Michael Belkin’s Trade of the Year
Belkin first talked about a time series algorithm which he developed when he was at Salomon Brothers. His algorithm indicates 2014 is a year in which investors should shift to “risk off.” Belkin favors bonds over equities.
Belkin said investors were sold the “China growth story” to support the thesis of investing in emerging markets, which isn’t true anymore. He added there would be an unwinding and deleveraging in emerging markets investments.
Belkin mentioned weakness in Thailand and the Phillipines, which normally trade down towards the 200 month moving average, indicating a decline of 40-50% from current levels.
In the video Belkin further elaborates on the debt problems facing China.
The CNBC site indicates Belkin is in favor of shorting emerging markets and going long gold stocks.
Back in October 2012, the dapper Belkin predicted a recession and a stock market drop of 40% [link].