is on a path that Greece took.
There are dragons down that path.
And it also illustrates the problem of why it will be so hard
for Greece to turn around without being able to resort to a
currency devaluation. They have to endure a 30% pay cut relative to
core Europe if they want to compete. There will be no volunteers in
Greece for such cuts. After two years of IMF and European
institutional involvement (meddling?) in Greece, there has been
hardly any movement in Greek labor costs.
Greece is not alone. Are you reading of any general pay cuts in
the proposed solutions for Italy, where labor costs are now above
those of Greece? Likewise, no move in Portugal (not shown in
graph). The entire eurozone is out of balance, and no one is making
any moves to deal with it or even acknowledge the basic
Hallucinogenic Data and Other Fun Activities
Much of establishment Europe was predicting a positive GDP for
the region only a month ago. The recent trend suggests the data
they were smoking was hallucinogenic. And given the seriousness of
the problem, it must have been primo stuff. Germany was in
recession for the 4
quarter of last year and is likely to be there this quarter, which
is the technical definition of recession. Clearly, peripheral
Europe is in recession, some countries in what looks like it could
be called a depression. Below is the Purchasing Manager's Index for
six major countries in Europe. I have added a thick red line at the
50 mark, below which there is negative growth.
Gentlemen, Choose Your Disaster
With all of the above as a backdrop, let's now see if I can
outline the choices Europe faces. First, let's take Greece, because
it is instructive. Greece has two choices. They can choose Disaster
A, which is to stay in the euro, cutting spending and raising taxes
so they can qualify for yet another bailout; negotiating more
defaults; getting further behind on their balance of payments; and
suffering along with a lack of medicine, energy, and other goods
they need. They will be mired in a depression for a generation.
Demonstrations will get ever larger and uglier, as the government
has to make even more cuts to deal with decreasing revenues, as
2.5% of their GDP in euros leaves the country each month. There is
a run on their banks. Any Greek who can is getting his money
Greek voters will then blame whichever political group was
responsible for choosing Disaster A and vote them out, as the
opposition calls for Greece to exit the euro. Which is of course
Leaving the euro is a nightmare of biblical proportions,
equivalent to about 7 of the 10 plagues that visited Egypt. First
there is a banking holiday, then all accounts are converted to
drachmas and all pensions and government pay is now in drachmas.
What about private contracts made in euros with non-Greek
businesses? And it is one thing to convert all the electronic money
and cash in the banks; but how do you get Greeks to turn in their
euros for drachmas, when they can cross the border and buy goods at
lower prices, as inflation and/or outright devaluation will follow
any change of currency. It has to. That is the whole point.
So how do you get Zorba and Deimos to willingly turn in their
remaining cash euros? You can close the borders, but that creates a
black market for euros -and the Greeks have been smuggling through
their hills for centuries. And how do you close the fishing
villages, where their cousin from Italy meets them in the
Mediterranean for a little currency exchange? What about non-Greek
businesses that built apartments or condos and sold them? They now
get paid in depreciating drachmas, while having to cover their euro
costs back home? Not to mention, how do you get "hard" currency to
buy medicine, energy, food, military supplies, etc.? The list goes
on and on. It is a lawyer's dream.
There is a third choice, Disaster C, which is worse than both of
the above. Greece can stay in the euro and default on all debt,
which cuts them off completely from the bond market for some time
to come. This forces them to make drastic cuts in all government
services and payments (salaries, pensions etc.), and suffer a
capital D Depression, as they must balance their trade payments
overnight, or do without. Then they choose Disaster B anyway.
The only real options are Disaster A or Disaster B. Whether they
opt to go straight to the drachma (Disaster B) is only a matter of
timing. They will get there soon enough.
Why then do they wait? What's the point of going through all
these motions? Because Europe fears a disorderly Disaster B. For
the rest of Europe, it is the Abyss. The Greek hope is that Europe
(read Germany) keeps funding them in order to keep back from the
edge of the Abyss.
As one European diplomat noted, "There is a growing sense that
despite the valiant efforts of Papademos … the reluctant Greek
establishment is biding its time to the next elections, banking on
the assumption that the world will continue to bail them out, no
Europe is getting closer to the point where it must make a
decision about what to do with Greece. In theory, the deadline is
March 29 for the next round of funding. It is a game with very high
stakes and deadly serious players. Can Sarkozy be seen as weak and
giving in to Greece, with elections coming up in April? Can Merkel
appear to give in and keep her troops in line? There are elections
not long after that in Greece. Can Papademos cave in to further
cuts and promises on future debt that will be hard to keep and
The markets are getting exhausted. There will be no private
market for Greek debt at any number close to what is sustainable.
Greece will be on European life support for a very long time if
they stay in and there is no disorderly default. It will mean
hundreds of billions of euros over the decade, debt forgiveness,
etc. There are no good choices.
And Europe will all too soon face what to do with Portugal,
which will want to dispense some haircuts of its own. Don't forget
Ireland, which is very serious about not paying the debt the
previous government took on for its banks in order to pay British,
German, and French banks. That is a default that is in the cards. I
think "polite" Ireland is just waiting until its $60-billion
default is seen as small potatoes, which will not be too long, as
Italy must raise almost €350 billion just to roll over current
debt. Italy projects that its deficit will be down to 2%, but if
Europe goes into recession that projection goes out the window.
The bottom line is that Italy (and most likely Spain at some
point) cannot raise the debt it needs at rates it can afford
without massive European Central Bank involvement. Rates are
already approaching 7% again. That is unsustainable from an Italian
point of view. Germany must be willing to allow the ECB to take on
massive balance-sheet debt, or Italy will not make it without
haircuts. And a mere 10% haircut for Italy dwarfs what is happening
in Greece - and doesn't do much for Italy. If they go for a
haircut, it will be much larger. French banks holds 45% of Italian
debt. Italy is too big for France to save. They cannot even
backstop their banks if Italy becomes a solvency risk. They simply
cannot get their hands on that much money without destroying their
balance sheet. The most recent downgrade of their debt was just the
first of many.
Speaking of downgrades, Egan Jones downgraded Germany from AA to
AA- and put the country on negative watch. This is important, as
this is what I believe to be the most credible rating agency; and
over 95% of the time the other "Big 3" agencies generally follow
their lead, after a period of time. Part of the reason for the
downgrade is all the debt that Germany is guaranteeing. Sean Egan
was one of the first serious analysts to suggest that Greece would
default. He was talking a 95% eventual default a long time ago.
(Very nice gentleman, by the way. Or maybe he just left his Darth
Vader mask at home when I met him.)
Europe will have to make its choice this year. Either a much
tighter, more constrictive fiscal union with a central bank that
can aggressively print euros in this crisis, or a break-up, either
controlled or not. I don't think they can kick the can until 2013,
as the market will not allow it. Either the ECB takes off its
gloves and gets down to real monetization when Italy and Spain need
it, or the wheels come off.
The quote at the beginning returns to mind: "If we want
everything to stay as it is, everything will have to change."
Like any long trip, the drive (or flight) seems to take forever,
particularly if you are very young or you are an investor. But then
suddenly you are there. The LTCM crisis mentioned above took a long
time to develop, but then it ended with a bang. One day Lehman or
Bear is a big player and the next they are gone. I think this is
the year the crisis moment for the euro arrives. Let's hope they
What Europe Should Do
When Europe approaches the edge of the Abyss and looks over, the
rest of the world gets to take a look, too. We can all be taken to
the edge and over. I was reminded while in Singapore and Hong Kong
how much we all need Europe to come through this.
Europe has problems that are structural and can't be fixed with
just another treaty or more ECB liquidity. With that in mind, here
are my thoughts.
- The European Union works, mostly much more than less. Keep
the free trade zone. There are countries that work just fine that
are not in the euro. We live in the world of computers. Currency
exchange is a computer operation and relatively easy. And keep
working on coordinating with the rest of the world. Take
advantage of what you can do together. We are all better off with
a united Europe. Until such time as there are stable labor and
productivity markets across Europe, don't press for a single
currency. Single currencies don't insure there will be no
conflict. Really integrated free trade and open borders do.
- Admit the euro just doesn't work for some countries, and let
them leave the eurozone (but stay in the free trade zone, like
Denmark and Sweden are now). Establish as orderly as possible a
path for a country to revert to its old currency. Yes, there are
going to be some very large losses. If you control it, they will
be far less than if you don't. You can set up a two-tier system,
just as you did when you created the euro. And pass some laws so
everyone isn't spending the next two decades suing everyone else.
Deal with it like adults who want to be friends after the divorce
rather than enemies for life. If you have to make up some rules,
then make them up. But do it quick. The longer you take, the more
it will cost you (and the world).
- Greece has to be told no. No more loans. No more threats. If
they want to stay, then let the market deal with them. I doubt it
will be kind, but they have to take responsibility for
themselves. Nobody forced them to borrow too much. Cut your
losses now. Use the money to salvage your own banks. When (not
if) Greece decides to go, help them with some humanitarian aid
(medicines and emergency supplies) but stop piling on debt they
can't pay. Work out the terms so they can get on their feet and
go on with their lives. Allow them to stay in the free trade
zone. And learn your lessons. Be careful whom you lend money
- Sadly, the same goes for Portugal, although with a reasonable
and very healthy haircut they may be able to stay.
- Ireland is not going to pay that bank debt. Get over it. Just
let the ECB swallow it. Then Ireland will pay the rest of its
government debt and can grow its way out of its problems. They
have a positive trade balance. Besides, who doesn't love the
- Italy and Spain are problems. If they stay they are going to
need some major ECB help on rates while they get their deficits
under control. Either do it or don't, but don't keep the world in
limbo. Germany needs to make a decision and make it very
- I don't know what to suggest to France. That is the toughest
question. They are losing labor competitiveness with Germany and
others, and already have taxes that cannot go much higher, large
fiscal deficits, poor demographics, and huge future unfunded
liabilities in the form of health-care and pension benefits. They
have time to get things sorted out if they will use it (like the
US). The world surely hopes they do. The concern about the
problems of French banks was voiced everywhere in Hong Kong and
Singapore. They are integral to world trade in ways that US banks
(or others) can't come close to. They just have the experience
and infrastructure in making those trade loans. You can't build
that up in a short time. A problem with French banks would be a
problem for world growth, which is already slowing down.
I know the markets are discounting a happy ending to the euro
crisis. I just see the substantial "tail risk" and suggest you
manage accordingly. Large pensions and foundations may be happy if
they end the year where they started. Smaller investors should
assess their risk tolerance from the perspective that Europe does
not work through its problems.
Next week, we get to the US. If you think Europe has
South Africa and Sweden
I came back to Dallas by way of Tokyo. As I walked to my gate, I
noticed a crowd and then lots of cameras. Clearly a celebrity of
some import was getting on the plane. I boarded and went to my seat
in first class (you've got to love system-wide upgrades!). I asked
the steward (who I knew from previous flights, which says I have
been on too many) who was getting on. It turned out it was Yu
Darvish, the best baseball pitcher in Japan, who Nolan Ryan had
just signed to pitch for my Texas Rangers. He is young (25), good
looking, and quite tall at 6'5". And he seemed the perfect
gentleman, smiling and quite willing to sign autographs. Yes, I got
one, but it was for my kids. I'll just save it for them for a
while. The Texas fans are going to love him. He just has that
charisma. Let's hope he can keep his sub-2 ERA when he pitches in
The Ballpark. Then they'll go crazy.
The letter is already too long to write much this time about
Hong Kong and Singapore, but I would be hard-pressed to say which
city impressed me more. I was blown away. I thought I was prepared,
but you really do have to see it for yourself. I am going to spend
more time in Asia. And soon, thanks to the team at the
Hong Kong Economic Journal.
What an honor to work with such a venerable and prestigious paper.
(They translate my letters into Chinese and give them a full page
each Monday and Thursday, as well as post them online.)
Next week is busy with meetings, writing, and deadlines. Barry
Habib comes to Dallas to help launch our new institutional research
publication with Bloomberg. Then Wednesday a week I will be with
Rich Yamarone (Bloomberg Chief Economist), Dr. Woody Brock, and
Mark Yusko at the Annual Dallas CFA Forecast Dinner. We hope to be
able to get together the previous night for some fun and maybe a
little discussion of the markets (d'ya think?). The panel should be
quite entertaining. Then I'm off to Cape Town, South Africa for two
days to speak for Rand Merchant Bank at their fixed-income
conference. (I will try and stay on Texas time if I can!)
It is time to hit the send button. It is the wee hours of
Saturday morning and I am still on Asia time, it seems; but I need
to get to bed and try to adjust. Have a great week!
John Mauldin is president of Millennium Wave Advisors, LLC, a
registered investment advisor. All material presented herein is
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