Don't Cheat the Wealthy In Germany

From Art Market Monitor:

Art Advisor Aschenbach Receives 6-Year Sentence

Overcharging your clients is a serious crime in Germany:

62-year-old Helge Achenbach was sentenced to six years in prison after judges of the court in Essen on Monday found him guilty of cheating his wealthy customers.

Achenbach was considered the networking wizard and powerbroker of the German art scene until his arrest on June 10, 2014 when he was returning from Brazil after decorating the living quarters of the German football team with his choice of artworks. He has been in police detention since then....MORE

Which, for some reason, reminded me of this story from See It Market:

German DAX Powers Over 12000: Is European QE Working For All?

The scare in the global equities markets last October marked a pivot point for European equities in particular. Following the low in the German DAX of 8354 in mid-October, the financial markets decided to get serious. The ailing Euro Zone economy was becoming alarming and investors could finally sense a more serious effort to stimulate.

Whether that stimulus (now known as European QE) is effective economically remains to be seen (my guess is not so much). And it’s been politically toxic. But that’s neither here nor there for active investors (at least over the short-term). It has been, however, quite effective in devaluing the Euro and driving capital into European equity markets such as the German DAX. In short, low-to-negative interest rates plus cheap paper equals little to no choices.

Earlier this morning I tweeted out a couple statistics on the German DAX. Since the October lows, the DAX is up 45 percent. And although it’s RSI is at 80 and overbought, the “march” higher has been orderly. Below are charts of the German DAX vs the S&P 500 (SPX), as well as the DAX to SPX ratio (to show relative strength performance).

As you can see, the DAX has outperformed the S&P 500 by a wide margin since October. Money has consistently rotated into EU equities, but particularly Germany. The French CAC40 and FTSE MIB (Milan – Italy) are up just over 30 percent and the Spanish IBEX is up about 18 percent. And the Greek market is still making new lows. This performance picture makes it difficult to assess if European QE is working (or will work) for all.

As well, if we look at the German DAX in terms of the US Dollar, we can see that the move has been of greater import to EU investors (hinting that it is likely internal flows)....MORE

Perhaps we should fix the SIM headline to read:

 "...Is European QE Working For All Who Matter?"