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Thursday, December 12, 2013

Guess Who's Buying Equities

http://viableopposition.blogspot.ca/2013/12/guess-whos-buying-equities.html

I was a frequent trader, particularly prior to and during the Great Crisis; my investment strategy in recent years has tended toward buying when others are selling I looked at the 2008 crisis as a buying opportunity, particularly for good quality preferred shares.  Right now, I don't like the market; it is frothy and, in my opinion, is not based on any fundamentals that I understand.  That said, apparently many investors would disagree with me and, in a hunt for return in this prolonged near-zero interest rate environment, desperation for yield reigns supreme.

What is most surprising is that one group of investors is increasingly turning to equities to boost the portfolios that they manage; central bank reserve managers.

Let's start by looking at what has happened to the trend in global central bank reserves since 1980:

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