Fin dai primissimi giorni, avete trovato in Recce’d un punto di riferimento chiaro, trasparente, coerente, e un solido ancoraggio alla realtà, per ciò che riguarda la vicenda coronavirus ed il suo impatto sui nostri portafogli di investimento.

I fatti non ci hanno costretto (almeno fino ad oggi) a fare marcia indietro: il nostro atteggiamento sulla vicenda coronavirus è il più appropriato dal punto di vista di un investitore sui mercati finanziari.

Poi a distanza di ormai cinque settimane abbiamo trovato (e ci ha fatto piacere la circostanza) sul Wall Street Journal un eccellente articolo, che abbiamo deciso di riproporvi per intero, nel quale si suggerisce di adottare esattamente la medesima linea di comportamento e la medesima logica per la valutazione dei fatti presenti e futuri.

On Monday evening, Apple warned its shareholders about the effects of the new coronavirus outbreak. Production of iPhones has been slowed because of quarantined workers, and the company expects to sell fewer products in China as the country grapples with the problem.

Revenue, Apple said, will take a hit, though it wasn’t ready to estimate just how big. It seemed the kind of warning, from a company worth $1.4 trillion and a mainstay of investors’ portfolios, that might inspire quite a sell-off on Wall Street. After all, if the supply chain wizards at Apple can’t keep things going because of coronavirus, what other problems might emerge that ripple through the global economy?

But Wall Street, in the end, mostly ignored it. The S&P 500 fell a mere 0.3 percent Tuesday, only to recover all of that ground and more Wednesday. By the close of trading Wednesday, even Apple stock recovered to nearly where it had been before the announcement.

It fits a pattern: The stock market has barely reacted despite the idling of countless factories in China as workers are quarantined, and despite fears that the virus could spread more widely and create further economic disruption across Asia and beyond. The S&P 500 is actually up 5.6 percent from its levels at the end of January, when the World Health Organization declared coronavirus a global health emergency.

Even shares of American companies with the most direct exposure to the Chinese economy are holding up fine. The Dow Jones travel and tourism index, which includes airlines and hotel chains that would suffer from a drop in Asian tourism, is down a mere 1.2 percent since mid-January, when the coronavirus fears started to become widespread.

This buoyant mood in the stock market has continued even as economic forecasters have downgraded their projections for global growth in 2020 and warned that in less likely but more grim scenarios, the world economy could face a major hit as commerce sputters in affected regions.

For example, Moody’s Investors service this week described a baseline scenario in which the virus was contained in the first quarter. If that were the case, the economic damage would probably be limited to temporary disruptions and to supply chains and tourism. But the firm also raised the possibility of something more damaging.

“The toll on the global economy would be severe if the rate of infections does not abate and the death toll continues to rise,” Moody’s analysts wrote. “Extended closures in China would have a global impact given the importance and interconnectedness of China in the global economy. The financial market reaction seems to have been to mostly shrug off the impact, which may underestimate the risks.”

At first glance, it might seem as if there are only two possibilities: Assessments like that one are too gloomy, or the stock market has failed to incorporate a major risk to the outlook. But when you look at the full range of data, there is another way to reconcile things.

Bond markets have appeared markedly more pessimistic than the stock market, with the yield on 10-year Treasury bonds falling to 1.57 percent Wednesday from about 1.8 percent in mid-January. That suggests bond investors envision lower growth, and hence lower interest rates, over years to come.

And two-year Treasuries are yielding a mere 1.43 percent, below the Fed’s current target for overnight interest rates of between 1.5 percent to 1.75 percent. That implies investors think it increasingly likely that the Fed will cut interest rates again this year.

Coronavirus is part of the reason. Minutes of the Fed policy meeting in late January that were released Wednesday said that “the threat of the coronavirus, in addition to its human toll, had emerged as a new risk to the global growth outlook, which participants agreed warranted close watching.”

In effect, stock investors seem to be betting that the Fed will bail them out of any damage that the virus might to do to corporate profits and the world economy. A Fed rate cut or two would make money cheaper, and therefore support high stock valuations even in an environment in which major companies that do business in China or other affected countries had to shutter production or absorb lost sales.

It’s a plausible story. But it also points to one of the big worries about the valuations of all sorts of financial markets in the 11th year of the economic expansion.

The stock market keeps hitting new highs, but it has required repeated shifts toward easier money by the Fed to make it happen — most recently, last summer and fall. Back then, the trade wars and other global factors seemed at risking of tipping the United States economy into a slowdown, and the Fed cut its key interest rate three times.

The rate cuts did their job, financial markets rebounded after some summer turbulence, and now the United States economy seems to be cruising.

But the Fed is also facing the very real problem that interest rates are so exceptionally low even in good times that it has little room to maneuver if the economy takes a significant turn for the worse.

Its target interest rates are barely above 1.5 percent, and if the Fed has to cut further to protect the United States economy against a shock from a virus that emerged in Wuhan, China, it has less capacity to deal with some potentially larger disruption closer to home.

Using the power of monetary policy to combat a potential pandemic, in other words, would leave the central bank with less capacity to fight some future, unknown challenge.

So stock investors who remain bullish despite the coronavirus risks are in effect making two big bets rather than one.

First, they are betting that the Fed can and will act if necessary should the virus start to do real damage to the economy. Second, if that were to happen, they are betting that the Fed’s diminished capacity to deal with future shocks won’t be a problem.

If you think the world is full of risks in the years ahead, the economic disruptions from coronavirus ought to be only the beginning of your worries.

Neil Irwin is a senior economics correspondent for The Upshot. He is the author of “How to Win in a Winner-Take-All-World,” a guide to navigating a career in the modern economy. @Neil_Irwin 

Come scriviamo anche oggi nella nostra pagina di ricapitolazione settimanale, in questo momento la nostra strategia di investimento è chiara come in poche altre fasi di mercato.

Anche i dati che sono stati pubblicati negli ultimi giorni, inclusa la produzione industriale in Eurozona che vedete sotto con la linea di colore rosso) contribuiscono a chiarire la situazione, anche se per ora i mercati (la linea di colore blu del grafico) sono vittime di una fase di euforia che è stata alimentata dai mezzi di informazione.

Non ci faremo di certo mandare in confusione da queste oscillazioni di brevissimo termine di pochi indici di mercato: ci siamo già passati, ci siamo già stati, ed abbiamo già vinto in passato, e non una sola volta.

Non siamo ingenui, non siamo sognatori, e non siamo più bambini: abbiamo smesso da tempo di credere alle favole a lieto fine, ai supereroi del cinema di Hollywood, ed alle pillole della salute che fanno vivere 120 anni.

Ed anche a quella felicità “garantita dalla liquidità delle Banche Centrali”.

Liquidità che, come tutti sanno, garantisce benefici solo di breve termine. E’ un palliativo. E’ un placebo.

Come già abbiamo scritto in altre occasioni, però, le fasi di mercato in cui tutto sale fanno sentire anche il più piccolo investitore come un Dio dei mercati, che è capace di dominare le onde dell’Oceano facendo surf sulla propria piccola tavola.

Come vedete nell’immagine qui sotto, tutto dipende poi da come si scende, da quella tavola.

Ma oggi una buona parte degli investitori si è fatta mandare in confusione dal miraggio di una “eterna felicità ed illimitata ricchezza”. Questi investitori non sono più lucidi, e prendono decisioni affrettate sotto la pressione della psicologia di massa, e commettono quindi errori che pagheranno a breve.

Allo scopo di rendere utile il nostro lavoro anche per chi crede … nelle pillole dei 120 anni, ci pare utile proporre in lettura i seguenti due commenti della settimana scorsa, che arrivano da due esperti operatori di mercato, che hanno la capacità di mettere in evidenza sia gli eccessi della attuale situazione di mercato, sia gli eccessi che dominano oggi nella psicologia di massa.

From my perch we’re in the midst of a giant Fed induced asset bubble and I’ve written extensively about it. In my view the Fed is reckless, irresponsible, and unaccountable and their liquidity actions are setting up investors for a disaster to come.

Each bubble has its voices and in hindsight in particular they offer testimony to how dangerous markets really were at the time, how obvious the risks ignored were, yet so ignored by participants as momentum kept rolling on before the rug gets pulled.

Hence I thought it might be of interest to document some of these voices:

Guggenheim’s Minerd, a $275B money manager:

“Guggenheim Partners Global CIO Scott Minerd said in a letter to clients that the elevated prices in financial markets show a “cognitive dissonance” from economic reality that has created a dangerous bubble among debt assets.

Liquidity from the Federal Reserve and other central banks and increased demand for bonds from ETFs are masking the problems in the market, Minerd said, and the coronavirus outbreak is an example of an economic shock that could prick the bubble. The money manager said GDP growth in China in the first quarter could be as bad as negative 6%.

“This will eventually end badly. I have never in my career seen anything as crazy as what’s going on right now,”

“In the markets today, yields are low, spreads are tight, and risk assets are priced to perfection, but everywhere you look there are red flags,”

“We are either moving into a completely new paradigm, or the speculative energy in the market is incredibly out of control. I think it is the latter. I have said before that we have entered the silly season, but I stand corrected,” Minerd said at the end of his letter. “We are in the ludicrous season.”

Then from Mark Spitznagel, the founder of Universa Investments:

Right now, stocks, with the Federal Reserve winds blowing at their backs, are “distorted” and “no longer tethered to fundamentals,” Spitznagel warns, and that makes for those chasing returns extremely vulnerable.

“These monetary distortions lead to this reckless reach for yields that we are all seeing,” he said. “Randomly go look at a screen and it’s pretty crazy. Big caps, small-caps, credit markets, volatility; it’s crazy. Reach for yield is everywhere.”

Una potente macchina di persuasione di massa si è immediatamente messa in moto, prima ancora che le notizie uscissero sui mezzi di comuncazione, per convincere il Mondo che il coronavirus è un problema serio ma gestibile, che non sfuggirà dalle potenti mani dei Governi investiti dalla questione.

Normale: normale che si vogliano evitare momenti di panico ed episodi di isteria collettiva.

Molto meno normale che per evitare queste forme di isteria collettiva si sia alimentata un’altra isteria collettiva.

Ad un occhio lucido ed esperto risulta del tutto inspiegabile il perché anche in questa occasione sui mercati finanziari si sia registrata una situazione del tutto schizofrenica.

Da una parte, i mercati delle obbligazioni, delle materie prime, e dei cambi tutti sbilanciati verso la prudenza, per non dire la negatività. Dall’altra le Borse, soggette a episodi di euforia come se fossero in preda agli allucinogeni.

Ovvio che l’euforia viene alimentata, in Borsa, da chi ha interesse ad alimentarla: difficile invece capire perché molti, moltissimi investitori VOGLIONO, desiderano essere illusi, desiderano “continuare a sognare”, e voglio credere in una Borsa che “non può più scendere, mai più”.

Forse, la massa degli investitori crede davvero ai supereroi: forse crede che esista un supereroe come quello dell’immagine in altro, che digitando una serie di Tweet sul suo smartphone può risolvere i problemi del mondo reale.

Essendo questo Blog un servizio rivolto al pubblico, che deve quindi occuparsi del pubblico, come ad esempio la salute (mentale) pubblica, riteniamo appropriato sottoporre all’attenzione dei lettori una parte di un articolo pubblicato in settimana, a firma di uno dei più autorevoli commentatori del Pianeta. Articolo che spiega che è inutile stare con gli occhi al cielo sperando di vedere passare Superman.

Meglio guardare alle cose reali del Pianeta Terra.

Il tema riguarda molto da vicino i vostri investimenti, i vostri soldi, la vostra performance: vi aiuterà a capirlo il commento che segue al grafico del Wall Street Journal.

Chi è interessato ad approfondire, potrà ascoltare anche le parole pronunciate in questo video di Barron’s. Noi di Recce’d abbiamo chiarito, ci auguriamo a sufficienza, la nostra opinione sul tema coronavirus fin dall’inizio, ed anche in modo pubblico, nei tre precedenti Post che hanno questa serie con il titolo che leggete in alto.

La settimana scorsa, nel primo Post con questo titolo, vi abbiamo aggiornato sul tema della crisi che si prolunga da ormai un semestre senza soluzione di continuità, che investe il mercato USA della liquidità interbancaria, che coinvolge direttamente la Federal Reserve, e che sarà uno dei fattori più importanti nel determinare il futuro (anche prossimo) dei mercati finanziari globali.

In quel Post della settimana scorsa, vi abbiamo chiesto di leggere un articolo del Financial Times del quale, poi, la settimana scorsa si è parlato ogni giorno tra gli operatori di mercato.

Tra i tanti commenti all’articolo, noi abbiamo selezionato per voi lettori quello che a nostro parere è il più significativo.

Noi continueremo ad informare in modo analitico i Clienti su questa vicenda, che va aumentando di importanza sui mercati finanziari anche se vine fatto ogni possibile sforzo per tenerla nascosta.

Esattamente comi si fa, in altri contesti, quando scoppia un’epidemia virale.

Se per caso qualcuno vi ha detto che questo argomento non è importante. Che è soltanto una tecnicalità. Che non inciderà sui prezzi delle azioni e delle obbligazioni. Allora fatevi una vostra idea: guardando i dati del grafico che segue.

Ve la sentite, di dire che “non sta succedendo nulla di strano”?

Vi lasciamo alla lettura dell’articolo che trovate più in basso.

On February 5th, 2020, Dominic White, an economist with a research firm in London, wrote an article published by the FT entitled The Fed is not doing QE. Here’s why that matters.

The article presents three factors that must be present for an action to qualify as QE, and then it rationalizes why recent Fed operations are something else. Here are the requirements, per the article:

1. “increasing the volume of reserves in the banking system”

2. “altering the mix of assets held by investors”

3. “influence investors’ expectations about monetary policy”

Simply:

1.  providing banks the ability to make more money

2.  forcing investors to take more risk and thereby push asset prices higher

3.  steer expectations about future Fed policy. 

Point 1

In the article, White argues “that the US banking system has not multiplied up the Fed’s injection of reserves.”

That is an objectively false statement. Since September 2019, when repo and Treasury bill purchase operations started, the assets on the Fed’s balance sheet have increased by approximately $397 billion. Since they didn’t pay for those assets with cash, wampum, bitcoin, or physical currency, we know that $397 billion in additional reserves have been created. We also know that excess reserves, those reserves held above the minimum and therefore not required to backstop specified deposit liabilities, have increased by only $124 billion since September 2019. That means $273 billion (397-124) in reserves were employed (“multiplied up”) by banks to support loan growth.

Regardless of whether these reserves were used to back loans to individuals, corporations, hedge funds, or the U.S. government, banks increased the amount of debt outstanding and therefore the supply of money. In the first half of 2019, the M2 money supply rose at a 4.0% to 4.5% annualized rate. Since September, M2 has grown at a 7% annualized rate. 

Point 2

White’s second argument against the recent Fed action’s qualifying as QE is that, because the Fed is buying Treasury Bills and offering short term repo for this round of operations, they are not removing riskier assets like longer term Treasury notes and mortgage-backed securities from the market. As such, they are not causing investors to replace safe investments with riskier ones.  Ergo, not QE.

This too is false. Although by purchasing T-bills and offering repo the Fed has focused on the part of the bond market with little to no price risk, the Fed has removed a vast amount of assets in a short period. Out of necessity, investors need to replace those assets with other assets. There are now fewer non-risky assets available due to the Fed’s actions, thus replacement assets in aggregate must be riskier than those they replace.

Additionally, the Fed is offering repo funding to the market.  Repo is largely used by banks, hedge funds, and other investors to deploy leverage when buying financial assets. By cheapening the cost of this funding source and making it more readily available, institutional investors are incented to expand their use of leverage. As we know, this alters the pricing of all assets, be they stocks, bonds, or commodities.

By way of example, we know that two large mortgage REITs, AGNC and NLY, have dramatically increased the leverage they utilize to acquire mortgage related assets over the last few months. They fund and lever their portfolios in part with repo.

Point 3

White’s third point states, “the Fed is not using its balance sheet to guide expectations for interest rates.”

Again, patently false. One would have to be dangerously naïve to subscribe to White’s logic. As described below, recent measures by the Fed are gargantuan relative to steps they had taken over the prior 50 years. Are we to believe that more money, more leverage, and fewer assets in the fixed income universe is anything other than a signal that the Fed wants lower interest rates? Is the Fed taking these steps for more altruistic reasons?

Bad Advice

After pulling the wool over his reader’s eyes, the author of the FT article ends with a little advice to investors: “Rather than obsessing about fluctuations in the size of the Fed’s balance sheet, then, investors might be better off focusing on those things that have changed more fundamentally in recent months.”

After a riddled and generally incoherent explanation about why QE is not QE, White has the chutzpah to follow up with advice to disregard the actions of the world’s largest central bank and the crisis-type operations they are conducting. QE 4 and repo operations were a sudden and major reversal of policy. On a relative basis using a 6-month rate of change, it was the third largest liquidity injection to the U.S. financial system, exceeded only by actions taken following the 9/11 terror attacks and the 2008 financial crisis. As shown below, using a 12-month rate of change, recent Fed actions constitute the single biggest liquidity injection in 50 years of data.

Ovviamente, il titolo di questo nostro Post è ironico: “non dire gatto finché non è nel sacco”, ripeteva un grande uomo di sport italiano. E al momento il sacco non si è ancora chiuso.

(Tutti i gatti ci corrono dentro, però.)

Tuttavia: c’è almeno un punto di vista, rispetto al quale noi di Recce’d abbiamo già vinto. le cose, sono andate proprio come noi avevamo previsto, per voi e per i Clienti, più di un anno fa.

Come successe già nel 2018, e lo ricorderete sicuramente, il mercato da mesi è partito all’inseguimento di un “miraggio”. I dati dell’ultima settimana, per l’Europa e per gli Stati Uniti, ce lo hanno confermato, e per i lettori che se li sono persi ecco qui due resoconti da Reuters. Non vi serve un economista, per comprendere il significato di dati come questi per i vostri portafogli e i vostri soldi.

U.S. January core retail sales unchanged; December revised down

Lucia Mutikani·          ·          

WASHINGTON (Reuters) - U.S. consumer spending appears to have slowed further in January, with sales at clothing stores declining by the most since 2009, which could raise concerns about the economy’s ability to continue expanding at a moderate pace.

The mixed retail sales report from the Commerce Department on Friday also showed purchases by households were not as strong as initially reported in December.

Retail sales excluding automobiles, gasoline, building materials and food services were unchanged last month. Data for December was revised down to show the so-called core retail sales rising 0.2% instead of jumping 0.5% as previously reported. Core retail sales correspond most closely with the consumer spending component of gross domestic product.

Consumer spending accounts for more than two-thirds of U.S. economic activity. Economists polled by Reuters had forecast core retail sales rising 0.3% last month. The unchanged reading in core retail sales suggested consumer spending lost further momentum early in the first quarter after losing considerable speed in the October to December quarter.

The economy grew 2.3% in 2019, slowing from 2.9% in 2018.

With business investment continuing to falter and manufacturing depressed, consumer spending had helped to keep the longest economic expansion on record, now in its 11th year, on track.

Despite signs of continued slowdown, consumer spending remains supported by a strong labor market, which is steadily lifting wages.

U.S. stocks index future pared gains after the data. The dollar was little changed and U.S. Treasury prices were steady.

In January, overall retail sales rose 0.3%, but data for December was revised down to show sales gaining 0.2% instead of climbing 0.3% as previously reported.

Sales were lifted by a auto purchases, which rebounded 0.2% after slumping 1.7% in December. Receipts at service stations fell 0.5%. Sales at electronics and appliance stores decreased 0.5%. Sales at building material stores jumped 2.1%, the most since last August, after rising 1.3% in December. Sales were likely boosted by unseasonably mild weather, which has boosted activity in the construction sector.

Receipts at clothing stores dropped 3.1% last month, the most since March 2009. Clothing retailers have been struggling with plummeting mall traffic as consumers opt for online shopping. Macy’s announced this month plans to close 125 of its least productive stores over the next three years and cut more than 2,000 corporate jobs.

Online and mail-order retail sales rose 0.3%. That followed a 0.1% dip in December. Receipts at furniture stores rose 0.6%. Sales at restaurants and bars increased 1.2%. Spending at hobby, musical instrument and book stores edged up 0.1%.

Europe on the brink of recession

• Reporting by Lucia Mutikani; Editing by Andrea Ricci

BRUSSELS (Reuters) - Euro zone economic growth slowed as expected in the last three months of 2019 as gross domestic product shrank in France and Italy against the previous quarter, but employment growth picked up more than expected, official estimates showed on Friday.

The European Union’s statistics office Eurostat said GDP in the 19 countries sharing the euro expanded 0.1% quarter-on-quarter in the October-December period, as announced on Jan 31, for a 0.9% year-on-year gain - a downward revision from the previously estimated 1.0% growth.

The quarterly growth rate slowed compared to the 0.3% expansion in the third quarter because of a 0.1% contraction in the second biggest economy France and a 0.3% contraction in the third biggest Italy.

Growth Germany, the biggest euro zone economy, stagnated.

Eurostat also said that euro zone employment rose 0.3% quarter-on-quarter in the last three months of 2019 for a 1.0% year-on-year gain. Economists polled by Reuters had expected a 0.1% quarterly rise and a 0.8% annual increase.

Separately, Eurostat said the euro zone’s trade surplus with the rest of the world was 23.1 billion euros in December, up from 16.3 billion a year earlier, bringing the total for the whole of 2019 to 225.7 billion, up from 194.6 billion in 2018.

Adjusted for seasonal factors, the trade surplus was 22.2 billion in December, up from 19.1 billion in November as exports rose 0.9% on the month and imports fell 0.7%.

Allora, nel gennaio 2018, il miraggio si chiamava “crescita globale sincronizzata”. Qualche cosa a cui la maggior parte di voi ai tempi credeva. Peccato che non è mai esistita. Mai, non ci siamo andati neppure vicino. Un miraggio, hanno detto poi a fine anno gli strategisti e i commentatori. Un abbaglio collettivo. Un abbaglio collettivo non casuale e manovrato

Oggi, la situazione è la medesima del gennaio 2018. La reflazione, la stabilizzazione, la ripresa: quante volte ve la hanno venduta, nel 2019, e quante volte avete dato fiducia a quei soggetti che ve la vendevano, come se fosse un divano venduto alla tv che ha un “valore commerciale di 500 euro” ma che voi potreste acquistare per 100 euro?

Nel pubblico dei risparmiatori sono in molti a cui piace andare avanti così. A molti piace essere imboniti: che poi vuol dire farsi portare a spasso da un imbonitore, un sorridente soggetto vestito in modo eccessivamente formale che vi vuole sempre, e comunque “tranquillizzare, anestetizzare, isolare dal Mondo”, il Mondo quello vero. A lui, voi pagate senza saperlo il 3,5% ogni anno, sia che le vostre cose vadano bene sia che invece vadano male.

Miracolati, questi imbonitori: il 2019 ha salvato a loro il lavoro, e la carriera. L’anno era iniziato con la Borsa di New York in un bear market (-20%) che avrebbe tranquillamente potuto continuare. Invece, alla fine del 2019 il medesimo indice aveva messo insieme il più ampio rialzo degli ultimi 10 anni.

E tutti voi lettori di Recce’d sapete benissimo che cosa c’è dietro al rialzo.

In particolare, da settembre in avanti, c’è questa favola della “stabilizzazione, reflazione, ripresa graduale”: che appunto non esiste.

Visto che non siamo più nell’età (dorata) dell’adolescenza, noi non crediamo più alle favole, e neppure ai supereroi invincibili: ma la massa, loro, si sono fatti convincere che gli errori invincibili esistono, che non spaglieranno mai, che si andrà avanti così per sempre, e che per sempre le Borse resteranno sui massimi.

(Anche perché, ovviamente, nel 2008 la Federal Reserve non esisteva ancora, no?).

A tutti questi investitori, che amano credere ai supereroi (perché rassicurano chi è insicuro di ciò che pensa) oggi Recce’d vuole ricordare che ogni film con i supereroi dopo due ore finisce, e quando si esce dal cinema, poi per strada non trovate Superman, ma al massimo l’automezzo che porta via la spazzatura.

Salvo che poi non lo si voglia vedere anche se non esiste, Superman.