As anticipated by LEAP/E2020 (1), hedge funds, such as Global Alpha Fund for instance, the most important hedge fund administered by Goldman Sachs, are beginning to feel the consequences of their anticipation mistakes in 2006. The fall of the dollar and that of the US real-estate in particular severely cut down their profit margins (an almost 12% drop for Global Alpha Funds since the beginning of the year.

In the coming weeks, during which the entry into recession of the US economy should be confirmed while the dollar will continue to fall, many more similar funds will follow the road to bankruptcy, like Amaranth two months ago. This negative trend is beginning to affect the whole of the US financial sector and in the coming weeks it will impact severely the last growing component of US employment. Indeed, the mediocre employment figures published last Friday are in fact only reached thanks to jobs creations in the financial sector (43,000 jobs on a total of 132,000).

Find more of these LEAP/E2020’s analyses and recommendations in GEAB N°8, N°9 and N°10 to be released next December 15th (on subscription.

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Notes:
(1) Abstract GEAB N°8 (October 16, 2006) : “By developing the “risk” industry without any limits, the “hedge funds” became the de facto producers of the only other profitable American export together with the Dollar: risk. The considerable profits generated by this activity gradually led all main investment Wall Street banks in this direction. Today they have all primarily become gigantic “hedge funds”, just like Goldman Sachs, and just like the majority of the “primary dealers” approved by the American authorities.
These financial institutions are now guarantors of the perenniality of the American public signature, as well as operators strongly involved in the American financial markets good health, and the main world speculators on financial risks. LEAP/E2020 believes this positions them in the heart of the storm to come because they stand at the cross point of all power forces currently crushing the global system to pieces.”

Lundi 11 Décembre 2006

LEAP / E2020

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GEAB N°65 - Contents

- Published on May 16, 2012 -

Global systemic crisis / Second half of 2012 – Convergence of four explosive factors: Banks-Stock Exchanges-Pensions-Debts
Whilst waiting for Euroland to equip itself, by the end of 2012, with a medium to long term common political, economic and social project, especially following the election of the new French president François Hollande, anticipated many months ago by LEAP/E2020, players will remain prisoners of the short-term reflexes related to the sudden Greek political tremors, the uncertainties over Euroland governance and to the risks in public debts… (page 2)
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Which languages must your child learn to be useful to him in twenty years ? Anticipation of the principal intra-European and world common languages in a 2030 timframe
Beyond its cultural interest LEAP/E2020 has created this anticipation as a tool to aid decision-making, individual (parents for the education of their children) as much as collective (public education institutions, universities, states, international businesses). Individual and joint strategies as regards language teaching are long term processes needing fundamental choices to be made almost a generation in advance… (page 11)
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Strategic and operational recommendations
. Currencies-Gold: Stay on course
. Pensions: Preserving one’s capital
. Stock Exchanges: Last exit before chaos
. Banks: Maximum distrust
. Government bonds: The trap is closing (page 21)
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The GlobalEurometre - Results & Analysis
The majority of respondents believing that their country’s major banks could go bankrupt by the end of 2012 has risen to 66% this month (versus 61% last month)… (page 23)
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