E.g., 24-05-2019
E.g., 24-05-2019
We have found 356 results.
View by: Grid List
Sort by: Relevancy Date
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    A Change In The Market Mood

    Thursday was an ugly day for global equity markets, with losses that brought total returns on US equities almost back to their January 2018 level, and non-US equities to the brink of bear market territory. It is hard to shake the feeling that the investment environment has changed. What lessons should we draw from the tumultuous trading session?

    0
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    Series: The Case Of The Missing Inflation

    As the Federal Reserve launched the second round of its quantitative easing, the fear was that the Fed’s unorthodox monetary policy would ignite a new round of inflation throughout the world, with dramatic effects on asset prices. After all, most asset prices are driven by the interaction of inflation and economic activity. But inflation failed to materialize, and even fell from more than 3% globally in 2010 to negative territory in 2015. These...

    0
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    How Contagious Is The Health Care Downturn?

    On paper, this should have been a good year for health care stocks: global growth has disappointed, long term interest rates have fallen, the US yield curve for a brief while was inverted and a looming US-China trade deal should see China buy lots of health care gear and drugs from the US. Yet, even though the stars aligned, health care has been the worst performing major US equity sector this year. Notwithstanding a bounce yesterday, the sector...

    0
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Case Of The Missing Inflation

    As the Federal Reserve launched the second round of its quantitative easing, the fear was that the unorthodox monetary policy would ignite a new round of inflation—even hyper-inflation—throughout the world, with dramatic effects on asset prices. But inflation failed to materialize, and now nobody seems to be worried about it anymore.

    5
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    Europe's Cruel Summer

    The eurozone is rapidly becoming the Errol Flynn of global economies: it just never fails to disappoint. From weak German PMIs, through falling French industrial production, to Italy slipping back into recession, it is hard to think of a single European data point over the past 12 months that gave any reason for cheer. Will things get better over the coming months?

    0
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    A Week Is A Long Time

    Harold Wilson, the former British prime minister’s, quip that “a week is a long time in politics” has become an over-used cliche. Still, in the last week, there has been good reason to dust it off.

    1
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    A Marxist Take On The Gilets Jaunes

    The "yellow jackets” still protesting in France have so far received only tepid support from the country's usually vocal trade unions. Similarly, left-wing parties have also been very slow to take to the street. This begs the question of what the oracle of the French intelligentsia, Karl Marx, would have made of this protest movement.

    10
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    Three Odd Things

    Reserves held by foreign central banks at the Fed are shrinking, which implies there aren’t enough US dollars in the system. This would make sense: the Fed has been draining excess US dollars for the past couple of years. So with shrinking central bank reserves and a shrinking US monetary base, the US dollar should be going up, and most risk assets should be hurting. Oddly, this isn’t happening.

    4
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Four Prices That Matter

    It is Gavekal’s longstanding mission to develop simple principles that investors can use to navigate complicated financial markets. In this vein, one of our core tenets is that four prices matter more than all others, and together these determine the level of global economic activity and of investor risk appetite. Let us see where they stand as we head deeper into 2019.

    12
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    A Future For Value Investing

    Financial theory teaches that, in order to determine the price of an asset, we should take its foreseeable future cash-flows, discount them by a risk-free rate to which we can add a risk premium, and then beyond these cash-flows ascribe a “residual value” to the business. So it’s an easy game—we only need to determine four things: the future cash-flows, the direction of the risk-free rate, the level of the risk premium, and the residual value....

    1
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    Drinking Red Wine And Buying Italy

    A Gavekal rule of thumb has it that investors can safely invest in economies where the “working class” mostly drink beer but should be careful in places where theymostly drink red wine. I make this observation as investors face a quandary among the wine drinkers: France versus Italy. The assumption in the spring was that holding Italian bonds was crazy, while French paper offered safety. But is that the case?

    1
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Evolving Trade War

    There is little doubt that the US president is surrounded by advisers who see China as a genuine threat to the long term economic health and geopolitical strength of the United States. But, it is likely that Donald Trump’s most immediate concerns are more down to earth. Specifically, in order to be re-elected in 2020, Trump needs once again to carry states such as Ohio, Michigan and Wisconsin. And it is unlikely that he will be able to win the...

    5
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    Positioning Ahead Of The G20

    Over the summer, the US administration’s aggressive trade stance towards China helped trigger sell-offs in most non-US equity markets, even as the US market continued to make new highs. But, in the past six weeks, the massive outperformance of US equities has stalled. Louis asks where it makes sense for investors to hide until the outcome of the G20 meeting is clear.

    1
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Failure Of The Bond Cushion

    If you had been told on September 20, when the US stock market made its high, that two months later the MSCI US would be entering correction territory, down almost -10%, and that oil would be in a full-blown bear market, with Brent down almost -30%, you would probably have concluded that long-dated US bonds would be the place to be. The US dollar delivered; the DXY is up 2.7%. But long bonds did not; over the two-month period, the TLT ETF has...

    4
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Uphill Struggle For Equities

    Last week saw the MSCI World turn in its sixth negative week in eight, while the only sector to record gains over the last two months has been utilities; cyclical sectors like materials, industrials, IT, energy and consumer discretionary have mostly entered correction territory. That begs the question: Is this a dip to buy, or will the environment remain harsh?

    5
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Odd Behavior Of Gold

    Barbarous relic it may be, but I have long looked on gold as a proxy for emerging markets. The logic is that when the emerging market consumer—whether in India, China, Indonesia, Africa or the Middle East—finds himself at the end of the month with extra money in his pocket, he often tends to put that money into gold coins or jewelry. This makes sense if you live in a country with capital controls, or an untrustworthy financial system, under-...

    0
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Consequences Of Khashoggi

    In 1939, Franklin Roosevelt famously dismissed reservations about Nicaragua’s brutal dictator Anastazio Somoza with the comment “he may be a sonofabitch, but he’s our sonofabitch.” In the world of foreign policy realpolitik, to a large degree FDR’s doctrine still holds true. Witness, for example, the verbal contortions that US president Donald Trump and secretary of state Mike Pompeo have been forced to pull off in recent days in order to...

    6
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    Bonds' Failure To Rally

    Given all the bad news for markets this year, one would be forgiven for thinking that US treasuries and German bunds would have been a good investment. But even as emerging markets have sold off and the US dollar has risen against almost every emerging market currency out there, US treasuries (and to a lesser extent bunds) have been an absolute dog of an investment.

    4
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    Does Beijing Really Manage The RMB Against A Basket?

    Possibly the only easy thing about studying China is that Chinese policymakers tend to “say what they do and do what they say”. Take the Chinese exchange rate as an example. From 1998 to 2005, the renminbi’s exchange rate was fixed at CNY8.28 to the US dollar. Then, in 2005, investors were told that the renminbi would be allowed to appreciate gradually and with a controlled daily volatility. When the financial crisis hit, the Chinese exchange...

    4
  • Please login, request a trial or contact our sales team for more information

    Gavekal Research

    The Dissolution Of Chimerica

    The economies of the US and China are by far the world’s largest. Such has been their importance and dependence that the composite phrase “Chimerica” emerged to describe both the integration of supply chains and corporate profitability as well as cultural connections. Today, the single most important question may be: is the foundation on which this Chimerica pillar rested now crumbling?

    0
Show me: results