Forecasts

This isn't going to be a thematic post on how to profit from Europe's breakup, despite the sinister title. Instead, it’s a potpourri post - a mashup of different ideas I have right now and want to run by you to organize my thinking about…

This is a quick post about the US economy. To put it simply, I am upbeat about what the near-term holds for the US economy. I have lots of doubts about the longer term. But whereas I might have led with the doubts earlier in the year, as…

The Bank of England has cut interest rates and started a quantitative easing program that includes both government and corporate bonds. This approach was enough to send the pound Sterling down to $1.31 and 10-year gilt rates to a record low…

This is a quick run through of the post-Brexit vote decision tree. The opportunities and constraints after the UK vote to leave the EU are now coming into view. It is clear that the UK is likely to leave the EU given not only statements by…

The unexpected ‘Leave’ victory in the recent referendum on EU membership introduces considerable political risk by elevating tail risk scenarios to reasonable worst case status. However, in a global economy that is already slow and already…

As I start this post, I am naming it "Why I'm on US recession watch despite 2% growth". I don't know if that name will stick when I publish this piece; nonetheless, that is the theme I am trying to get across. When I look at the economic…

I've been following the Fed's forward guidance recently and, frankly, I find it confused. On the one hand, it was a clear mistake to have raised rates in December. We see this now in retrospect due to the tightening of financial conditions…

Perhaps we are misreading the Fed’s intentions going forward because multiple Fed officials are signaling the Fed’s intention to raise interest rates multiple times in 2016 and 2017. And while rate hikes are usually considered tightening,…

The latest jobs report came in at 160,000 jobs added to US non-farm payrolls. As this number was below expectations, it effectively sidelines the Fed in June. And given we are in an election year, the chances of two rate hikes occurring are…

US and global economic growth is slowing. And this has caught the Fed out given its rate hike in December. The question, now, therefore is whether the Fed continues to hike in the face of this slowing, given the election looming in…