Beyond Bulls & Bears

Card image cap
Fixed Income

Finding the Positives from a Tumultuous Week in Europe

While I think it’s important to continue to look at the underlying fundamentals, I maintain that politics and monetary policy will the most important drivers of financial markets over the next year.

Card image cap
Fixed Income

Why Markets Are More Cautious About the Next Potential Political Pitfall

Although the Italian constitutional referendum may seem parochial compared with the US election or the Brexit vote, it has the potential to bring further uncertainty to a European Union which is already struggling to digest the implications of Trump’s victory.

Card image cap
Fixed Income

Global Economic Perspective: November

We do not believe a Trump presidency will materially alter the course of the US economy in the near term. Fundamentals ultimately drive longer-term performance in the fixed income markets, and in our view, these remain broadly supportive of a slow but steady rate of expansion.

Card image cap
Fixed Income

Hasenstab: US Election Rhetoric vs. Realities

I think we learned a lot from the post-US election market reaction. We learned which markets are vulnerable, which were oversold, and by and large, see some of these market dislocations as an opportunity if we can sift through them.

Card image cap
Fixed Income

Fixed Income Markets and the US Election: What Really Matters

In terms of US monetary policy, on balance we don’t think the election itself will materially impact the path of interest rates unless the economic fundamentals materially reversed. Additionally, the passage of election uncertainty should remove another potential objection to continuing on a gradual tightening path.

Card image cap
Fixed Income

Global Economic Perspective: October

While heartened by the bounce in oil prices after the multi-decade lows reached early in the year, any significant further rally in energy prices would seem to us to require a far more vibrant global economy. As the IMF’s (and the Fed’s) relatively subdued outlooks make clear, it is hard to anticipate such a scenario occurring anytime soon.

Card image cap
Fixed Income

US Election Implications for Europe: What Many Observers Are Missing

It’s fair to say that global referendums held recently have not proved terribly successful for their organisers. Whether that unhappy tradition continues with the Italian referendum on constitutional reform scheduled to be held on December 4 remains to be seen.

Card image cap
Fixed Income

Global Economic Perspective: September

The BOJ provides perhaps one of the most extreme examples of the repression of interest rates by central banks. At some point, Japan—along with other countries that have embarked on such untested monetary policies—may be forced to address the distortions it has imposed upon its markets.

Card image cap
Fixed Income

Snapshot View: Fed Remains on Hold

If the United States is actually experiencing a 'new normal' where growth remains lower long term, then the Fed risks fueling real or asset-price inflation by being too lax with monetary policy going forward.

Card image cap
Fixed Income

Will the Fed Take a (Rate) Hike?

With major US market averages hovering near all-time highs and the US economy showing modest growth, I believe that the Fed has the ammunition it needs to pull the trigger and raise its short-term interest rate, possibly this year.

Card image cap
Fixed Income

Why Higher Interest Rates Could Draw Yield-Seekers to Leveraged Loans

We believe that having a possible deluge of perhaps unqualified borrowers flood the market will make fundamental and independent research even more important for potential investors in this asset class.

Card image cap
Perspectives

Global Economic Perspective: July

In terms of monetary policy, we had expected the BOE to move into easing mode, though it chose not to do so at its July meeting, but we think the ECB will try to gauge the impact of the UK result, rather than rush to expand or extend its current program of bond purchases.