Monday, February 25, 2008
Macro Man is back in the saddle after a week on the slopes, and to be honest it's difficult to see much that's changed.
Equities going nowhere fast? Check.
A monoline rescue plan in the works? Check.
Inflation uncomfortably high in the US and elsewhere? Check.
Banks still taking underperforming, unsaleable assets onto their balance sheets? Check.
OK, a few things have changed. The dollar's a bit weaker on a broad basis, but surely that's what you'd expect given the negative interest rates at the short end? Similarly, the continued weakness at the back end of the yield curve couldn't have been much of a surprise given last week's horrible CPI number. And frankly, $100 oil and gold within spitting distance of a grand don't exactly suggest that that dynamic is going to roll over any time soon, are they?
Macro Man often finds that time away from the market provides an opportunity to reflect on longer term themes. This year, he found himself musing on the impact of climate change more often than not.
Perhaps it was the cost of the flight, boosted by taxes and rising fuel costs.
Perhaps it was the fact that he was skiing with a friend who runs a large energy fund and remains rampantly bullish on oil.
Perhaps it was the fact that as a winter holiday comes to a close, one's thoughts naturally drift towards making plans for the summer.
Regardless, as Macro Man practiced his telemark technique high up in the Alps (pictured, left), he found himself thinking about global warming a lot.
OK, the snow wasn't THAT bad. But it's been more than two weeks since the last snowfall, so things did get a bit slushy over the last couple of days.
Hmmm....perhaps it's just a case of UBS's future overlords wanting to make themselves at home?