“Once upon a time, Western opinion leaders found themselves both impressed and frightened by the extraordinary growth rates achieved by a set of Eastern economies. Although those economies were still substantially poorer and smaller than those of the West, the speed with which they had transformed themselves from peasant societies into industrial powerhouses, their continuing ability to achiev…Read the article
Having seen one of my favourite economists, Professor Michael Pettis, present twice in the past couple of months, I thought I’d try to distil his important messages about the future of the Chinese economy. For those with more time, he also writes a blog which you can find here. The recent presentations aside, I first saw Professor Pettis at a breakout session during the World Bank-IMF meeting i…Read the article
2013 was another decent year for returns in the high yield market. The US market returned 7.4%, with Europe a little way ahead at 10.3%. Bonds saw solid income returns, low default rates and a small capital gain as a tightening in credit spreads was enough to overcome weakness in the government bond markets. Once again this illustrated how high yield can be one of the few fixed income asset cla…Read the article
Benjamin Franklin said that death and taxes were the only inevitabilities in life. I’d like to add the discussion of the January effect to his list. Every year I receive at least one piece of commentary telling me that January is always a good month for risk assets (we’re far from innocent ourselves – see here).
Basing investment decisions purely on seasonal anomalies isn’t a particularly relia…Read the article
Many of us have become accustomed to a world of ultra-low interest rates and quantitative easing (QE). Taking into account inflation, real short-term interest rates are negative in most of the developed world. Of course, these historically low interest rates were a central bank response –co-ordinated on some occasions – to the Great Financial Crisis of 2008. Whilst we are still waiting for the …Read the article
Emerging market (EM) fixed income posted its third negative performance year since 1998, driven by rising US Treasury yields, fears of tapering, and concerns around declining capital inflows from developed markets into emerging markets. A number of EM countries were also hindered by country-specific drivers such as slowing growth, decreasing productivity, twin deficits, and exposure to a slowi…Read the article
Thanks for all the entries to the 2013 quiz. The winner is Adam Weidner who gets to choose where we send a £200 charity donation, and a copy of Morrissey’s autobiography. We’ll be in touch, and tweet the charity name on @bondvigilantes. The five runners up who win a Moz book are Jonathan Moore, Mark Nelson, Adrian Coates, Joshua Giersch and Richard Milne. Have a great 2014.
1. “The band the Bea…Read the article