investing

QE is still on, but central banks are pondering exit pathways. Exit requires vacuuming up excess reserves, winding down massive securities holdings, and restoring normal interest rates – all without killing the recovery. This column points…

Over the past few years, investors who have expected aggressive monetary policy to produce high levels of consumer price inflation and have invested accordingly have been disappointed. The right question goes to why consumer price inflation…

We update our views on the main big picture drives for financial market: (1) Fed tapering (2) The stabilization of the Chinese economy (3) The cyclical recovery in Europe (4) The increase in Japanese purchases of foreign bonds

Regardless of the metric that you use, deviations from the long term growth trend are unstainable and will eventually mean revert.

The P/E ratio is a statistic that, while all-encompassing, can be misleading in determining under- and overvaluation. Nonetheless regarding valuation it can be a useful guide in context.

My caution on U.S. markets is based not just on technical factors coming from the crisis in emerging markets and the longstanging lack of a market correction. I am also concerned that interest rates have started to rise against a backdrop…

The histogram below shows the total return of long-dated treasuries over a rolling 4-month period since 2007. The leftmost bucket contains five periods that constitute the worst treasury losses since 2007. All five of these periods ended…

The gain in equity prices is now outpacing profits at a rate not see since the heady dot-com days. In fact, on a GAAP accounting basis, profits have been falling. I believe this creates a dangerous situation in view of rising interest rates…

One often hears the refrain "the market is not the economy", but what does that really mean? I am going to explain it in my terms here in the context of the global reflation trade - EM meltdown paradox.

If you look at the last two posts on this site from Marc Chandler and from Sober Look the connection between Fed tapering and money flows is clear. Hot money is flowing out of emerging markets and into Europe.