Firstly, this article is just an  another reminder that when you make your investment choices – you have to diversify. Numerous retirees in Argentina, Germany and Italy lost their investments in Argentina’s default in 2001. Most of them lived very comfortably for a while but the default had wiped out everything.

The second important point is the danger and uncertainty of investment in countries like Argentina. The economy in Argentina moves rather erratically going from boom to bust and article gives the clear picture on how hard it is to deal with the mess after the bust. Here is the problem in a nutshell:

“Argentina is the world’s leading exemplar of how a sovereign should not treat its creditors,” Brodsky said in an emailed statement last year. “The global financial system is placed at risk by rewarding such behavior, not by enforcing contracts.”

http://www.newsweek.com/retirees-set-lose-big-argentinas-bond-fight-255553

http://www.newsweek.com/argentina-keeps-hedge-funds-sweat-after-supreme-court-ruling-255268

Rada

While in everyday life stability and predictability are in high demand , quite the opposite is true in a  world of energy trading. At the times of relative stability  energy traders are bored because moneymaking opportunities are scarce.

Polar Vortex definitely cheered them up with unusually large price swings in natural gas.

“We did have a particular strength in commodities given the volatility in the market with the weather,” CFO Ruth Porat told The Wall Street Journal. “Commodities tend to perform better in extreme weather.”

Now is even better. Current situation of confrontation between Russia, Ukraine and EU, which might impact lives of millions of people in Europe creating perfect opportunity for the energy traders to rip big benefits. Prices of natural gas went up significantly on a concern that Russia will cut the gas supply. Due to the recent events in Iraq oil market again became very volatile with prices hitting $115 for the barrel of oil to the sheer joy of energy traders. So when we consider crises in Iraq or Ukraine as destabilizing factors, traders love the opportunity that these instability factors present because that where real game starts.

http://www.forbes.com/sites/chipregister1/2014/06/19/what-do-iraq-the-ukraine-and-the-polar-vortex-have-in-common/

Rada