12 Years of VP vs Noise
Sharing the ideas and experiences that have influenced our work
The strength of sterling has been in part due to some safe-haven flows from the Middle East (where sometimes GBP is seen as a preferable safe-haven to the USD or CHF), but this is not the fundamental driver.
Variant Perception had one guest host appearance on the CNBC today. Head of Research Claus Vistesen talked about the ECB's rate decision and what it is likely to do in the face of a weakening global economy. We should of course point out that although the Riksbank in...
Variant Perception will have one guest host appearance tomorrow (Thursday May the 3rd) on CNBC. Head of Research Claus Vistesen will be appearing 11.00 GMT to speak about the ECB's rate decision.
Fiscal austerity in the developed world represents a paradox. On one hand, it is necessary as governments had already borrowed too much going into the crisis and can thus no longer continue to lever up to compensate for private deleveraging. On the other hand, the objective of fiscal austerity is to stabilise exploding government debt to GDP ratios, but this is proving difficult as depressing government spending leads to a higher decline in GDP relative to the reduction in the gross debt level.
In our view, the Spanish banking system is in need of wholesale recapitalisation to deal with the sizeable losses in the country’s property market. This will likely include a bad bank provision. Before that happens, the ECB’s open market operations will mainly buy time in the form of liquidity as well as provide banks with money to exchange bad loans for lending to the government.
Despite an historic low Bank of England base rate, the spread between the standard variable rate (SVR) for mortgages in the UK and the base rate widened significantly in the aftermath of the financial crisis, and has continued to trend higher.
Variant Perception had two guest host appearances on the CNBC yesterday. Chief Editor Jonathan Tepper was interviewed in relation to VP being shortlisted for the Wolfson Prize for its piece on how and why the euro might break up. Next up was Head of Research Claus...
We are pleased to announce that Variant Perception has been elected as a top 5 entrant for the Wolfson Economics Prize for our piece A Primer on the Euro. More details can be found at the Policy Exchange website as well as on the Guardian, the Telegraph, the Wall...