Newsletter - Ride out the storm - December 2011

When some traders say that the current market is perfect for trading, we think precaution is more important.

 
Eurocrisis affects The World

Whatever happens with the euro will have an impact upon every major economy in the world.
This is true not only because it involves the largest economic zone in the world, but also because it is the largest trading block in the world. It’s impact will be felt globally.

In fact, the affects of the euro crisis are already evident, and not just in the eurozone. The hard reality is that China’s exports to euroland have, in the words of Bloomberg.com, “fallen off a cliff.”

The euro crisis, like the debt crisis in the US, is a political failure with huge economic costs coming with it. If the euro is to survive, then severe austerity measures will be put in place throughout much of the eurozone, which means deep economic cutbacks.

But , if the euro does not survive, and nations revert to their own currencies once again, there will likely be very difficult economic times ahead as well.

How does the crisis impact on our trading

All our systems supervise the risk in the market and reduce or stop the trading when the risk levels are too high. Our systems have, on several occasions during the last couple of months, found that the risk levels are too high. As a consequence our systems have traded less than normal.

During 8-9 December there is a meeting with the European Council. As a precaution we will stop our trading completely for the duration of their discussions. When the meeting is over, we plan to resume our trading in full scale.

I wish you a nice December 2011. Lets ride out the storm.


Henrik Ekenberg
CEO Finansium AB