April 2010 COP Report                                        5/12/2010

Investment Gang

I am sure you remember that I have been very cautious about the value of this trend data over the past few months.  There is what I think is some good news this month.  The data in this report all comes before the 1^st of May.  That means that it does not reflect the market meltdown we had the first week of May and of course not the recovery we are having this week.  I think that may be good because the market seems to be giving the Europeans credit for a good solution to their problems even though they may only be buying a few years time.  That puts us back about where we were in most of April and the prior several months but with one major problem put firmly on the back burner for a while.  How many oil well and volcano blow ups can we have?

Note also that the top 10 or so are remarkably similar to last month.  The Research Model also shows ten out of 15 repeats from last month.  There are a few interesting exceptions – emerging markets and Pacific-Asia for example are lower in the rankings.  This reflects the concerns about risk assets that were developing in April with the concerns about European national debts and the prospect for a second recession in Europe.  These have of course rebounded this week along with the European assets.  One fund manager has said that emerging markets are just “a leveraged play on the major developed economies.”  This has certainly been the pattern in the past several weeks.

Best, Mal