• Current Reports  

    Published on September 2nd, 2014

    Beijing is tightening its control over Hong Kong’s institutions and political processes. Last week anti-corruption agents raided the homes of three of the city’s prominent pro-democracy figures. Then on Sunday Beijing handed down a long-awaited decision on constitutional development which crushed the city’s hopes for open elections. China’s increasing influence over the nominally-autonomous territory is deeply resented by many in the former British colony. Following Sunday’s announcement, activists have promised a campaign of civil disobedience to demand full democracy for the city, a prospect which has prompted critics to warn that business in Asia’s leading international financial center will be severely disrupted, that protests could spill over into violence in the streets, and even that China’s People’s Liberation Army could intervene to restore order...
    Published on September 2nd, 2014

    In late July and early August Anatole went up the mountain so to speak and penned a series of articles that aimed to explain where we were in the current market cycle, and more importantly where we are likely headed. With most major asset classes continuing to head higher we thought it worth republishing Anatole’s consolidated thinking in a single document. Please click on the pdf link above, or, alternatively, the articles can be read individually via the web links listed below...
    Published on September 1st, 2014

    Europe’s political leaders may be talking about fresh sanctions on Moscow, but the continent’s remaining economic optimists are fast capitulating in the face of Russian aggression in Eastern Ukraine. Both the European Commission’s eurozone economic confidence survey and the INSEE French business confidence survey, released late last week, deteriorated in August, with the EC survey slumping to its gloomiest reading this year. This decline in sentiment reverses a divergence between softening ‘hard data’ and survey results that until recently were relatively upbeat. However, instead of the hard data grinding higher as the optimists had hoped, the surveys have slumped lower. It is now obvious that the eurozone has got itself into a veritable economic funk. Behind this funk is a confluence of forces including...
    Published on August 29th, 2014

    The US has managed a steady but sub-par economic recovery with the crucial missing ingredient being a sustained pick-up in capital spending. There is some evidence this may be changing since yesterday’s second revision for 2Q14 GDP pointed to the main two engines of investment spending starting to fire simultaneously. It may be too early to declare the start of a new capital spending cycle, but for pretty much the first time since the post-2009 recovery started, both private residential and non-residential fixed investment look to be turning up together...
    Published on August 28th, 2014

    The US housing market seems to be coming off the boil with the latest national price measures pointing to significantly reduced gains. The worry is that professional investors are pulling back from the market as the share of home purchases made with cash fell to 37.9% in 2Q14 from a high of 42% the previous quarter (see report). Private equity firms such as Blackstone Group, the largest private landlord in the US, have bought an estimated 200,000 homes since 2009 as overburdened households handed back the keys to their suburban units and started to rent. As a result, the US ownership rate has slid from a peak of 69% in the mid-2000s to about 65% by June. So is it a case of the clever money winding down its interest as the quantitative easing-inspired boom-let of the last three years approaches an inevitable reckoning?...
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