Optimists trapped: If you bet on rising prices at the wrong moment on the stock exchange, you will suffer losses
Photo: Frank Rumpenhorst / picture alliance / dpa
Hamburg - Crisis?
What crisis?
That's what you might think when you look at the stock market's price development over the past few weeks.
The Dax collapsed sharply from the end of July to the beginning of September.
Since then, however, it has increased again by around 20 percent, so that the jump over the 6000 point mark is now being tested again.
So have investors checked off the euro debt crisis?
Have you forgotten your worries about the economy in many European countries and in the USA?
It seems as if the bulls, ie the optimists, have the upper hand again in the stock market.
But beware, experienced stockbrokers know the bull trap: A confident investor enters the market because he assumes that prices will rise - and is then suddenly surprised by the opposite.
There is some evidence that this is precisely the danger that currently exists in the stock market.
Because what are the reasons for the current price increases?
On the one hand, there is the economic outlook, which no longer seems quite as gloomy as it did weeks ago.
Germany, for example, seems to have gotten off lightly, and another recession is apparently not imminent in this country.
Most recently, the leading research institutes came to this prediction in their autumn report on Thursday.
Hardly any reasons for a real stock market upswing
On the other hand, the latest developments in the euro debt crisis have apparently eased investors' concerns a little.
Apparently, the top EU politicians now also recognize that there is no way around a debt haircut for Greece.
In addition, Europe's banks are to be provided with more equity so that they can better cope with such a bad debt.
"There are two main reasons for the current price rally," says Wolfgang Leoni, Chief Investment Officer and member of the Sal. Oppenheim Management Board.
"On the one hand, the economic data have stabilized, especially in the USA. On the other hand, there is the phantasy that the Chancellor and the French President will announce measures in their announced program to solve the debt crisis that go far beyond the solutions that have been implemented so far."
Finally, according to experts, technical reasons play an important role: many investors have positioned themselves for further falling prices in the past few weeks and have been caught on the wrong foot by price increases.
In response, they had to stock up on paper, which also drove prices up (the so-called short squeeze).
The question now is: are these reasons enough to justify a continued stock market rally?
The answer is not difficult: obviously not.
Why are prices likely to fall again?
Take the economy as an example: although Germany is being spared the recession, the rest of Europe is probably already in the thick of it.
In addition, the USA is far from off the hook, which is mainly due to the horrendous national debt there.
"The US debt crisis and the British debt crisis are even less resolved than the euro debt crisis," says Martin Siegel, Managing Director of Stabilitas Fonds GmbH.
"The dollar-based international fiat credit indebtedness system is headed for ultimate collapse."
And even in the emerging countries, which are regarded as a key driver of the global upswing, there is a threat of economic setbacks.
Just this week, Xiaogang Zhang, head of the Chinese smelter operator Anshan and President of the World Steel Association, opened the world conference of the economically sensitive steel industry in Paris with extremely reserved words.
Above all, Zhang expressed concern about high inflation in China, which has already restricted lending there.
Important investments are already being delayed as a result, the manager reported.
What is perhaps even more serious: on the old continent, the development of the euro debt crisis may be greatly overestimated by investors.
If the hoped-for solution does not come about, it would probably also be fatal for the real economy.
Because if the banking sector suffers too many defaults on southern European government bonds, sooner or later it is likely to throttle the flow of money to companies.
In any case, that doesn't seem unreasonable.
"I assume that the markets are currently simply overestimating the firepower of the Merkel-Sarkozy package," says Oppenheim board member Leoni.
"So there's a lot of potential for disappointment."
High debt, low growth
The pessimism is shared by many.
One point of view that can often be heard on the capital market is that the debate about a debt haircut for Greece and a recapitalization of the banks may be pointing in the right direction.
However, these are still only considerations and announcements - action is still a long way off.
And even if the plans should become reality;
it is questionable whether this would solve the actual problems in the euro zone.
Criticism of the bank plans comes, for example, from the camp of the institutes themselves. Deutsche Bank boss Josef Ackermann, for example, doubted at a conference in his house on Thursday that the necessary funds could be raised on the capital market.
The plan therefore bypasses the current problems.
In the end, taxpayers would have to pay for a compulsory increase in the capital ratio, which would further drive up the debt of European countries, according to Ackermann.
"European banks urgently need fresh capital and we are moving towards a solution," Stefan Isaacs and Mike Riddell, two fund managers at British bond specialist M&G, told journalists this week.
However, the two do not consider this to be a panacea either.
On the contrary: The experts believe that Western Europe will struggle with reducing national budgets for years to come.
As a result, low economic growth and ever shorter and more volatile economic cycles can be expected.
How investors can react to the risk
Daniel Hartmann, analyst at bond manager Bantleon, is similarly pessimistic about the future: "Overall, the degree of restriction in euro fiscal policy will not decrease over the next year, but will continue to increase," he says.
"This gives an additional impetus to the downward spiral that is already underway."
Hartmann explicitly warns of the real economic consequences of "renewed financial market stress".
According to him, data from the summer already show that the banks are again more cautious about housing and corporate loans.
Even the haircut for Greece, which many experts have been calling for for a long time, would probably not necessarily improve the situation.
"In the long run, there are more problems than solutions," writes Martin Huefner, chief economist at Assenagon Asset Management, in a recent comment.
Some of his reasons: Greece would then very quickly get into trouble again, because the Athens budget shows a deficit even without debt service - and it is questionable who should make this money available in the future.
In addition, according to Hüfner, the fundamental error of the euro is that although the monetary and exchange rate policies of the participating countries have been merged, their fiscal and economic policies have not.
"That doesn't fit," writes the economist.
"The asymmetry will not be solved by a bankruptcy of Greece."
Just checkout
Reasons enough for a speedy return of pessimism to the stock market.
In any case, expert Hüfner advises investors to exercise caution.
"Equities will remain volatile," he writes.
"With a more downward trend."
And he's not alone in his assessment.
Burkhard Wagner, for example, CEO of Munich Partners Vermögensmanagement AG, believes that the Dax will continue to move between 5,000 and 6,000 points in the near future.
Uwe Zimmer, CEO of the asset manager Meridio in Cologne, expects a "trading market" with strong fluctuations at least in the next three to four weeks.
And Lothar Koch, portfolio manager at GSAM AG in Düsseldorf, is certain that a sharper price decline is imminent this year, which could even drop the Dax below the 5000 point mark.
After all, according to the experts, investors have various options for preparing for this.
On the one hand, they can set stop-loss marks in their depots to limit losses.
On the other hand, there is the option of hedging individual positions with warrants.
In addition, there are the classic methods of risk control: A healthy spread of funds across different asset classes and regions.
And particularly advisable in the current situation: cash in, i.e. withdraw from the market for a while and wait and see what happens.