1. The US treasury. As I wrote BubbleWatch, the JP Morgan US government bond index had just notched an astonishing 14.3% annual return. A heroic response to the (momentary) implosion of international capitalism. The previous year's return was 9.2%, and the preceding years averaged in the neighbourhood of 3%. Sadly, my warning that
"Americans will learn the meaning of the Afrikaans post New Year phenomenon bubble-las,"was lost in translation (or perhaps the fact that not even my mother reads this blog.) As warned the bubbled popped with the JP Morgan index registering -3.8% - the first negative year in a decade, and the largest drawdown in the (short-assed) life of the index.
2. Barak Obama When we wrote a year ago, his Gallup rating cruised at 68%. I deferred specifics to the Inauguration Welcome, when I wrote that
"Ratings are driven by public ennui, and his biggest worry is that the American public will tire of their gut-curdling ride on the credit-coaster. 50-something approval points signals a bursting of the Obama-bubble, and a retreat to normalcy."As I write, Obama has the second-lowest end-of-first-year rating at 49%. The only worse performer was Ronald Regan, who scraped to safety when an assassin's bullet punctured his lungs. I warned at the time that V-shapes don't occur in the Gallup curves (American voters don't fall back in love with their exes.) So unless something 911-esq happens, these are the doldrums for Barry O.
3. China. They're holding onto (and topping up) their T-bills for now, but all the noise about securitising drawing rights paints a picture. Growth has been positive, but well below the required 8% minimum. The country's been doing well politically, but it was an investment, not a strategic bubble. And this is looking terminal. I'm open to debate on this one, but my sincere reading is that we're over the euphoria stage.
When I feel a little less lazy, I may just write my ten for '10.
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