The real threat to European equities is growth, not political risk. How low will Eurozone earnings fall during the coming recession and how much will equities decline in response?...
The cyclical economy is slowing today. Republicans are now more likely to win a full sweep, crack down on immigration and trade, and at least modestly stimulate the economy. Uncertainty and volatility will rise....
Today’s attempted assassination against President Trump challenges the consensus view. It will ensure that President Trump’s supporters are highly motivated for the upcoming general election. And it may return many supporters who had drifted away from the former president back into the fold....
In this report, we present the quarterly review of our Model Bond Portfolio. Rebounding growth and political instability led to slightly negative portfolio performance in Q2/2024. As global growth starts to moderate, we continue to favor government bonds over credit. Maintain a defensive portfolio s...
US dollar liquidity has been shrinking, which has important ramifications for global asset prices, including currencies. In this report, we delve into the process of dollar liquidity creation and the outlook for currencies over the next six-to-twelve months....
A global economic downturn will be a headwind for natgas prices over the cyclical horizon. Thereafter, LNG capacity additions will help keep the market in balance into the end of the decade. That said, Europe’s increased dependence on global LNG flows raises its exposure to market dynamics in the re...
The conventional wisdom is wrong: Trump is not going to substantially cut taxes once in office; he is going to raise taxes by jacking up tariffs. To the extent that this dampens economic activity, it is bad news for stocks but good news for bonds....
The failure of EM stock prices to rally over the past 13 years is rooted in their companies’ inability to grow their profits. Even though EM equities appear cheap based on their cyclically adjusted P/E ratio, there has been a regime change in EM corporate profitability. Therefore, the CAPE model sho...
We project US Multifamily cap rates to increase from 5.2% to 6.5%. While we find an unfavorable risk-adjusted return on the asset, especially relative to other opportunities in CRE, cap rates are moving closer to peak....
