Until now, financial markets have adopted a complacent "wait and see" approach when considering the prospects for the Trump 2.0 trade policy. However, the hope the new Administration's bark would be worse than its bite has been dashed with the imposition of high tariffs on the nation's three largest trading partners. Markets should now contemplate [...]
Tag: inflation
Bond Yields Rising: Don’t Be Confused
24 January 2025 Remarkably, even though the US Federal Reserve has lowered the Fed funds rate by 100bp since last September, US bond yields have risen sharply (roughly 100bp). Market commentators have offered a wide range of explanations for this unusual development. As the incoming Administration has signalled a significant shift in economic strategy, investors [...]
Strategy 2025: Pivoting from Trump 2.0 Trades?
12 December 2024 In my Strategy 2024 blog entitled "Powell Pivot: What Could Go Wrong or Right?", I suggested global financial markets had entered a cyclical sweet spot. Specifically, the combination of steady (if uneven) global growth, declining inflation, and easing monetary conditions pointed to higher equity market valuations. Indeed, even my bullish S&P 500 [...]
Election 2024 Edition #4: It’s the Economy…..
28 October 2024 The US Presidential election is in nearly here, at last. In recent weeks, we have discussed key topics receiving insufficient attention during the bruising campaign: looming fiscal crises, international trade policy, and climate change. In 1992, James Carville famously reminded us the economy is usually the most important determinant of American election [...]