Oct 23, 2017 | US Economy
In August, we had reviewed a few charts showing that US high yield valuations were divorced from fundamentals, as well as to other yield products. This week, refreshing those charts, we can see that things are just as bad. US high yield seems to be the most vulnerable...
Aug 5, 2017 | Emerging Markets, Global Economy
The macro-economic landscape has profoundly changed since the financial crisis. Developed markets deleveraged, and emerging markets became the engine of global credit and money growth. The top-left chart from the BIS shows this very clearly. EMEs (emerging market...
Nov 12, 2016 | US Economy
(from our Tactical report of 1st November 2016) Equity volatility and credit spreads are almost perfectly correlated. In part this is because equity is a perpetual option on the solvency of a firm. When credit becomes stressed, equity volatility jumps as well. You can...
Mar 18, 2016 | US Economy
You can take a horse to water, but you can’t make it drink. This is generally the mistake made by many when it comes to credit. If you expand the availability of credit, and make it more attractive, then more people will want credit. But this is rarely the case. ...
Dec 5, 2014 | Monetary Policy, UK
Easy monetary policy in the UK is looking ever more inappropriate. Divisia money is a weighted money-supply measure. Higher forms of money, eg notes and coins have greater weights than less liquid forms of money, such as building society deposits. Thus Divisia...
