Somehow the market heard us coming.
Just as we were getting around to drafting a more bullish trading call on the Russian equities, the thundering herd came charging ‘round the corner, and T&B narrowly missed being trampled as they headed for the feeding trough. Happy times – apparently – are here again!
Thus, we have been compelled to cut short our philosophical ruminations in the interest of timeliness (that plus the fact that there are a couple of good parties this weekend, and we have to put this baby to bed before we can go anywhere with good conscience).
In brief, we are increasing our exposure to high-beta assets, in particular the Russian equity market, while beginning to take some profits in the fixed income space, and are increasing our shorts of Euros, Dollars (and possibly Yen) in favour of Asian and emerging market currencies.
We reiterate our China-buys-the-world theme, as well as our concerns with an impending sovereign debt crisis which will soon enough create much havoc in the West.
Meanwhile, Moscow shows signs of preparing to embark on another boom.
Judging from the traffic to the parties, that brief period of calm which followed upon the crisis appears to be ending. The construction cranes are again working, while the Maybachs and Rolls are again in evidence. Moscow is hoping with new galleries, and at its best is taking on a distinctly post-modern flavour – quite a change from the previous post-Soviet model.
Although many of the oligarchs had been pronounced dead, they have apparently found the secret of resurrection. The Hyatt is once again filled with foreign investors looking to put their idle funds to work.
Russian capitalism remains red in tooth and claw however the rate of post-crisis recovery of the financial sector is quite extraordinary.
Abandoned for dead a year ago, the banking sector is recovering smartly, with a major transfer of property underway as they seize all the distressed assets within their grasp.
Signs of the crisis are still in evidence – notably the salaries demanded by new employees have come back into some relationship with reality – however we see it as only a matter of time before it gets foamy again.
Enjoy the run!
Once again, T&B would remind our readers that they are welcome – indeed – are encouraged TO FORWARD T&B TO ANY INTERESTED PARTY. We write in order to be read.