Credit Writedowns

Volatility is still elevated in US equity markets. Rising real yields are the big factor there. All signs are that real yields can continue to rise. But going forward, globally, some other issues to consider are household debt and the ECB's…

Rotating into emerging market equities as the US market soars is Jeremy Grantham's recommendation. That's a daunting prospect for most US retail investors. Here's why.

Albert Edwards says the Fed will tighten more aggressively. The increase in interest rates will be a stimulant at first. But eventually, the higher rates will catch up with debtors.

Rising inflation expectations are pushing interest rates higher. But Fed moves matter more. If the data continue to show growth in the economy, markets will move toward the Fed and interest rates will rise.

The rise in inflation is necessary but not sufficient to force the Fed to tighten even more aggressively than it has forecast.

Low interest rates in the UK show how powerful expectations of future central bank policy action is on bond markets given rising inflation.

While the consensus narrative fears of rising inflation triggered equity sales has much to recommend itself, there is a major discrepancy. 

Fear political populism and the loss of democracy but embrace economic populism as necessary.

Sometimes governments choose to mimic the private sector and amplify the trend in the economy. This is called pro-cyclicality - and in worst case scenarios, it can be quite destabilizing.

This month, we have seen an unprecedented increase in volatility. When the fundamentals take a knock, that’s when we should worry though. Let’s wait for the CPI next week and revisit this conversation.