Caveat Emptor...Not

Just buy it. Close your eyes and buy it. Not an investment strategy that would hold up under much scrutiny admittedly, but then when you’re bringing in the $$$$$$$$, no one asks questions. The Bears and Sino-sceptics were surely getting very excited as China took a dirtnap on talk of CCB and ICBC lassoing the rampant bull that is lending and reining it in. Admonishing utterances of “I told you so” and “I knew it,” were fleeting however as the rest of the world paid attention for all of about 5 minutes before the market realised it had been sliding for far too long (1 day) and decided to about turn.

To be fair, we’ve had some better figures today in the form of Bayer, Peugeot, Nissan, Santander, Assa Abloy and now Daimler. There’s talk Natixis may have better numbers too, and also that they may have some side fund to place their toxic assets, which will of course, solve everything for them. We did also see UK mortgage approvals up although the deflationistas claimed another notch as M4 fell in June and German CPI came in lower. Nevertheless, the China move should have been big news to the market, right?? The China story has been the wind (gale force in nature) beneath the wings of the market, and within that the pickup in domestic lending has played a crucial role (even if most is going to government sponsored projects). So when this thesis is questioned, surely markets should have reacted more punishingly? I refer you to Line 1 above.

One group that still isn’t buying is that of company insiders. PragCap today highlights that recent weeks have seen just $26m of insider buying, and actually, given one buyer accounted for $16.5m, the clean number is a paltry $9.5m. The sell side tells another story however, with $300m on sales. That’s one serious buy: sell ratio on a “clean” basis…and given that how anything that can be stripped out, is stripped out these days, that’s probably an appropriate way to look at things.

But then all that’s been going on for a long time now and the market keeps going up, and I hear instos are buying today…and on decent volume. There’s a big wall of money to come remember, so just buy it, close your eyes and buy it…