During the last three months inflation has become a much debated topic. This article, which was published in March, may still add something to the increasingly heated debate: – Inflationary Inflection Point or Temporary Blip? Inflationary Inflection Point or Temporary Blip ..read more

Macro Letter – No 139 – 18-06-2021 Commodities, Supply-chains and Structural Changes in Demand Talk of a new commodity super-cycle may be premature Once GDP growth returns to trend, commodity demand will moderate Fiscal and monetary relief are key to maintaining growth and demand Structural changes in energy demand will prove more persistent As the spectre of inflation begins to haunt economists, many market commentators have started to focus on commodity prices in an attempt to predict the likely direction of the general price level for goods and services. This indexing of the most heterog ..read more

Macro Letter – No 138 – 21-05-2021 First In, First Out – China as a Leading Indicator China was the first country to recover from the Covid-19 pandemic The PBoC began tightening monetary conditions in May 2020 Chinese housing and stocks remain strong despite official policy Chinese contagion remains a risk to the global recovery Whilst there are many aspects of the Chinese command economy which differ radically from that of the US, it is worth examining the performance of China’s economy, fiscal and monetary policy, and its financial markets. They may afford some insight into the future ..read more

I published this essay at the end of last year but as Cryptocurrencies and Digital Asset gain further prominence, I take the liberty of sharing once more. Central Bank Digital Currencies will be the next ‘innovation’ but we may see money, traditionally a store of value and a means of exchange, become either one or the other. Digital Currencies and US Dollar Dominance ..read more

With a new administration installed in the US and a $1.9trln relief package approved, attention has now turned to how this fiscal largesse will be paid for. I thought this article from September 2020 might add to the debate. Debt or Taxes ..read more

Macro Letter – No 137 A Review of Stock Market Valuations – Part 2 As global stock markets continue to rise, commentators talk of a bubble Shorter-term indicators suggest the markets have run ahead of fundamentals Expectations about the speed of economic recovery from the pandemic remain key Even a slight moderation of fiscal and monetary expansion could precipitate a crash Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one. Charles Mackay – Extraordinary Popular Delusions and the Madness of Cr ..read more

Source: Peter Boockvar, Pinnacle Data, Haver Analytics, Citi Macro Letter – No 136 – 19-02-2021 A Review of Stock Market Valuations – Part 1 As global stock markets continue to rise, commentators talk of a bubble Longer-term indicators present mixed signals about valuation Expectations about the speed of economic recovery from the pandemic are key A recovery in productivity growth relies on saving and investment in innovation This is the first of a two part letter reviewing the current valuation of stocks. The focus is US-centric and will investigate both long-run valuation (Part 1) and s ..read more

Podcast with Max Gottlich – 22-01-2021 A 30 minute podcast interview covering stocks, crypto assets and thoughts about monetary and fiscal policy for the year ahead ..read more

With another $1.9trln of US fiscal relief set to be voted through, attention is likely to switch back to Europe. This article from August 2020 seems relevant to the debate. The Fiscal Centralization of Europe Will Not End Well ..read more

Macro Letter – No 135 – 31-12-2020 US Stocks in 2020 and the prospects for 2021 2020 has been a torrid year for stock markets globally Fiscal and monetary stimulus rescued investors from a brutal bear-market Digital transformation has accelerated and fortunes of the technology sector with it With mass-vaccination still some way off, 2021 will see many trends continue The US stock market is making all-time highs (as at 29th December). It has been a torrid year. The 35% shakeout in the S&P 500, seen in March, turned out to be the best buying opportunity in several years. The market recove ..read more