With almost every investor out there claiming deep commitment to the environmental, social and governance (ESG) cause, one issue on which there is surprisingly little debate is that of cryptocurrencies.
Investor enthusiasm for these two new buzzwords in the investing world is high, but few people are ready to admit that they are mutually exclusive: you cannot claim to focus on ESG and own Bitcoin at the same time.
Continue readingRecent capital flows highlight a paradox: investors are afraid of inflation, but seem to have increased their allocation to just the assets that would do worst out of it.
Continue reading“Transitory” is the preferred word to describe inflation these days. Central bankers love it, because it means they can continue their easy money policies. Investors love it, because it means the markets’ party goes on.
Continue readingEven those who still do not believe that climate change is a serious threat to our way of living will need to pay attention: it could turn out to be the next Black Swan for financial markets.
Continue readingThe Covid-19 crisis is one year old, and already, on the economic front at least, optimism is gaining ground.
The International Monetary Fund (IMF) economic growth projections, released last week, point to a strong rebound: the world economy is forecast to expand by 6% this year, led by emerging and developing Asia, which is expected to grow by 8.6%.
Continue readingWith baby steps, the Fed and other major central banks are beginning their journey back towards some semblance of normality.
This will be a big resilience test for a financial system which, for more than a decade, has relied on repeated rounds of monetary generosity. Continue reading
The turmoil we are currently seeing in stock and bond markets is just one battle in the war that has been going on in capital markets for a long time: debt versus equity versus central banks.
Continue readingWith news of another Covid-19 vaccine on its way and optimism rising ahead of the end-year holidays, it looks like 2021 will shape up to be much better than 2020.
But one forgotten danger could spoil the party: inflation. Price rises are far from investors’ minds, but an ‘inflation tantrum’ could have devastating effects on various countries’ economies if they are not kept in check.
The markets rallied so fast in November that bullish investors risk pushing the needle towards the “Sell” signal, according to Bank of America’s indicator.
If you are wondering what’s behind the sudden largesse of the European Central Bank (ECB) when it comes to purchases of bonds, you may find a recent speech by an ECB official at a conference about financial stability enlightening.
While regulators focused on making banks safer following the 2007-2009 financial crisis, the non-bank financial sector has been allowed to continue without the same stringent requirements for liquidity and leverage. This gap came into sharp focus during the crisis caused by the Covid-19 pandemic.