There are essentially two approaches to allocating assets in portfolios. One depends on a thorough macroeconomic and financial analysis to identify preferences for certain asset classes over others. Any such analysis can take quite varied forms technically and fundamentally, but it ultimately comes down to making decisions on the basis of forecasts. The second approach […]
Two exogenous shock-waves have struck markets in the past few weeks: the first, social and political, stemming from the democratic uprisings in North Africa and the Middle East; the second, seismic and nuclear, with the devastating earthquake and tsunami, and the crippled Fukushima nuclear plant in Japan. These events have unfolded against a still bright […]
In the opening months of 2011 fast-moving events have reshaped the three dimensions – economic, financial and geopolitical – that frame the investment universe. Moreover, their complexity has amplified the sheer intensity of these developments. These events have raised four crucial threats to the recovery scenario which has been confirmed by several strengthening underlying trends […]
Macroeconomic analysis demands that a large quantity of statistics, often of questionable quality, be collated and processed.Therefore economists often resort to approximations in order to detect trends amid the fog of numbers, the primary sources being series of aggregated data.This approach leads to the conclusion that US households are over-indebted; but what would the picture […]
2010 has been quite an eventful year for investors – stock markets have been highly volatile and the economic landscape has been rocked by serious tremors, such as the crisis in Greece. Of course, in the circumstances, it would be comforting to able to inform investors and clients that we are about to witness a […]
Twelve months ago, we reviewed the major trends we thought likely to influence the global economy and financial markets in the next decade. One year on, it is time to reassess the situation. Pictet’s Strategy Committee met in mid-October to analyse and update our view of the structural framework for investment decisions in the coming […]
The rally in risky assets in September took us by surprise, since our basic macroeconomic scenario has been quite correct. Developed economies, led by the United States, have indeed slowed significantly in recent months. According to our route map, such a slowdown would lead to a new policy mix, including a second round of quantitative […]
The government in Berlin is perfectly at ease with its rigorous deficit-reduction programme, since it regards the austerity medicine as good for growth. Germany’s Finance Minister,Wolfgang Schäuble, brimming with enthusiasm for the virtues of fiscal austerity, even offered his services to his US counterpart,Treasury SecretaryTimothy Geithner, to explain the wisdom of following what he referred […]
Although the sovereign-debt crisis sent the price of the 2040 Hellenic Republic bond below the 50% mark, or under its level before the eurozone’s EUR750bn bailout package, it has barely impinged on US or Japanese government debt securities. At the time of writing, 10-year Japanese government bonds are yielding 1.10%, while benchmark 10-year US Treasuries […]
Financial analysts, pundits and commentators have long warned of the likelihood ofWestern governments running into serious budget deficit problems by 2020, chiefly as a result of the rapidly ageing populations in this part of the world.The financial crisis that flared up in 2008 has only hastened the beginning of serious budget financing problems. 2010 is […]
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