Quantitative easing (QE) is the process by which central banks inject money directly into the financial system, usually through the purchase of government bonds using printed or electronically created money. This is intended to stimulate economic activity. Show More
There was much fanfare on the 22nd May 1994 when millionaire Japanese dentist Akihiro Kabe and co-driver Takeshi Okano approached the start of Australia’s inaugural Cannonball run in a $750,000 Ferrari F40. At the time the most expensive new Ferrari in the world, it was about to tackle Darwin to... Show More
Bonds are typically viewed as a defensive component of an investor's portfolio. They tend to perform best when your riskier assets are doing poorly. Stuart Dear, Deputy Head of Fixed Income at Schroders says the analysis they've conducted shows this relationship has held true in all but one circumstance over... Show More
In an age where political correctness runs rampant, we are all having to be exceedingly conscious about how the things we say and words we use affect others. This is undoubtedly a good thing, but have we gone too far when our elected representatives are muzzled to stand up and... Show More
Speaking at a news conference after the Federal Open Market Committee meeting, US Federal Reserve Chairwoman Janet Yellen stated that ‘helicopter money’ could be considered under certain conditions. In Japan, with currency intervention effectively off the table for fear of accusations of being a currency manipulator, there is increasing speculation... Show More
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Morgan Stanley's Global Economist Manoj Pradhan has warned there is a chance that the US, Europe and Japan will all commence tightening at the same time next year, should there be a substantial pickup in growth and inflation. Pradhan says "What is unknown is whether the economic situation will pan... Show More
Nick Gartside, the CIO of Fixed Income at JP Morgan Asset Management says the latest bond sell off is a “correction, not a reversal.” “We had a trade where the ECB was seen as being behind the market. We had a concern over deflation or very low inflation. And what... Show More
"Since 2008, high yield debt has gone from $300 billion to $900 billion. This is but one side effect of QE which has forced sovereign bond yields into negative real territory and sent yield hungry investors into the high yield market. While investors, mutual funds in particular, have been scrambling... Show More
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The key for investors moving forward is not the timing of the first hike, but it is the pace and nature of the tightening cycle that matters most and I still think the US economy is well below trend and therefore the Fed will be slow, late, extremely cautious and... Show More
The VIX heading to single digits, low interest rates/ financing costs and QE infinity inflating asset prices around the world, mean that buying out of the money call options on almost any asset and putting the feet up is now the trade de jour! Show More