Highlights Without a true banking union it is impossible to have a true monetary union. The result is a fragmented monetary policy. A fragmented monetary policy with an inflexibly rigid fiscal policy is a recipe for economic and…
Highlights Real Rate "Targeting": Global central bankers are increasingly following the Fed's lead by paying more attention to the appropriate level of real interest rates that will keep inflation stable given low…
Highlights Paradox 1: U.S. growth will slow, and this will force the Fed to raise rates MORE quickly. Paradox 2: China will try to stimulate its economy, and this will HURT commodities and other risk assets. Paradox 3: Global…
Highlights Global QE has made bonds as risky as equities. Thereby, global QE has forced investors to accept identically depressed returns from equities and from bonds, requiring equity and other risk-asset valuations to surge. The…
Highlights President Trump has expressed dissatisfaction with the Fed's policy tightening. However, we do not think he will be able to influence policy in a dovish fashion this cycle. Trump has suggested that many nations are…
Highlights FTSE100 = Overweight global Oil and Gas in pounds. Eurostoxx50 = Overweight global Banks in euros. Nikkei225 = Overweight global Industrials in yen. S&P500 = Overweight global Technology in dollars. Of these four…
Highlights Global Yields: Flattening government yield curves in the developed world have raised concerns about a potential future growth slowdown. Yet real policy rates will need to move into positive territory before monetary policy…
Highlights The real culprit for the mushrooming U.S./euro area trade imbalance is the ECB, and specifically its post-2014 experiment with ultra-loose monetary policy. There could be a major sea-change in ECB policy after November 2019…