Unfortunately something also went bump for Mr. Bradley Wiggins overnight. Wiggo was hit by a car while riding his bike near his family home in Lancashire. It seems that he's broken some ribs as a result of a car driving out of a service station. I know exactly what's happened, I've swerved so many times on narrow European roads in this very situation. I bet it's ugly when you do it going at TdF speed.
There was a big bump on the stock market as well. I said in this blog that an Obama victory was bad for equities and I also said a Romney victory was bad for bonds. Well what I didn't say was the real problem was the intersection of an Obama victory with a continued legislative block in Congress. It's all ugly and the big bump in my night was the realization that the fiscal cliff is looking a lot more dangerous. The S&P dropped 2.4%.
|Look out below . . .|
It's interesting to watch Apple, which is now at a five month low as the market starts to get the post Steve Jobs jitters thanks to the mapping app on iPhone5. The problem is that Apple was, and probably still is the biggest best bet amongst Hedge Funds who trade in the US market. The stock has been the a bright beacon of hope on the stormy seas in the post GFC world. What I think we're seeing is a revaluation of the stock to a lower multiple as the Steve factor disappears in the rear view mirror.
Europe is the home of the "bump" and even though the Greeks passed the latest round of austerity legislation yesterday the Spanish looked more likely to need a bailout. The anti austerity groups grow ever louder in Europe. The lack of flexibility on the currency front leaves the masses very little room to move. If the FT is right and the Spanish completely blow-out the 4.5% deficit target and veer closer to 6% then Draghi will need to buy a hell of a lot of bonds in the coming months. Expect more revisions to European growth and bump the Euro from your investment portfolio.
A final bump was the sound of German Industrial Production hitting a wall. No doubt the engineering genius of the German's made the bump sound a lot better than it really was, but a 1.8% fall month on month was worse than expected and follows Tuesday's data that showed factory orders fell 3.3 per cent in September.
Maybe the Chinese can help?