Greek double somersault and pike, with a twist.
Markets recovered over the past week based on one of the more spectacular backflips in political history. One wonders what the Greek referendum was all about, given the man who having called it, recomended a NO vote, and then got his wish, seemed to ignore the result. Irrespective of whether one belives the Greeks should, or should not accept the medicine their northern neighbours, particularly the Germans were prescribing' hardly matters. No wonder that the 60% of the Greek population that voted no are less than happy, or even decidely grumpy.
What seems odd to fathom is how anyone thinks the so called solution will cure the underlying problems? Adding more new debt to cover that already in place, as any consumer with a bunch of maxed out credit cards in their wallet would, or should know, would seem to be simply kicking the can a further three years down the road. So look out for Grumpy Greeks for at least the next three years, and Grumpy Germans when it all returns to bite them in three years' time.
And so to China, which along with Greece seems to have been the major topic of Hedge Clippings for the past few weeks, as it has been for the mainstream financial press. Chinese quarterly GDP figures, once again delivered so swiftly that one has to assume they're fudged, came in at 7%, bang on target. What a wonderful co-incidence! Given Singapore's quarterly GDP declined sharply by 4% yoy, and a massive 14% annualised, in no small part as a result of reduced manufacturing and exports to China, it makes the Chinese GDP result even more questionable.
What makes the data so rubbery is that power comsumption in China grew by just 0.8% over the quarter yoy, well below expectations and one of the lowest rates of quarterly growth in the past 20 years. Crude steel and pig iron production fell 1.7% over the quarter, the first decline since records began in 1994, cement was down 20.5% yoy, and glass by 6.6%, while rail volumes declined by 9%. Even though the reported GDP growth was 7% for the quarter, this was still the lowest in six years, assuming you take them as gospel.
People in some quarters have been unkind enough to call me a cynic (amongst other things) but I can't imagine why.
Specific results received this week include the following PERFORMANCE UPDATES:
The Paragon Fund returned -3.80% versus the ASX 200 Total Return Index's -5.30%, for the month of June 2015. The Fund's annual return since inception has been 18.82% p.a. versus the Index's 7.46% p.a.
Morphic Global Opportunities Fund outperformed it's benchmark MSCI AC World Total Return in Australian Dollars by 0.31%.
FUND REVIEWS released this week: Monash Absolute Investment Fund; Optimal Australia Absolute Trust
20 - 21 August 2015 -The 2nd Superannuation Fund Investment Operations Forum 2015 is a two day forum providing invaluable technological, regulatory compliant and best practice insights into improving back and middle office efficiency to drive member loyalty, bottom line profitability and a competitive edge
26 - 28 August 2015 -The 15th Annual Wraps, Platforms & Masterfunds Conference will provide solutions for succeeding in a distribution world of endless possibilities, showcasing strategies to help business achieve the biggest bite of market share, use innovation to overcome problems and support opportunities. Australian Fund Monitors is pleased to offer a discount of $300to all investors and advisors using coupon codepromoFMon registration.
15 September 2015 -The AIMA Australia Hedge Fund Forum 2015 is the annual non-profit hedge fund conference organised by the industry for the industry.
It's a while since "Now For Something Completely Different" featured one of our four legged friends, so this might bring a smile to your face.
And finally, best wishes for a happy and healthy week-end ahead,
Regards,
Chris
CEO, AUSTRALIAN FUND MONITORS
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Australian Fund Monitors are helping to raise awareness to support research into prevention and cure for cerebral palsy. For more information visit www.cpresearch.org.au or contact me by email.
