Lioness Associates, Inc.

Economic & Corporate Risk/Yield Reports

August 12, 2012  -- Global Update for August - November 2012

Since the last update on May 9th, the elections in Greece resulted in the political parties unable to put together a government and as a result, the elections had to be held again in June. The initial stalemate in May caused ripples thru the rest of the global economy as the worst scenarios started to be played through and countries, as well as companies, re-examined their exposure and possible fall-out. Greece as expected, is having a difficult time holding to the austere measures that are required to get financial aid from the European community.  It is still unclear whether Greece will be able to stay with the Euro or as a last resort, print it's own money. Either way - it has a difficult road ahead for it's people and especially for the younger generation.

Note, the algorithms that produce the graphs have been modified slightly and in most cases have minimal impact on the trend lines but, in this case - there has been a notable change and that is the delta core down shift into risk in the May 2012 period. Thus, these version of the graphs are slightly different than the versions in the May 9th article.  

The Global 2012 Delta Core/Transient graph has three red boxes to highlight specific areas. The first box at the beginning of the year from January - March 15th period depicts the economy moving ahead as evidenced by the stock markets averages. The second box at the May - June period reflects the quick downward spin of the global markets possibly as a result of the elections in Greece.  The last box covering the month of December 2012, is a period when the delta core moves into risk — the peak for delta core hits in the previous month of November.  This could be indicative of some fractures in the economy starting to appear as early as November of 2012. The timing could coincide with the fiscal cliff in the USA affecting the global community but, since this is a global chart it could well be another hot spot in the world.

The Global 2012 Risk/Yield graph also has a red box, this one around the period of July to August 2012. While the market averages worldwide have increased from June thru August 2012, the information portrayed here might suggest that the momentum peaks in August and drifts downward until September when core moves into the yield area of the graph.