12 December 2016: Parity

euro-dollar-scalesIt’s been a while since one US dollar had the same value as one Euro. But it is very likely that we will see parity at some moment during 2017. Draghi’s announcement last week that the ECB will keep buying government and corporate bonds, will keep interest rates low in the Euro zone. And it is very likely that Janet Yellen will announce a (small) rate hike in the US this week. Donald Trump’s Presidential policies will most probably increase inflation next year and, as a result, further rate hikes will follow. It is unclear what the effect on the world economy will be. Maybe it will be a stimulus to the European economy, now that the Euro is getting cheaper and cheaper. But on the other hand: it might be bad to stock prices in the US. Once stock prices start slipping, it may have a negative effect on the sentiment of not only investors but also that of business owners and, in the end, citizens. The history of the past 40 years has shown us that a period of a strengthening US dollar is usually followed by an economic downturn. Will we get the long awaited breakdown of stock markets in 2018?

white-chapel-logo-smallLast Friday, stock prices kept climbing, as if there was no tomorrow. All major US indices gained at least 0.5%. With the first global oil pact since 2001 being settled over the weekend, there might be a chance that we see a further extension of the rally at the beginning of the week. Our newly acquired UVXY ETFs made a loss (-1.8%) and return for the year dropped to 321%.
White Chapel did not give a signal after Friday’s session. It thinks that an upcoming change of momentum is more likely than a further rise of stock prices after the extensive Trump rally we experienced the last couple of weeks. So, White Chapel advises us to stick with our UVXY ETFs.

Accumulated capital at close of previous trading day

Return since start

Return this year

Return this quarter

$42,108

+321.08%

+321.08%

+37.5%

Our initial capital was $10,000 at 1 January 2016. Our average Annual Return is 370%.

ta_v05-small-invFor one of his walks, Tim decided to go west. He ended up in an area which used to be a swimming pool in open air.  In 2005, it was decided that the municipality would no longer invest in the swimming pool and it was dismantled as a result. Nowadays, the area is in the process of being transformed into a nature reserve. Slowly, but surely, nature managers are turning swimming pools and sunbathing lawns into an unbroken landscape with woods, heather, fens and sand-drifts. Although there is a lot of work to be done, some parts of the area already look like a nature reserve at its best. The picture below shows a scenery that could be used to record the Dutch remake of Once Upon a Time in the West, a so-called cheese-clogs-&-mills western.

wild-west-dorst