TMM have been away last week skiing in the Italian Alps. Wow, what a surprise re prices! A coffee up the mountain is cheaper than in a provincial UK town. Yes, cheaper. The snow was great, the sun was shining, the resort was pretty, deserted and delightful, the locals were friendly and accomodating leaving us feeling that it's time to leave the French and Swiss mega-resorts to the Russians. Austria, however, will always have a place in our hearts due to its apres-ski madness. (By the way, US readers, which is the best US resort for apres-Ski? We have struggled to find any in the few resorts we have tried)
Returning to the markets, the last week hasn't really seen any game changing news, just the continued ingress of "better than expected" data dripping on to the fire of bearishness. It appears to be working in extinguishing some of the flames and we have returned to find some of our favorite permabears now wondering what new news they are missing to explain prices being higher. We'd like to suggest,- "What you were missing in the first place". Prices don't have to keep falling on old news. Change is what counts and the change is in the background data vs expectations.
In the immortal words of the Jackson Five -
If you look around
The whole world's coming together now
Can you feel it, can you feel it, can you feel it? (da dada da da)
Well maybe the whole world isn't coming together quite like that but the bears are finding it hard to extract value out of their well chewed bear food, unlike the bulls who, as ruminants, find it easier to extract value from regurgitated low quality good news.
Our problem is that we are find it pretty difficult to get excited by anything at the moment. Our long term views remain intact ( as per our slowly apperaing non-predictions for 2012) but short term influences still leave us pretty unexcited. So we are happy to play the upward drift of all things risk, hopefully accelerating thru old highs, until the next tape bomb. But to be honest immunity to tape bombs feels pretty high and it will have to be something pretty nuclear to knock things lower again.
So we hope the "risk on" grind will continue, even if it is doing more damage to some of our hedges than Edward Scissor-Hands on speed.
Knowing what to write apart from "s'goin up innit" is pretty hard, so we'll leave it at that.