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Update: Trade Wars

Thursday, April 26th, 2018

Extract from the March 2018 quarterly report: While Donald Trump’s tariff hikes have triggered trade war fears, it is difficult at this stage to know how far a retaliatory cycle of tariff increases would go. This is because he appears to be using tariff increases or threats thereof as a negotiating tactic to reverse unfair […]

Update: Ships Ahoy!

Tuesday, January 30th, 2018

Extract from the December 2017 quarterly report: With global growth set to reach 4% in 2018, the improved outlook to which we referred last quarter has become more entrenched and we like Investec’s quote: “All rooms sea-facing in 2018”. This implies demand for later cycle assets, commodities and emerging markets. Country specific policies such as […]

Update: Goldilocks Zone

Friday, November 10th, 2017

Extract from the September 2017 quarterly report: We have expressed the view repeatedly in previous commentaries that going for growth globally was the only sensible option available to policy makers in the major economies and thankfully it appears that this is succeeding. According to Christine Lagarde, the Managing Director of the International Monetary Fund (IMF), […]

Update: Pro-Growth Policies

Friday, August 11th, 2017

Extract from the June 2017 quarterly report: Since the global financial crisis of 2008, both global growth and inflation have responded very anaemically to unprecedented levels of monetary stimulus, these days known as quantitative easing or “QE”. The reasons for this are many and complex, and do not appear to be sufficiently understood by both […]

Update: A Stimulatory US Should Prevail

Thursday, May 11th, 2017

Extract from the March 2017 quarterly report: Although the European Union (despite Brexit) and China are major role players in the world economy, the US still retains a pre-eminent position as the world’s primary importing and consuming nation. As such, its fiscal and monetary policies have a greater potential to affect global growth than those […]

Update: Return To Reagonomics?

Thursday, January 26th, 2017

Extract from the December 2016 quarterly report: While it is still too early to see if US President-elect Donald Trump practises what he preaches, if he honours his campaign promises in respect of fiscal stimulation (but not trade tariffs) we would view it as very positive from an economic point of view. If you refer to […]

Update: Taps Off

Tuesday, November 1st, 2016

Extract from the September 2016 quarterly report: In our view it is incorrectly perceived that US monetary policy is still very loose, partly due to excessive focus on the FOMC’s policy target rate. Of far more importance are other market-related interest rates e.g. LIBOR (chart 1) which indicate that US monetary policy is not as loose as […]

Update: Stimulus & Austerity

Wednesday, July 27th, 2016

Extract from the June 2016 quarterly report: Although the UK referendum vote to leave the European Union (“Brexit”) has been getting the headlines recently, the UK economy is less than 4% of global GDP. Of far more importance to the medium term outlook for global economic health is the stance of, and balance between, fiscal and monetary […]

Update: Bottom found

Wednesday, May 25th, 2016

Extract from the March 2016 quarterly report: It is quite possible that unjustifiably deflationary global monetary policies have been a major force behind the fall in commodity and share prices, particularly since mid-2014. However a central banks-led reversal appears to have now happened with the MSCI All Countries Metals and Mining Index rising 43% in US$ […]

Update: Central Banks & Deflation

Wednesday, February 3rd, 2016

Extract from the December 2015 quarterly report: The widely expected but largely irrelevant 0.25% increase in the US Federal Open Market Committee (FOMC) target interest rate in December remains a red herring to the proper assessment of US and global US$ liquidity conditions which in our opinion remain dire and accordingly very deflationary. While it could […]

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