Wednesday was new Federal Reserve Chair Janet Yellen’s first meeting at the helm. Stocks sold off pretty hard after the announcement but rebounded yesterday. Neither action was very surprising; stocks are still quite over-extended and investors seem to have a quick trigger finger looking for any reason to sell and take profits. At the same…
Why Emerging Market Stocks are Falling
The Emerging Markets were all the buzz this week, with India, Turkey and South Africa raising interest rates in an attempt to slow capital outflows. Since the 2008 crash, Emerging Market (EM) stocks have not been the same for US investors, significantly underperforming developed market stocks. Unfortunately I think they’re going to remain under pressure…
Why There is Trouble Ahead for the European Economy
There was an interesting chart in The Economist displaying GDP growth since 1999, the start of the Eurozone, for Western economies. From a quick glance at the chart, it appears that Germany is the impressive winner, generating over 20% change in GDP per person. Spain, Greece, Portugal and Italy don’t look so good… But…
The Investment Markets in 2014
2013 was certainly an eventful year both politically and economically and I think 2014 will prove to be just as interesting. The biggest concern I see over the next year is the amount of civil unrest that is building. For some reason governments think corruption and higher taxes will go unnoticed… In 2013, we saw…
Technology and the Future
It’s astonishing to see how quickly technology is changing things. Two things that jump out at me and have certainly received a lot of media attention lately are drones and Bitcoin. A lot of companies, including Amazon, are testing the use of drones to deliver packages to your home. It seems so futuristic to think…
China’s Economic Rebalancing
Chinese officials announced that they’ll be easing their intervention in the currency market to let the yuan trade more freely as well as gradually removing caps on deposit rates. These are two big steps in the right direction for China to rebalance their economy with less of a reliance on government driven investment and a…
Inflation or Deflation?
I’ve noticed lately that inflation continues to “surprise” to the downside, to a small degree here in the US but mainly overseas (notably Europe, Australia and Canada), creating expectations of further monetary easing. This is leaving many people who have been calling for hyperinflation and the collapse of fiat currencies scratching their heads. They say…
Global Imbalances & Expected Investment Returns
There has been a lot of news lately that has me thinking about the bigger picture of where the global economy is heading. I’ll touch on each of these separately and then tie them all together with my macro view at the end. I should say in advance that as a fiduciary of other’s money,…