One thing central banks fail to acknowledge is that their medicines are a kind of chemotherapy that, while attempting to eradicate a problem, often end up damaging everything else at the same time. QE in particular is one of those unconventional treatments that should always be used with parsimony because of its extreme side effects.…
When I woke up today I was shocked by the news that the BOJ had cut its benchmark rate to -0.1% overnight. At a time when the FED is fighting to normalise its policy and the ECB is entertaining investors to delay further QE, the BOJ decision comes as a major blow and a huge…
As seen in the January edition of Master Investor Magazine. We’re now at the beginning of the year: a time when investors, analysts, journalists, and politicians make a series of predictions for the year to come. Most of them will prove wrong, as the many interactions between all the variables involved make it impossible for…
The ECB has kept its key rates and asset purchasing programme unchanged while Mario Draghi promised investors there’s more to come in the near future. A dovish Draghi is keeping investors entertained while buying him some time to convince the other committee members to extend the current asset purchase programme. If he doesn’t deliver there…
The latest data published by Oxfam show a worrying increase in income inequality during just the last few years. Many believe this to be the consequence of the free market, and in response raise arguments in favour of policy intervention. I myself believe public intervention to be the cause, not the solution, as the global…
There are many sayings in the financial markets regarding calendar effects. Some say “sell in May and go away”; others say “as goes January, so goes the rest of the year”. Both sayings are based on persistent performance anomalies that were uncovered by traders and confirmed by researchers. Today I’m going to test another calendar…
“On a typical day, one billion people around the world eat chocolate” – in “A taste of the future”, KPMG June 2014 Financial news has recently been dominated by the epic crash that is haunting the oil market. What at first seemed like good news for consumers is now turning into a nightmare from which…
Last week, The Danmarks Nationalbank increased its deposit rate by 10 basis points in a move towards policy normalisation, particularly in regard to interest rate spreads against the ECB. In terms of the Danish economy, this move means almost nothing because short-term interest rates will continue to move within the negative interest rate policy (NIRP)…
2015 was a particularly tough year for British equities. At the beginning of the second quarter everything was gaining traction with the FTSE 100 index rising 8.5pc and recording a multi-year high at 7,122.74; but then things soured and the index was caught in a huge descent that stole 1,250 points from that level. With…
We are now celebrating the third year of Abenomics in Japan. After being in a dormant state for more than twenty years, the Japanese economy was in need of someone that could revitalise it through shock and awe. Shinzo Abe promised what others didn’t and quickly ascended as Prime Minister to unfold a three arrow…
