27 October 2016: Europe is a powder keg

kruitvatThese days, Europe is a powder keg filled with political unrest. Although the economic growth results have not been disappointing for 2016 so far, many analysts have great fears for 2017. Populism will be an important factor in elections and referenda that will be held in Italy, France, the Netherlands and Austria. There might be a real chance that the European Union disintegrates. If we add the weak position of a number of European banks to that, we can be sure that 2017 will be a turbulent year for Europe. And with that, probably also for the rest of the world. Investors should take into account that next year will be characterized by increased volatility. And if the lid doesn’t stay on the powder keg, markets might even explode, as we saw during the Greek government-debt crisis in 2009 and 2010.

white-chapel-logo-smallBoth the S&P 500 and the NASDAQ had a hard day yesterday, because of disappointing corporate quarterly results. The Dow ended up, because of positive results from Boeing which exercised their weight on the index. Volatility was on the rise, because of the mixed outlooks. The VIX gained more than 6% and our UVXY ETFs added more than 5%. Return for the year rose to 222%. Return for the quarter became darker green and now stands at more than 5%.
White Chapel is expecting even more volatility, so we stick with our UVXY ETFs.

Accumulated capital at close of previous trading day

Return since start

Return this year

Return this quarter

$32,216

+222.16%

+222.16%

+5.2%

Our initial capital was $10,000 at 1 January 2016. Our average Annual Return is 323%.

ta_v05-small-invThe Netherlands is a very flat country. The highest ‘mountain’, the Vaalserberg, is only 323 meters high. Major parts of the Netherlands are even below sea level. But under the right circumstances, in the right place, you might get the impression that the Netherlands is a mountainous country. The picture below was taken at a large fen in the South of the Netherlands, the Galgeven. The surroundings of this fen are completely flat, but through the mist, the majestic trees that enclose the fen look like the hilly offshoots of mountains. The picture reminds Tim of the cover art of If Mountains Could Sing, a CD by Terje Rypdal that was released in 1995 on ECM Records.

mistymountains