Part One We have had a very negative view of US equities relative to European and Emerging Market (EM) equities since long before covid19 became a factor. Our reasoning has been simple. In the shorter-term valuations are a poor predictor of future returns but over the...
We’ve seen an unprecedented panic in global equities in a short space of time. This crisis has been very different from other crises in that it is a health crisis and not a financially driven one as we saw in 2008. The big difference between this one and 2008 is that the banking system is more...
I’ve been in the business for 27 years now. Before the current crisis I thought I had seen it all, but this time is different compared to the Russian currency crisis, the Asian Contagion, the Tech Wreck or the Global Financial Crisis of 2008. This...
US companies have by far been the most aggressive borrowers during the last decade. Low interest rates have allowed big US corporates to borrow cheaply (via corporate bond issuance). In a vast majority of cases they took the proceeds of that corporate bond issuance and...
It has only been a week since our last update but so much has happened since then. We have seen the type of market behaviour that pretty much always results in extraordinary long term buying opportunities for stocks and other types of risk assets such...
Firstly a quick recap of 2019. Two stories dominated; the US-China Trade War and Brexit. Interestingly neither had a negative effect on markets. Stocks were up strongly and the dollar and sterling both appreciated over the year. The year to date stock appreciation numbers are...
Depositors and investors will by now realize that the zero interest rate policy being pursued by the ECB is having a disastrous effect on pensions, savings, and investments. In his final meeting as head of the ECB Mario Draghi cut rates further and re-launched the...
Stock markets have enjoyed substantial gains this decade and up until September last year the rally looked set to continue. What upset the equity market was the downgraded outlook for global growth and a US ten year bond rate in excess of 3%, which acted...
Written by Peter Brown & David Flynn of Baggot Investment Partners. Here is the bad news first. Interest rates are not coming back for a long time. In fact, they are going to go lower first. Trump and his tariffs are causing a global slowdown and that...
Irish Examiner,2 Apr 2018,Peter Brown ■ Peter Brown is a founder of Baggot Investment Partners. There are only two fears in this market and they are the risk of inflation and the vagaries of US President Donald Trump. It was an inflation reading in late January that...