The recent inversion of the US Treasury yield curve has had the financial press in a bit of a frenzy. I see a glaring contradiction in the fact that so many market participants and commentators emphasize the heightened level of economic uncertainty, and at the same time seem to consider flat or inverted yield curves as foolproof predictors of a recession. I see this as … [Read more...] about Yield curve hysteria
European Union (EU) President Jean-Claude Juncker leaves his post in October, after five years in the role. At the start of his term, we wrote about Mr Juncker’s key priorities in his first 100 days, encouraging him to be bold on political, economic and social issues. Five years later… well, not much has been done to address the malaises that afflict the world’s largest trading … [Read more...] about A manifesto for Europe
After a long period of relative calm, investors have faced more volatile markets in recent months. In Q4 last year, the S&P 500 came within 63 basis points of a technical bear market, dropping -19.37% from a high of 2,930 in September to a Christmas Eve low of 2,351. Risk assets have since recovered ground, but with volatility likely to remain higher in 2019 and global … [Read more...] about Will there be a US recession in the next 12 months?
In the “Year of the Pig”, China will likely continue grappling with slower growth, a mountain of debt and a trade war with the US. But according to Chinese legend, the pig is a sign of good fortune – which is consistent with our long-term view of China’s economic potential. Fattened up on debt and penned in by trade? We expect China may deliver slower growth in the near … [Read more...] about Will the “Year of the Pig” be a prosperous one for China?
There is no easy solution to the problem of rising economic inequality, but we may be able to address it with a more enlightened tax system – one that maintains incentives for work and investment while improving economic efficiency. … [Read more...] about Tackle inequality by transforming the tax system