Investment Markets Overview — W/E 15th May 2015

Pablo Picasso’s painting,”Les Femmes d’Alger,” or “Woman of Algiers” sold for a record price at auction this week, at $US179.4m, $160m + $19.3m commission, having been originally acquired as part of a series back in 1956 for $212,500 and last sold in 1997 for $31.9m. “At auction” is emphasised as it’s rumoured that a private sale record of $US300m was paid earlier this year for a Paul Gauguin. The auction at Christie’s New York this week also set a record $141.3m paid for a life-size sculpture by someone called Giacometti. The purpose of mentioning these fine items isn’t that yours truly has any new found interest in art, but more about the timing of such sales and in respect of the interpretation of “liquidity.” On the timing front, record price sales, whether they are accorded to Art, Wine, Cars and trophy real-estate, tend to accompany market tops for financial assets in general. Warning one! Secondly, a well-known financial market commentator was asked to comment on the aforementioned sales on BBC radio, to which he answered, “it’s symptomatic of too much money sloshing around, created by the Central Banks.” He is partially correct in respect of the CB’s, but the actual amount of money created is but a fraction of the leverage employed to it and it is this leverage (debt by a fancy name) that has driven up financial assets of all stripes, art included. Leverage, however, is a double-edged sword.

15 May 2015

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Additional Commentaries:
•US economic data . . .
•Euro-Zone . . .
•The UK . . .
•Out East . . .
•The $US index . . .
•Within the commodities complex . . .
•Economic data due next week includes . . .

Investors’ relaxed a little this week as Greece successfully completed its latest €750m debt repayment to the International Monetary Fund ……

Charts:
1.  Indices Weekly
2. US Business Inventories Monthly V Year on Year
3. UK House Prices V RICS Sales-Stock Ratio
4. Japan Exports V South Korea Exports
5. Commodity YTD  Moves

Table:

13 Indices, 11 columns of detailed information, for accurate analysis

“The End of the Road Appears to be Very Close Now.

Click Here to view Details of the full version of this Newsletter which includes full text and detailed

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