Economics & Strategy

09 March 2015
The pullback on Wall Street has commenced. It should be the catalyst for consolidation in Europe’s markets. Any market pullback in Europe at this time should be brief. The rise in yields of longer duration Treasuries since end-January sends the signals we require. The effects of the appreciation of the US$ can now be discerned in US economic data and in the behaviour of Wall Street. Although we suspect that the time of the long-awaited consolidation of the US$’s gains is arriving, at least relative… read more
02 March 2015
Our interpretation is that the acceleration of the behaviour of financial markets since the beginning of the year announces the re-acceleration of growth in nominal terms in the developed world from this time. We explain why the ECB’s QE may produce a positive surprise. We may be under-estimating the scale of reallocation of funds within the euro system. We are witnessing a rapid resurgence of EZ narrow money aggregates. The recovery of the depressed profitability of EZ equity since the watershed… read more
23 February 2015
The global US$ value of equity assets has broken through the defensive frontier that has been defined since mid-2014 thanks to renewed multiple expansion and the return of smaller cap out-performance. February has brought clear evidence that the phase of defensive leadership in trans- Atlantic markets is complete. Market breadth is increasing. Active fund management should benefit. European equity has registered its strongest start to an investment year since 1997. However, at this point we think… read more