The Chinese economy is already slowing down, its stock market is crashing, its currency sinking and authorities are cracking down on leverage. And on top of that the US has imposed tariffs on some Chinese exports and is threatening to greatly escalate this program. Given the capital flight and the stock market crash, one is […]
Entries Tagged as 'The Markets'
July 25th, 2018 · Comments Off on Crisis In China?
July 20th, 2018 · Comments Off on Why The Stock Market Hasn’t Buckled Under The Trade Tensions
After some wobbles when trade tensions hit the headlines, the markets seem to have regained their footing. For some, this seems odd, given the all to real potential for a serious escalation into a full blown trade war. We’ll look at some reasons why the markets may have started to live with the trade tensions. […]
May 22nd, 2018 · Comments Off on Argentinian Canary In The Coal Mine?
Argentina seems to be the first victim of a more difficult international climate for emerging markets. In a way, this is somewhat surprising as the country isn’t on the brink of a default and there aren’t bank runs and the economy still grows, this isn’t 2001. However, there are no easy solutions and should the […]
Tags: Emerging Markets
April 30th, 2018 · Comments Off on The Great Slowdown?
There are signs that world economic growth is slowing down, although it’s not clear whether this is just a blip or the beginning of a more lasting trend. Lower growth would be especially toxic if accompanied with higher rates and a higher dollar. Equities seem to be pricing in at least some of these possibilities […]
April 18th, 2018 · Comments Off on Technology Shares Out Of Fashion?
Bank of America argues that investors should lighten up on technology stocks. We think this is way too general an approach, investors are much better off on a case-by-case analysis. Of the valuation issues and risks they mention, only the one about a possible fallout of the recent trade tensions seems a valid concern. Source: […]
April 17th, 2018 · Comments Off on Chinese Investor Strike?
Macro lessons for investors part II. Some argue that the US trade deficit is simply the result of big US public sector deficits and debts (which need to be refinanced), needing foreign investors. As a result, they argue, the Chinese could strike back by stop buying US Treasuries, or even dumping their $1T+ Treasury holdings. […]
Tags: The Markets
April 16th, 2018 · Comments Off on Macro Lessons For Investors
Macro forces are impacting financial markets continuously; investors do well getting to grips with the basics. However, there are wildly different views about how the economy works, and the debate is tainted by politics. In dramatic circumstances like the immediate wake of the financial crisis, choosing the right economic model can make a dramatic difference […]
April 13th, 2018 · Comments Off on Have We Seen The Highs For The Year Already?
If trade tensions escalate, it could tip the world economy, which is already softening into substantially lower growth. Apart from the direct effects of trade restrictions, greater uncertainty, diminished sentiment and resulting risk aversion could put quite a damper on markets and start affecting the real economy. As we will explain, what will happen in […]
Tags: The Markets
April 6th, 2018 · Comments Off on Risks Are Increasing
Market risks are increasing with a more assertive President, less constrained by mainstream advisers repositioning into a more populist and neo-conservative direction. The more immediate worry are the chances of escalating trade conflicts, a direct result of the populist turn. But there are a couple of saving graces, at least for now. Source: Risks Are […]
March 31st, 2018 · Comments Off on No Reason To Panic
But panic there was, with the VIX rising from the dead all the way to 35. A reassuring sign is that bonds, which arguably started the market mayhem, functioned as the traditional safe haven. Earnings growth is still solid, some air has to escape from stretched valuations. It’s unlikely, but not impossible this turns into […]
Tags: The Markets