Montreal, Canada

Is it the beginning of the end for the EUR?

Amazing how things can change in just a short period of time. Only a few months ago my phone was ringing off the hook as worried investors demanded more EUR exposure at the expense of a falling American dollar. Happily, I discouraged this trade at such low levels and instead, advised my investors to buy more gold because both drunken units had been falling like a rock vis-à-vis gold since 2005.

Montreal, Canada

One of the strongest currencies vis-à-vis a resurgent American dollar since December remains the Canadian dollar. Portfolio flows into Canada soared in 2009 as the country drew record amounts of institutional cash into stocks, bonds and the Canadian dollar. Real estate has also been strong with residential prices now at new all-time highs after briefly declining in 2008.

Montreal, Canada

It was no surprise to most market participants that Germany and the European Central Bank (ECB) announced a meeting tomorrow in Brussels to discuss debt guarantees and bridge-financing for ailing Greece. The EUR got a small boost after the announcement while credit spreads on German/Greek issues narrowed for the first time in weeks.

Montreal, Canada

According to Bloomberg, bearish bets against the EUR by hedge funds and other institutional investors hit an all-time high this month at $7.6 billion dollars. That's the highest dollar concentration of bets against the single European currency since its introduction in 1999.

Massive bearish bets are indicative of a heavily overbought U.S. dollar. Or alternatively, is the EUR still vulnerable to further selling ahead of a possible interest rate cut?

Montreal, Canada

Gold's decline from a nominal high of $1,216 an ounce in early December to $1,053 this morning is drawing a rising chorus among some distinguished bears that the nine-year bull market is over. Some pundits claim gold is in a bubble.

The world's greatest hedge fund manager since 1969, George Soros, was recently quoted on Bloomberg claiming "gold is in a bubble" while renowned economist, Nouriel Roubini, believes the gold bull market is over. In the absence of inflation, the latter thinks gold should be sold.

Zurich, Switzerland.

Global stocks suffered their worst single day of performance on Thursday in almost a year. Investors haven’t seen this sort of decline in months and I reckon many are starting to wonder if the recent fantasy rally is now officially over. At the very least, it’s fair to conclude that we’re in a correction at this point with risk-based assets plunging yesterday.

Zurich, Switzerland

It's always interesting to visit the Fund Fair in Zurich, or Funds 2010. Each year in early February some of the biggest and most prominent traditional and alternative asset managers attend this investment show, including some great speakers. Later this afternoon I'll be hearing Jim Rogers on commodities – one of my favorite investors.

Held at the Kongresshaus in Zurich and located across the street from beautiful Lake Zurich, the Fund Fair this year offers more index-linked providers than last year.

Zurich, Switzerland

Global warming is definitely not evident in Zurich this month. For the first time in memory, there's more snow covering the streets here than back home in Montreal. The weather is damp and you need rubbers to cover your shoes if you walk the city's beautiful streets. I had to buy new shoes yesterday because my soles were completely saturated by the pools of snow and slush.

- Dugald Malcolm

Montreal, Canada.

On the morning of January 22nd I wrote about the possible breakdown of support of the S&P 500. By the close of the market later that afternoon, the breakdown was indeed confirmed. The S&P 500 had crossed an important level of support at 1,115 to close the day at 1,091.76, down 2.21% from the previous trading day's close.