Does the US have enough firepower to fight the next recession?

With interest rates already near record lows, what’s left in the Fed’s arsenal to fight the next recession? Low starting interest rates means that the Federal Reserve (Fed) may need to expand its policy toolkit to fight an economic downturn. But if this proves insufficient, fiscal policy need to pick up the slack. The go-to … Continue reading “Does the US have enough firepower to fight the next recession?”

Embracing change in European real estate

Real estate is typically a slow mover in the investment world. It tends not to be affected by the day-to-day rumblings in the equity and bond markets. Nevertheless, change is still afoot in real estate, with both short- and long-term trends affecting how we use properties and how we invest. Real estate is now at … Continue reading “Embracing change in European real estate”

Does the Trump-Kim summit matter for investors?

If North Korea gives up its nuclear arsenal, Donald Trump has promised that the country will have an “awesome” economic future with a wealth of opportunities on offer. The US president is not alone in seeing vast potential in the reclusive Asian nation. Billionaire Jim Rogers, one of the world’s most successful investors, famously said … Continue reading “Does the Trump-Kim summit matter for investors?”

The Brexit deadline looms

The UK ended February with the question of Brexit still unanswered.  The month was dominated by political newsflow as concerns over Brexit were compounded by the resignation of eleven MPs who left the Conservative or Labour parties to form ‘The Independent Group’.  A second ‘meaningful vote’ on Prime Minister Theresa May’s Brexit deal will take … Continue reading “The Brexit deadline looms”

Pressures on the EU as elections loom

We are in the long run up to the European Parliamentary elections. This will be followed by the appointment of a new European Commission. It means there will be an argument over the future direction of EU and euro policy, with a wide range of views from those who with En Marche in France want … Continue reading “Pressures on the EU as elections loom”

Is Brazil the new Saudi Arabia?

Could forestry’s importance in reducing carbon emissions and the rising cost of carbon credits change the world economy?  Forestry is a key element of the carbon emissions reduction puzzle. Trees cover 31% of the world’s land surface, equal to just over 4 billion hectares1. Each hectare of forest removes about 10 tons of carbon dioxide … Continue reading “Is Brazil the new Saudi Arabia?”

Car crash in the motor industry?

Last year was not a good year for the world motor industry. Passenger car sales fell by 13% in the USA, by 9% in the UK, by 4% in China, by 3% in France and by 0.2% in Germany. In the USA higher interest rates reduced people’s willingness to take out car loans. In China … Continue reading “Car crash in the motor industry?”

Avoiding a corporate bond liquidity squeeze

Since the global financial crisis in 2008, aging developed-world populations, record low deposit interest rates and quantitative easing by the world’s major central banks have driven a global ‘search for yield’ by investors. For many years, this drove asset yields lower across the risk spectrum. However, since the start of 2018 the investment backdrop has … Continue reading “Avoiding a corporate bond liquidity squeeze”

Are investors too pessimistic on European shares?

European equities had a tough 2018 with the benchmark MSCI Europe index falling 10.6% over the year. Trade wars, reduced support from central banks and slower economic growth were among the factors that saw higher risk assets such as equities fall out of favour. Despite the difficult global backdrop, the eurozone economy continued to expand … Continue reading “Are investors too pessimistic on European shares?”

Will the world authorities do enough to stimulate their economies?

Markets signalled the slowdown now underway in industrial output and investment with a sharp sell-off at the end of last year. They challenged the Federal Reserve in particular to ease its tough stance, which it duly did as 2019 dawned. US policy is to spend more and tax less, offering some budget boost to the … Continue reading “Will the world authorities do enough to stimulate their economies?”

No time to be pig-headed

The trade war is dominating headlines and shaking investor confidence in China. But as we enter Year of the Pig, it’s worth remembering this is a long-term growth story. No sooner have the Christmas decorations come down than new ones have gone up to mark the Lunar New Year, which starts on February 5. It’s … Continue reading “No time to be pig-headed”

Trade: Will Trump rediscover the art of the deal?

The markets have two problems with US President Trump’s approach to the trade talks. The first is he is so unpredictable that it makes it very difficult for commentators and forecasters to come up with a well-based vision of what the future holds. The second is there is a nagging worry that the US China … Continue reading “Trade: Will Trump rediscover the art of the deal?”

Davos: world leaders miss out on the personal touch

In some ways Davos looks much the same as in previous years. The world’s great and good from politics, academia, business and the media have once again descended on Switzerland. The combination of all of these companies and leaders from around the world in an otherwise quiet and rural backwater is as incongruous as ever. … Continue reading “Davos: world leaders miss out on the personal touch”

Brexit plan B looks like plan A as prime minister rules out delay

The government risks losing control to parliament but probability of no deal remains as high as ever.  Having survived a vote of no confidence, Prime Minister Theresa May was forced to update the House of Commons on the government’s “plan B” for Brexit. In her statement, May promised to work with members of parliament (MPs) … Continue reading “Brexit plan B looks like plan A as prime minister rules out delay”