The "What Ian Can See" WICS trading information newsletter - past edition.
Ian's weekly look at the world economic situation. Members get access to the current edition, archives, chart analysis and one-to-one mentoring on your trading.
February 17th 2019
Gosh - doesn't a week travel fast these days? Must be to do with one of Elon Musk's hypersonic inventions!
Anyway, here we are again, past the middle of February already, English school mid term holidays started, Grandsons numbers One and Two here till late pm next Sunday, so much work ahead for this fella! Firewood is their thing at the moment - as in watching me cut and split it (from a suitably safe distance) then helping to stack it all incredibly neatly before we all head into the wood to drag the next load out and get it to the shed. They're real wee slave drivers! Sadly, the trout fishing season isn't open yet so I can't even tempt them into a bit of relaxation. Work work work - but isn't it encouraging to know that at least some small people have zero interest in electronic devices, and want to be outdoors for as long as possible every day? The last thing I would dream of doing is discourage them!
Given the presence of the slave drivers, mentoring emails will take longer than usual to deal with - just so you know! Likewise this ramble will perhaps be a tad on the brief side, albeit with plenty links to compensate for my lack of verbosity - nevertheless there's still a good ol' IW rant to look forward to as you continue down the page.....
Moving along (gosh - an opening paragraph or two with no mention of the B-word!) it amused me to note the alleged Brussels drinking establishment indiscretion by Olly the Brexit Boy. Don't you think his words were pre-planned and approved by St T the Useless to be "leaked" to the journos? The whole thing certainly smacks of that to me. And as for Failing (Utterly Failed) Grayling's non ferry contract and the equally non due diligence his department didn't carry out, yet paid "consultants" £800000 not to carry it out.... Well, there's definitely more than a whiff of corruption hanging in the air around that eh! Something fishy about a Grayling perhaps? I note that Brit and Yank scientists are to receive more dosh to upgrade black hole detectors. Perhaps the money would better be spent on bullsh*t detectors? There again, I guess most of us can easily detect that kind of thing nowadays, after so much non stop exposure to it? Only a total moron would rate a politician very highly these days eh?
Not to fret folks - that's all the Brexit reference done for this weekend!
I lied..... Just one more thing, as touched on last weekend - maybe the EU has as much to lose as would Blighty, in the event that "no deal" becomes "the deal"? For example, I note that Eetallee is making noises about maybe bypassing all these annoying Brussels rules and dealing directly with us rather than seeing their exports trashed. Methinks Druncker and Barmier are a lot more scared than they're letting on. If Blighty does leave with "no deal" (something that's a whole lot more likely perhaps, than people meantime believe) and nothing really bad happens as a result (which I'm sure would prove to be the case despite the fear meter meantime being set at eleven by the Remain lot) then the rest of Yoorp could well start scratching its collective eyes out in a major cat fight. Certainly, the EU is by no means in rude economic health, again as suggested here last weekend. Here's a Bloomberg piece to consider.
And Yankland ain't in rude health either, of that we may be certain.
Seemingly - according to Bloomberg, American retail store closures since the New Year are up 23% on the same period last year.
In fact - despite the rather ludicrous behaviour of Mr Market of late - the bears are right to be bearish! Well, I would say that, wouldn't I? Rest assured though, I'm not alone.
There is absolutely nothing in the financial world at the moment that could remotely be considered as structurally bullish, no matter how much complacency there might be overall. Indeed, it's that level of complacency that's one of the most important signals that the end (of ongoing stock market euphoria) is nigh. I note that Yank mutual fund managers currently hold just 2.9% cash - the lowest ever level thereof. They expect only rising asset prices, with zero downside risk. Optimism is at an all time high among these folks. Oops.
Back in Blighty, I note Bloomberg's view that Jag Land Rover will go bust some time in the next five years. I give them perhaps three years at most. What a disaster zone of a company! "The Art of Performance" is their thingie. Perhaps "Underperformance" suits a wee bit better. Would you want to hold shares in Tata Motors? Ta-ta......
Likewise, I note that BP is "warning" us that reduced plastics use will cut global oil demand. Hmm - a bad thing or a good thing, I wonder? Bad for shareholders and employees of course, but perhaps not so bad for the planet. My only concern is that less by way of plastics, means more by way of cardboard, and even more deforestation looms as a result - it's already happening of course via this whole "biomass" nonsense that isn't exactly helping the planet, nor its wildlife....... Mention of which brings me to the promised (threatened?) rant.
If you have suffered these ramblings for any length of time (again, my sincere thanks!) you'll be aware that quite a while ago I mentioned the lack of wee beasties getting squished on my windscreen during the various Williams pilgrimages, and I compared that situation to many years previously when I could hardly travel twenty miles of a summer's evening before having to debug the windscreen. However, despite recognising the fact that insects were getting fewer and fewer, I confess I had no idea just how bad matters had become. Have a read of this and be very, very worried.
Global warming? Totally unimportant! Plastics pollution? Pretty important! Insects disappearing? Totally disastrous! Seriously, this is the biggie and without extreme measures taken pretty smartish, starvation looms for much of the planet's population. As you may know, I'm from farming stock and indeed I'm still (albeit hobby) farming. Sadly however, as my late great friend Magnus Magnusson once observed, "Farmers are not the best custodians of the countryside" and with that I am forced to agree. Don't tell me it's global warming and plastics pollution that are causing insect populations to crash. It's down to chemicals companies and their ability to lie their socks off with impunity (politicians on the payroll....) about the allegedly beneficial, fluffy effects of the toxins they sell to farmers in order to increase yields. Likewise, too many greedy farmers rip out anything that might harbour a "crop pest", increase field sizes, and plough them to within an inch of the boundary. There are exceptions of course, particularly among the game shooting fraternity whose farms are usually laid out with plenty of conservation areas, hedgerows allowed to grow properly, wildflower strips, beetle banks and the like. I said I wouldn't mention Brexit again but the current Brussels "conservation" incentives and "farm stewardship" schemes are to be lauded and hopefully Blighty will continue these and develop them even further. It's pretty simple really. If the insects all die, we all die. We can survive a bit of warming. We can even survive with the oceans swimming in litter. But nae insects = nae chance of survival!
I noted the other week (irony - I love it!) a piece in one of the magazines I occasionally waste money on, written as a riposte to so-called Veganuary. The writer is a "big farmer" and he was making the point that an awful lot of beasties die in the production of a loaf of bread, so if vegans are against suffering there's really very little they can eat. Inter alia, he pointed out that if you find one Orange Wheat Blossom Midge per six ears of your maturing wheat crop, "it's out with the sprayer" and "that's 833333 midges per hectare. Dead." And that's just one insect among zillions of others that get sprayed out of existence every year - for example, what about the Daddy Longlegs? When did you last see a whole bunch of those lovely beasties on the wing of a balmy late August evening?
Nope - they were killed by a spray, just below the soil surface while they were still wee grubs. And so it goes on.......I'll end this rant (for now) with a cartoon that says it all:.
OK - on that rather depressing note (justifiably so however!) onward to some charts. First there's a look at Smurfit Kappa, given my "cardboard" mention earlier. There's a pretty clear countertrend channel to be seen at the moment, so the overall suggestion is that prices have lower to go. Nevertheless there's a level a wee bit higher, which if broken would lead to considerably higher prices still. Next, DS Smith has just pushed up the merest tad out of a wee triangle. It has the look of a stock that could continue higher still. Then there's a "big picture" triangle to be seen on the chart of Diversified Gas & Oil. What might that suggest, I wonder? Finally, there's a wee rising wedge on the S&P 500 picture. This latest few days of upwards push wasn't entirely unexpected after the earlier triangle was broken, and often there's some extra "feel good" to take into account when a holiday weekend is due (Monday is President's Day when Washington's birthday is celebrated in Yankland, and markets are closed.) Anyway, whatever - there's a price level here that bears watching!
That's all for this weekend then folks - it's back to the log pile for me now! Work, work work. It never ends. Thank goodness!
Due to the wee slave drivers being here till next Sunday afternoon when I need to drive 'em to the airport with their Mummy, there will be no ramble next weekend, so I'll see you again on March 3rd. All the best, and Happy Trading until then! (I'll be here to answer mentoring emails of course, so don't hesitate to get in touch between now and the 3rd.)
The rest of this post, which is the charts and analysis, is available to TEW course members only. Members receive the latest post, the archives, plus the manuals, video updates and one-to-one mentoring from Ian Williams via email.
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