US Inflation looks to have been beaten, but that might not mean very much if the global economy is still headed into recession. Rates and consumption are a lagging problem for the markets, and there is a chance even strong economies will stall.
Lots going on out there – but what does it all mean? Markets have plenty to consider from rates, inflation, micro, macro, geopolitics and climate – but the core objective remains: generating dull, boring predictable returns in difficult markets.
Stock buybacks are a contentious issue – there are times they are the right thing to do, and make sense. Often they do not. The trick is to align them with shareholder value and stakeholders and be aware of the consequences. They should not just be about the stock price!
Many think Markets are set fair for the second half of 2023 – but what if a mighty depression is brewing out there in the ocean of corporate debt? I am looking at the glass (barometer for the non-nautical) falling and at the CLO market in particular. There may be a storm brewing.
Markets have been far more positive than expected in 2023 – thus far. There is still much uncertainty out there, but what is the market missing? I have two particular under-played threats to watch – corporate debt and social unrest.
Let’s assume the US Debt crisis is averted. What comes next? A full-on speculative bubble and hype around Artificial Intelligence is underway. How will AI influence trading strategies, or turn markets into gray-goo? Will AI trading prove to be little more than finding new innovative ways to relieve retail investors of their money?
Yesterday’s UK inflation numbers hint the Bank doesn’t understand the modern drivers of inflation or how to address them. It leaves some stark likely outcomes: stagflation or a Reflationary Death Scramble. Neither are good.
Markets are focused on the immediate debt-ceiling crisis, and the short-term game of guessing rates vs inflation. Down the line are the bigger challenges of the medium and long-term: issues we need to be investing in now to garner long-run returns or just to survive!
Aviation is booming. Airlines are buying planes. Passengers want to fly. There are just a few little problems... There aren’t enough planes. That makes Aircraft as an Alternative Asset a great investment opportunity.
The Market Commentariat think deflation will counter inflation, rates will fall, and recession will be limited. The world is more complex - supply side factors are more volatile. Stagflation is a more likely outcome than recession.
