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.
Yesterday’s ongoing pain in crashing financial asset markets demonstrates the need to diversify portfolios and decorrelated returns. Shipping is one such asset; returns have been boosted by scarcity as a result of the pandemic – the question is: can these returns be maintained?
There are plenty of positive news stories emerging as the global economy reopens, but also an increasing number of real-world tangible threats emerging. The Pandemic has affected economies from top to bottom, and many issues won’t be resolved overnight. For markets the issues to consider aren’t just inflation or market bubbles, but how supply chain issues and instability could continue to impact sentiment.