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Entries Tagged as 'The Markets'

Just What The Doctor Ordered

February 6th, 2018 · Comments Off on Just What The Doctor Ordered

Two years ago, the world economy looked downright scary, with secular stagnation ravaging much of the developed world, stagnant wages, low productivity growth and various serious crisis spots. But growth returned and it took the immediate sting out of these dangerous situations, like a eurozone break-up, Chinese capital flight and emerging market dollar debt. While […]

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Tags: The Markets · World Economy

Rising U.S. Risk Premium?

January 29th, 2018 · Comments Off on Rising U.S. Risk Premium?

Contrary to the expectation of many pundits, the dollar has softened considerably. We explain why this is surprising and discuss one proposed theory in an attempt to explain this, looking at ‘credit inflation.’ We also discuss another idea, a rising U.S. risk premium due to increasing U.S. turbulence. Source: Rising U.S. Risk Premium? | Seeking […]

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Tags: The Markets

A Trump Effect?

January 28th, 2018 · Comments Off on A Trump Effect?

Apart from business sentiment and the stock market, hard data does not display a decisive acceleration in the economy. But it’s early days and the tax cuts have yet to take effect. The IMF expects a significant acceleration in investment and growth for the US this year. However, there are also other tailwinds blazing in […]

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Tags: The Markets

Which Is A Bigger Threat For Stocks, Bonds Or The The Dollar?

January 16th, 2018 · Comments Off on Which Is A Bigger Threat For Stocks, Bonds Or The The Dollar?

According to many experienced commentators, the decades-long bond rally is coming to an end, or has already done so. Normally, a bond selloff would be bad for stocks, but there are those who argue exactly the opposite. However, we find the relation between stocks, bonds and the dollar is all over the place. Source: Which […]

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Tags: The Markets

A Chinese Lost Decade?

December 25th, 2017 · Comments Off on A Chinese Lost Decade?

The Chinese economy is facing three secular headwinds that conspire to slow its economic growth considerably. Demographics are turning from a tailwind to a headwind and diminishing returns of the credit led boom have already set in. The necessary deleveraging process isn’t likely to produce a financial implosion, but it will slow growth significantly and […]

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Tags: China

The Tide Is Turning

December 25th, 2017 · Comments Off on The Tide Is Turning

The world economy is experiencing a synchronized upturn, but the main areas are already tightening monetary policy, or about to do so. This will reduce world liquidity and provide a headwind for equities to run higher, depending on the pace of it. However, the biggest risk is that US monetary conditions tighten much faster than […]

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Tags: The Markets

The Consequences Of Permanently Low Interest Rates

November 29th, 2017 · Comments Off on The Consequences Of Permanently Low Interest Rates

It is possible that, in the absence of rising inflation, interest rates remain extremely low for much longer. This has several important consequences for asset prices and the dollar, for instance. Add large tax cuts and financial deregulation in the mix and the cocktail becomes risky. Source: The Consequences Of Permanently Low Interest Rates | […]

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Tags: Economy · The Markets

What China Can Teach Us About Economic Growth

November 27th, 2017 · Comments Off on What China Can Teach Us About Economic Growth

After the enactment of US tax cuts supposedly comes infrastructure spending. As experiences go, the latter is likely to be a bigger booster for economic growth. While the US economy actually doesn’t need any kind of stimulus right now, it does need better infrastructure. These plans would have been much better half a decade ago […]

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Tags: China · Economic Policy

As Good As It Gets?

October 27th, 2017 · Comments Off on As Good As It Gets?

Goldman Sachs argues that the synchronized growth spurt in the world economy is unlikely to last. We can only hope it does, at least for a while as it takes some of the sting out of the biggest risks in the world economy. Throwing oil on the fire in the form of pro-cyclical policies seems […]

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Tags: The Markets

FANG: The Default Stocks To Buy When The Market Misbehaves?

October 24th, 2017 · Comments Off on FANG: The Default Stocks To Buy When The Market Misbehaves?

Cramer argues that FANG stocks have become “the default stocks to buy when you get freaked out,” supposedly by market trouble. If he is right and these stocks sell off only very mildly in a serious market correction, investors can have their cake and eat it. That is, they would have both considerable market insurance […]

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Tags: The Markets