The bell tolls NEW
The China-US cold war is upon us. It is unfolding as expected, but the pace is now accelerating. It means…
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The bore NEW
In January, during Chinese New Year, I had started writing about Covid-19 — warning clients of its potential to destroy.…
The measures being introduced by the US to control the export of technology to China have four qualities. They can…
We have set out our store a long time ago as regards the post Covid-19 macro setting and asset allocation:…
Even in times of great uncertainty, obvious things still happen. Shuttering much of the global economy crushed demand. That was…
It is striking how little is known, but how widespread is the conviction, that once the pandemic wanes things will…
The rates of Covid-19 new daily infections are starting to roll over. Over Easter globally there were around 70k new…
War horse (30 March 2020) sketched the architecture of a war economy versus a pandemic economy. This note goes further.…
Even before the Covid-19 crisis, about one quarter of US quoted corporations were cash flow negative. This is because they…
Fighting them on the beaches is different when the invisible enemy is little purple and red Covid blobs with spiky…
If all country pandemics were the same then we’d have a good understanding as to how this current global crisis…
The economic shock from Covid-19 is being underestimated. This is natural when the immediate priority is safeguarding human life. This…
Having weighed all the evidence, our advice to clients is not to second-guess the pandemic until there is much clearer…
We are shifting currency investments because of the collapse in the oil price which, coming on top of Covid-19, is…
Markets are likely to remain volatile as the lag between actual COVID-19 infections and the reporting of cases continues to…
We have cut our long US dollar position versus the euro, taking us neutral. We expect oversold equity markets to…
Environmentalism and sustainability are unstoppable forces. But some investors remain slow to embrace the change. Thus far most effort has…
The likely economic and financial market damage caused by the Coronavirus (2019-nCoV) is underestimated. We remain short Thai baht and…
Trump’s ‘Phase 1’ trade deal isn’t the concrete base to build the 2020s on. It’s a short-term deal that fits…
Markets remain convinced that macro risks are not worth worrying about. Nor market risk, such as the growing exposure of…
Don’t look now, but actually Taiwan is doing very well out the US-China trade war. Despite that, all is not…
The removal of uncertainties is always good for a short-term market boost. But it’s often better to travel than arrive.…
Fixed income portfolios have enjoyed a bumper year in 2019. Yields are at rock bottom. That makes achieving even moderate…
This report discusses what strategy would look like if the US dollar were suddenly to lose its safe-haven status. This…
The trade negotiations in Washington are unlikely to shift the needle of global confidence or impending recession significantly. The Washington…
If debt were productive it would produce more than itself. This is what is needed to pay for it in…
Nothing in recent events has mellowed our views on the risks facing the global economy. The China/US trade conflict is…
There have been a number of recent developments that impact our asset allocation. First, we are adding more euro shorts…
The state also was the key player in all the Asian emerging markets that graduated from middle-income to rich economy…
The world is closer to a recession than markets anticipate. This report sets out the many interlinked causal factors that…
The current boom in investment spending among the tech giants is now close to the entire Federal budget for education,…
The most dangerous fights are the ones where both contenders have total confidence they will win. The US-China trade spat…
Expectations for easier US monetary policy are taking the wind from the dollar’s sails. These market changes reflect the worsening…
The populists might get 30% of the vote in the European Parliamentary elections, but that will translate into just above…
The reality is that the US woke up too late to the risk of China usurping them as the key…
By a narrow probability, it is likely that the US-China trade talks can be saved. But only just. The complacency…
We think there will be several effects from a US-China trade deal. These span import substitution, from a probable increase in US sales to China, including technology imports which will actually make it easier for China to meet its “Made in China” goals.
Based on how far the US term premium has fallen, to see any further meaningful decline in bond yields we’d need another downside macro shock.
The slowdown in global growth has been accompanied by an inversion of the US yield curve — the one recession indicator that always enlivens markets. While statistically the curve is an excellent forecaster of downturns, there is much to suggest things might be a little different this time.
More than 12 years after the start of the global financial crisis (GFC) central banks do not feel able to…
Global activity is on the back foot. World trade has been weakening for months and the economic soft patch has turned into a more prolonged slowdown, certainly in Europe and Asia.
There is an assumption that demography is a slow-burn theme that can be filed away for the long term. But working age populations are already shrinking in many of the major economies.
Despite positive noises on wages from both the Fed and the ECB there is little sign we’re returning to the…
US equities have hugely outperformed their international peers over the long haul and other US financial assets in the short…
There have been various points of blame for weak auto sales. The most under-appreciated input has been technological innovation, as…
America’s trade conflict with China reflects two things. First, the angst of a declining US power. Second, the ego-centric conflict…
Unlike most geopolitical phenomena, populism is not a high-impact low-probability event. It is hard to run your life (or portfolio)…
The markets have been given two adrenalin shots to boost the Santa Claus rally: Fed Chairman Powell’s statement that the…
Global economic growth has peaked almost everywhere. This cancels most of our long-term fixed income shorts, with the exception of…
Globalisation was not a perfect process. While it hefted living standards emerging markets, the trade-off was a stagnation of incomes…
