The first year of the new decade begins with markets in a much more exuberant mood than at the beginning of 2019. Some of the world’s most important stock markets reached record highs in the last month of 2019 — but do investors feel that markets have peaked?
By Michael Brett
So Boris, as he likes to be called, hopes he can reassemble a disjointed Britain. Under his benign leadership families that were torn apart by violently differing views on EU membership can be restored to harmony and domestic bliss.
The 29 million-odd people WHO DID NOT VOTE TO LEAVE THE EU in the 2016 referendum are to be dragged out willy-nilly to satisfy the 17.4 million who voted to leave. This is widely hailed as democracy.
Brexit rules the waves (which, incidentally, can only be used in future to transport goods at the cost of a hell of a lot more paperwork, restriction and delay). We will be poorer in the future than we would have been as EU members. Even the would-be leavers are forced to concede this.
How on earth did we land in this situation?
Sentiment in the markets ahead of the UK election is eerily similar to that before the referendum on European Union membership in June 2016. Complacency seems to have the upper hand, so if the election result is a surprise, expect a sharp readjustment.
Brexit is the main issue of the election campaign, but those who believe the Prime Minister’s slogan that the can “get Brexit done” are deluding themselves.
When he finishes negotiating his “deal” with China, US President Donald Trump will probably try to take credit for the country’s shrinking current account surplus with the rest of the world.
However, the fact that China’s exports are slowing is not a new phenomenon, and it is not necessarily a reason to celebrate.
The central banks’ “extraordinary” and “non-conventional” measures are now more than a decade old and they are still going strong.
If initially they were only supposed to last for a few years after the financial crisis of 2007-2009 until things “went back to normal”, this expectation was quietly dropped once it became clear that the extraordinary had become ordinary.
But as these measures continue, their toxic side effects are increasing. They may in fact be contributing to the sluggishness of the world economy and to the lack of productive investment, rather than counteracting them.
Of all the fears sweeping the markets right now, perhaps the most worrying is the fear of a debt crisis in the corporate sector.
Warnings about corporate debt rising to unsustainable levels are intensifying, at a time when interest rates are at record lows and even Greece joined the club of negative-yield sovereign debt issuers.
The fourth quarter of the year started with heightened volatility and rising uncertainty and is likely to continue this way, despite some green shoots in the first part of October.
How seriously is Wiley taking its European customers? The NYSE-listed provider of professional education services doesn’t seem to be aware of basic consumer rights legislation in Europe and the UK.
European customers should expect the final price they pay for Wiley’s products to be higher than advertised, even when offered a discount.
Caught in the middle of the Brexit saga, European investors can be forgiven if they glossed over a speech by Fed Chairman Jerome Powell that could turn out to be the starting point of a very risky period for the global economy.
It’s no secret that President Donald Trump would want the Fed to cut interest rates and debase the dollar. Earlier this year, he called the Fed “crazy” and Powell himself, “clueless.”
Of course, Powell did not immediately show that these repeated attacks influenced his policy. However, in a speech he gave last week he reiterated his fondness for a very risky idea on how to ease monetary policy even further.