Leo Haviland provides clients with original, provocative, cutting-edge fundamental supply/demand and technical research on major financial marketplaces and trends. He also offers independent consulting and risk management advice.

Haviland’s expertise is macro. He focuses on the intertwining of equity, debt, currency, and commodity arenas, including the political players, regulatory approaches, social factors, and rhetoric that affect them. In a changing and dynamic global economy, Haviland’s mission remains constant – to give timely, value-added marketplace insights and foresights.

Leo Haviland has three decades of experience in the Wall Street trading environment. He has worked for Goldman Sachs, Sempra Energy Trading, and other institutions. In his research and sales career in stock, interest rate, foreign exchange, and commodity battlefields, he has dealt with numerous and diverse financial institutions and individuals. Haviland is a graduate of the University of Chicago (Phi Beta Kappa) and the Cornell Law School.


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The world’s long-running economic crisis of course has not limited itself to either one nation or one region. However, at its outset in 2007, most did not anticipate the scope or length of the disaster. Weren’t potential risks to the international economy rather modest? Weren’t issues related to the United States real estate marketplace mostly relevant only to that domain and that nation, and likely to be restricted to them? Yet substantial debt and leverage (and other intertwined issues) and their consequences were not confined either to American territory or the real estate playground.

The recent Eurozone chapters of this terrible trouble supposedly started with so-called peripheral nations such as Greece, Portugal, and Ireland. Countries such as Greece indeed first captured headlines. However, that does not demonstrate that causes of Eurozone problems necessarily started only in them. In any event, “difficulties on the periphery” engulfed the rest of Europe and traveled around the globe.

Despite broad concerns regarding worldwide economic problems and risks, despite the widespread past and current fascination with the European scene, suppose one focuses on aspects of the American stage, beginning with some highlights involving the United States alongside Canada and Mexico in the foreign exchange context. This survey of America and its geographic neighbors underlines the weakness of the United States dollar and the size of America’s fiscal troubles. This suggests the merit of inquiring into US currency, stock, interest rate, and commodity marketplace past and future relationships in the context of Federal Reserve easing policies and America’s fiscal problems.

The broad real trade-weighted dollar probably will continue to weaken. The dangerous United States fiscal situation probably will not be genuinely fixed in the next several months. A full- fledged threat of a federal fiscal catastrophe likely will be necessary for sufficient progress in that sphere to occur. Though the United States is not the center of the universe, the effects of further dollar feebleness and the worsening of the country’s fiscal crisis will radiate worldwide.

The S+P 500 has made or soon will make a significant peak.

Thus the emerging (current) story and trend appears to be: weaker dollar (TWD), weaker S+P 500, and higher government rates (UST 10 year benchmark). This vision admittedly is dramatically different from the current popular faith in these marketplace relationships.

FOLLOW THE LINK BELOW to download this market essay as a PDF file.
American Marketplaces- At the Crossroads (10-15-12)
Charts- US Dollar v Canadian Dollar, Mexican Peso (10-15-12)


In diverse ways, many financial marketplace pilgrims monitor the equity realm and the commodities universe “together”. In recent years, significant price trends in commodities “in general” (use the broad Goldman Sachs Commodity Index as a signpost) roughly have paralleled those of the S+P 500. Noteworthy bull voyages in the GSCI have commenced at “around” the same time as those in the S+P 500. The same perspective appears for bear trips. Intersections between equity benchmarks and commodities contribute to the ongoing worldwide economic crisis story.

Some narrower stock sector indices such as the XOI, OSX, CRX, XNG, and XLE stand at a crossroads between commodities related to them and to wider equity indicators like the S+P 500. Thus many narrow equity domains intersect with (have links to) the so-called overall United States (and global) economy as well as to the important commodities related to that given sector. Thus an equity index composed of corporations involved in the petroleum industry reflects to some extent price levels and trends in “underlying” (related) oil prices. Thus some narrow United States stock sector indices at times can offer useful perspectives on (confirm, reflect) past, current, and future paths for wider stock indices such as the S+P 500 and the broad GSCI.

Scan the attached chart analysis. The broad GSCI chart displays price and time links between commodities and the S+P 500 from mid-2008 (and the acceleration of the worldwide economic disaster) through the recovery and up to the present. See several important equity sector indices, the XOI, OSX, XNG, and CRX, in this context. These four narrow equity indicators contain different members. Their price and time routes are not exact duplicates. Yet significantly, especially when interpreted together, the patterns of the XOI and its friends resemble that of the S+P 500 and the broad GSCI.

This viewpoint does more than underline that the international economic crisis that walked onstage in 2007 remains far from solved. Take a look at the price level from the start of May 2012 to now in these stock and commodity charts alongside their prices during mid to late summer 2008. The 5/1/12 and thereafter levels are around ranges from which prices collapsed as the economic disaster worsened in late 2008. The world of course is not exactly the same now as then. Many observers contend that central bankers, finance ministers, and politicians have gained experience as the global economic crisis has unfolded.

Nevertheless, though stock and commodity marketplaces in 2012 or thereafter may not repeat the accelerated descent of late 2008, that period of four years ago should not be forgotten. Keep the attached chart of the S+P 500 from the sunset of the blissful Goldilocks Era in 2007 to the marketplace bottom on 3/6/09 at 667 in mind.

FOLLOW THE LINK BELOW to download this market essay as a PDF file.
Stock and Commodity Crossroads (6-12-12)
Stock and Commodity Crossroads- Charts (6-12-12)