CELTICGOLD is based on the Isle of Man but provides buying and selling services for over 90 countries worldwide.Celticgold is one of very few bullion companies in the world that next to best prices and a fast and secure service provides knowledge for you to become a gold-insider.
With Halloween right around the corner, it's the time of year to analyse what is safe and what is scary in investment markets.
And, the scariest investments in the world will become a complete surprise to many.
In this IceCap Global Outlook we detail what to be afraid of and why, and better yet - where you should hide.
The document provides an outlook on global markets from Henley for July 2013. It discusses developments in various asset classes including equities, currencies, fixed income, and property. For equities, it analyzes regions including the US, Japan, UK, Europe, Australia, ASEAN, China, India, and other emerging markets. It also covers commodities, alternative investments, and risks related to potential bank bail-ins. The author advises taking precautions with bank deposits given new laws allowing for deposit haircuts and the insolvency of many financial institutions masked by fraudulent accounting.
The recent American election continues to have the world on edge. Seemingly every media outlet and investment manager around the world continues to hammer away at the bad or good that will be created by the actions of the new President.
This is a mistake.
While the entire world continues to be focused on President Trump and American Politics, it has become completely distracted as to what is happening in Europe.
Europe remains a pile of timber and in this issue of the IceCap Global Outlook, we describe how dramatic swings in politics and interest rates will be the spark that reignites the crisis in the old world.
The reason the world's economic slump continues is quite clear - people are spending less money than before.
The solution used by the world's central banks is to reduce the amount of money available to people to spend.
Irony or confusion? Take a pick. One thing is clear - investors are doing unusual things with their money, and unfortunately they are paying the price.
Years ago, the seeds were sown.
Governments began an untenable trend of consistently spending more money than they collected in taxes. The difference of course, was made up by borrowing. As the years and deficits rolled along, so too did the amount of money owing. Governments responded by borrowing even more.
Meanwhile, global economies inevitably experienced varying crises. Governments and central banks always responded the same way - even more spending (and borrowing), and lower interest rates to stimulate growth.
Today, we've reached a dead-end.
Governments continue to borrow, but only because interest rates have been reduced to 0% AND because they are borrowing from themselves by printing money.
This dead-end is also compounded by a slowing global economy caused by the reluctance of private investors to spend.
In this issue of the IceCap Global Outlook, we prepare investors for a collision between:
a slowing economy,
0% and negative% interest rates,
an unsustainable debt binge.
What happens next hasn't occurred before in our lifetime - and this is why many investors will be blindsided.
The document discusses how central banks around the world have gone without sleep for thousands of nights due to selling off their gold reserves at low prices. Specifically, the Bank of England sold gold at an average of $270/ounce, the Swiss National Bank sold over 1300 tonnes of gold between 2000-2005, and the Bank of Canada has no gold reserves remaining after selling theirs. Now with gold prices much higher, these decisions are causing sleepless nights. Additionally, the document discusses inflation occurring in asset prices like stocks due to money printing, and how this is playing out in troubled European economies.
CELTICGOLD is based on the Isle of Man but provides buying and selling services for over 90 countries worldwide.Celticgold is one of very few bullion companies in the world that next to best prices and a fast and secure service provides knowledge for you to become a gold-insider.
With Halloween right around the corner, it's the time of year to analyse what is safe and what is scary in investment markets.
And, the scariest investments in the world will become a complete surprise to many.
In this IceCap Global Outlook we detail what to be afraid of and why, and better yet - where you should hide.
The document provides an outlook on global markets from Henley for July 2013. It discusses developments in various asset classes including equities, currencies, fixed income, and property. For equities, it analyzes regions including the US, Japan, UK, Europe, Australia, ASEAN, China, India, and other emerging markets. It also covers commodities, alternative investments, and risks related to potential bank bail-ins. The author advises taking precautions with bank deposits given new laws allowing for deposit haircuts and the insolvency of many financial institutions masked by fraudulent accounting.
The recent American election continues to have the world on edge. Seemingly every media outlet and investment manager around the world continues to hammer away at the bad or good that will be created by the actions of the new President.
This is a mistake.
While the entire world continues to be focused on President Trump and American Politics, it has become completely distracted as to what is happening in Europe.
Europe remains a pile of timber and in this issue of the IceCap Global Outlook, we describe how dramatic swings in politics and interest rates will be the spark that reignites the crisis in the old world.
The reason the world's economic slump continues is quite clear - people are spending less money than before.
The solution used by the world's central banks is to reduce the amount of money available to people to spend.
Irony or confusion? Take a pick. One thing is clear - investors are doing unusual things with their money, and unfortunately they are paying the price.
Years ago, the seeds were sown.
Governments began an untenable trend of consistently spending more money than they collected in taxes. The difference of course, was made up by borrowing. As the years and deficits rolled along, so too did the amount of money owing. Governments responded by borrowing even more.
Meanwhile, global economies inevitably experienced varying crises. Governments and central banks always responded the same way - even more spending (and borrowing), and lower interest rates to stimulate growth.
Today, we've reached a dead-end.
Governments continue to borrow, but only because interest rates have been reduced to 0% AND because they are borrowing from themselves by printing money.
This dead-end is also compounded by a slowing global economy caused by the reluctance of private investors to spend.
In this issue of the IceCap Global Outlook, we prepare investors for a collision between:
a slowing economy,
0% and negative% interest rates,
an unsustainable debt binge.
What happens next hasn't occurred before in our lifetime - and this is why many investors will be blindsided.
The document discusses how central banks around the world have gone without sleep for thousands of nights due to selling off their gold reserves at low prices. Specifically, the Bank of England sold gold at an average of $270/ounce, the Swiss National Bank sold over 1300 tonnes of gold between 2000-2005, and the Bank of Canada has no gold reserves remaining after selling theirs. Now with gold prices much higher, these decisions are causing sleepless nights. Additionally, the document discusses inflation occurring in asset prices like stocks due to money printing, and how this is playing out in troubled European economies.
With Halloween right around the corner, it's the time of year to analyse what is safe and what is scary in investment markets.
And, the scariest investments in the world will become a complete surprise to many.
In this IceCap Global Outlook we detail what to be afraid of and why, and better yet - where you should hide.
This document contains an editorial and several news articles from The Gold Standard Institute's journal.
The editorial discusses recent economic troubles in countries like Cyprus and Greece, and increasing money printing by central banks. It argues this unsustainable path will inevitably lead countries toward adopting an honest gold standard. One news article analyzes how a gold standard benefits average citizens more than the rich, by allowing interest rates to be set freely. Another reviews different definitions and analyses of the concept of "freegold."
When it comes to sleepless nights, Toimi Soini of Finland originally set the record by using the “toothpicks under the eyelids” method for 11 straight days. In hindsight, Toimi was an amateur.
You wouldn’t know it, but the nice people running the Bank of Canada have gone sleepless since 2003 – that’s 3,564 days without sweet dreams.
Yet, that’s nothing compared to the very private folks at the Swiss National Bank. These super-secretive bankers have surpassed over 4,660 sleepless nights – despite living in Zzzzzzurich.
This, of course brings us to the World record for sleepless nights. At 5,025 nights and counting, the always polite and well dressed chaps over at the Bank of England are reigning champions.
Toimi Soini was not a banker and this was his downfall. As for the Canadians, Swiss and British – yes they are all bankers, but not just any bankers. This terrific trio have the displeasure of forever being known as the bankers who sold their gold.
The irony of course, is the action of the World’s central bankers themselves is the reason why gold is destined to remain golden for sometime to come. And with gold sitting near $1700/oz, and with no end to the money printing games, the sleepless nights are destined to continue.
1. The document provides an introduction to investing in gold and silver, noting that while a disclaimer is included, the purpose is to educate readers on key strategies and information.
2. It discusses the current state of the US economy, including unprecedented levels of debt that have raised concerns about inflation and the stability of the dollar. This context suggests gold and silver are wise hedge investments.
3. There are many investment options in gold and silver, but the document focuses on physical bullion coins and bars as the best investments, noting concerns about ETFs and numismatic coins in difficult economic times.
This document summarizes an investment outlook letter written by Bill Gross of PIMCO. The letter discusses how central banks and governments use "haircuts" as a hidden way to reduce debt levels and transfer wealth. It identifies four main types of haircuts: (1) negative real interest rates, (2) inflation/currency devaluation, (3) capital controls, and (4) outright default. While assets may appear to be "money good," the letter argues they are not truly "good money" due to these haircuts reducing purchasing power over time. It recommends gradually reducing risk in portfolios in 2013 to avoid excessive haircuts.
Wealthy & Wise, a wealth insight magazine started by SAKSHAM WEALTH Solutions Private Limited. under guidance of Mr. Sameer Rastogi.
The magazine covers latest trends and opportunities in all asset classes.
Some of the Topics Covered
1. Inflation: A Retirement Chewing Monster
2. Bitcoin: Honeymoon phase seems to be over for now
3. Rural Opportunities in India: A discussion with Krishna Kumar, CIO - Sundaram MF and fund manager for Sundaram Rural India Fund
4. Mistakes to be avoided in the current market rally.
5. Budget 2018 review by Sanjay Sapre, President - Franklin Templeton India
6. Real Estate recovery insight
7. How Rich People Think - A book review
8. Macro economic indicators... and more
The Henley Group's Market Outlook - May 2013Tania Scott
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, and commodities. For equities, it provides a positive assessment of Japan due to new stimulus measures weakening the Yen but remains negative on the US due to large national debt and lack of political will to address long-term fiscal issues. It also remains neutral on Japan, expecting more stimulus and monetary easing to revive the economy under a new Prime Minister and central bank Governor. The outlook expresses a negative view on fixed income given low yields compared to potential future inflation, but sees some opportunities in emerging market bonds in the short-term. Property prices are seen
The Henley Group's Market Outlook - May 2013Nicola Arnold
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, and commodities. For equities, it provides perspectives on the US, Japan, UK, Europe, Australia, ASEAN, China, India, and other emerging markets. It notes that central bank actions have inflated asset prices temporarily but that the large US national debt poses long-term sustainability issues. For Japan, it expects more stimulus measures to weaken the Yen further. The outlook is mostly negative given continued risks from high debt levels and prospects for currency depreciation from monetary easing.
The henley group's market outlook may 13Gary Lansdown
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, commodities, and alternative investments. For equities, it provides views on the US, Japan, UK, Europe, Australia, ASEAN, China, India, and other emerging markets. Key points discussed include the weakening Japanese yen, volatility in Japanese government bonds, mixed signals in the US and European economies, and recovering housing markets in the US and UK. Overall it maintains a mostly negative outlook due to ongoing debt and economic challenges while also highlighting some positive signs in selected areas.
The document is a letter from Agcapita Partners discussing the history and failures of fiat currencies. It notes that the average life expectancy of fiat currencies is only 34 years and that 1 in 5 fail due to hyperinflation. It argues that fiat currencies are useful for politicians and banks as they allow hidden taxation and wealth misappropriation. The letter predicts that current expansive monetary policies will fuel more speculation and eventual currency crises.
The document discusses the evolution of money from bartering to the gold standard. It describes how the gold standard worked and its limitations, leading countries to print more money than their gold reserves during World Wars. This ended the gold standard. The post-war Bretton Woods system established rules for international monetary systems. However, "beggar thy neighbor" policies of devaluing currencies to boost exports led to currency wars and a decline in international trade.
- The document discusses gold miners and whether investors should stick with their initial bullish view ("door") or switch views based on technical and fundamental signals. It argues the signals suggest switching to a more bearish view.
- It notes gold stocks have recently declined despite gains in gold prices, mirroring previous bear market signals. This suggests gold stocks will continue weakening significantly in the coming weeks.
- Junior gold miners are expected to decline the most as some investor interest has shifted to cryptocurrencies, worsening underperformance relative to senior gold miners if stock markets decline.
A Note on Cryptocurrency Stabilisation: Seigniorage Sharesrmsams
This document proposes a solution to stabilize cryptocurrency prices by implementing an elastic coin supply rule. Under this rule, coin supply would be adjusted proportionately to changes in coin market value to counteract price fluctuations from changes in demand. There are two difficult problems to solve to implement such a scheme: 1) how to represent the coin price inside the network with minimal trust, and 2) how new coin is distributed when supply is adjusted. The document then outlines a proposed solution to the second problem of distribution through a system of "seigniorage shares".
This document is a chapter from a book titled "The Gold Wars" that discusses the concept of leverage as it relates to gold. It describes how gold provides leverage both in terms of influence and financially. Gold's price rising provides leverage by increasing the value of one's gold holdings by more than the percentage increase in price. The chapter also discusses how gold mining stocks provided leverage in the past when gold prices rose since their profits increased at a higher rate than the price of gold. The author aims to educate readers on these leverage concepts and views the audience as a remnant interested in these ideas.
The document is an advertisement for Northwestern Mutual permanent life insurance. It notes that while markets are unpredictable, permanent life insurance from Northwestern Mutual provides long-term predictable growth through cash values that are guaranteed to increase over time. It highlights that Northwestern Mutual has paid out over $60 billion in dividends in the last 20 years and describes their permanent life insurance as a foundation for life.
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, and commodities. For equities, it provides views on specific regions including the US, Japan, UK, Europe, Australia, ASEAN, China, and other emerging markets. It notes recent price movements and economic indicators. For most areas it expresses a negative or cautious outlook given ongoing challenges and risks in the global economy.
Cara membuat blog di Blogger meliputi 4 tahap: 1) buka situs blogger.com dan buat akun Google jika belum memilikinya, 2) konfirmasi profil Google atau Blogger, 3) buat blog baru, 4) buat entri pertama dengan menambahkan judul dan isi menggunakan editor.
General guide to the hong kong medical system - The Henley GroupRichard Lewis
Should you have any concerns about whether
the level of cover you already have in place is
adequate, please email RL@TheHenleyGroup.com.hk, to discuss the most appropriate private medical insurance
plan for your particular needs and circumstances.
With Halloween right around the corner, it's the time of year to analyse what is safe and what is scary in investment markets.
And, the scariest investments in the world will become a complete surprise to many.
In this IceCap Global Outlook we detail what to be afraid of and why, and better yet - where you should hide.
This document contains an editorial and several news articles from The Gold Standard Institute's journal.
The editorial discusses recent economic troubles in countries like Cyprus and Greece, and increasing money printing by central banks. It argues this unsustainable path will inevitably lead countries toward adopting an honest gold standard. One news article analyzes how a gold standard benefits average citizens more than the rich, by allowing interest rates to be set freely. Another reviews different definitions and analyses of the concept of "freegold."
When it comes to sleepless nights, Toimi Soini of Finland originally set the record by using the “toothpicks under the eyelids” method for 11 straight days. In hindsight, Toimi was an amateur.
You wouldn’t know it, but the nice people running the Bank of Canada have gone sleepless since 2003 – that’s 3,564 days without sweet dreams.
Yet, that’s nothing compared to the very private folks at the Swiss National Bank. These super-secretive bankers have surpassed over 4,660 sleepless nights – despite living in Zzzzzzurich.
This, of course brings us to the World record for sleepless nights. At 5,025 nights and counting, the always polite and well dressed chaps over at the Bank of England are reigning champions.
Toimi Soini was not a banker and this was his downfall. As for the Canadians, Swiss and British – yes they are all bankers, but not just any bankers. This terrific trio have the displeasure of forever being known as the bankers who sold their gold.
The irony of course, is the action of the World’s central bankers themselves is the reason why gold is destined to remain golden for sometime to come. And with gold sitting near $1700/oz, and with no end to the money printing games, the sleepless nights are destined to continue.
1. The document provides an introduction to investing in gold and silver, noting that while a disclaimer is included, the purpose is to educate readers on key strategies and information.
2. It discusses the current state of the US economy, including unprecedented levels of debt that have raised concerns about inflation and the stability of the dollar. This context suggests gold and silver are wise hedge investments.
3. There are many investment options in gold and silver, but the document focuses on physical bullion coins and bars as the best investments, noting concerns about ETFs and numismatic coins in difficult economic times.
This document summarizes an investment outlook letter written by Bill Gross of PIMCO. The letter discusses how central banks and governments use "haircuts" as a hidden way to reduce debt levels and transfer wealth. It identifies four main types of haircuts: (1) negative real interest rates, (2) inflation/currency devaluation, (3) capital controls, and (4) outright default. While assets may appear to be "money good," the letter argues they are not truly "good money" due to these haircuts reducing purchasing power over time. It recommends gradually reducing risk in portfolios in 2013 to avoid excessive haircuts.
Wealthy & Wise, a wealth insight magazine started by SAKSHAM WEALTH Solutions Private Limited. under guidance of Mr. Sameer Rastogi.
The magazine covers latest trends and opportunities in all asset classes.
Some of the Topics Covered
1. Inflation: A Retirement Chewing Monster
2. Bitcoin: Honeymoon phase seems to be over for now
3. Rural Opportunities in India: A discussion with Krishna Kumar, CIO - Sundaram MF and fund manager for Sundaram Rural India Fund
4. Mistakes to be avoided in the current market rally.
5. Budget 2018 review by Sanjay Sapre, President - Franklin Templeton India
6. Real Estate recovery insight
7. How Rich People Think - A book review
8. Macro economic indicators... and more
The Henley Group's Market Outlook - May 2013Tania Scott
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, and commodities. For equities, it provides a positive assessment of Japan due to new stimulus measures weakening the Yen but remains negative on the US due to large national debt and lack of political will to address long-term fiscal issues. It also remains neutral on Japan, expecting more stimulus and monetary easing to revive the economy under a new Prime Minister and central bank Governor. The outlook expresses a negative view on fixed income given low yields compared to potential future inflation, but sees some opportunities in emerging market bonds in the short-term. Property prices are seen
The Henley Group's Market Outlook - May 2013Nicola Arnold
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, and commodities. For equities, it provides perspectives on the US, Japan, UK, Europe, Australia, ASEAN, China, India, and other emerging markets. It notes that central bank actions have inflated asset prices temporarily but that the large US national debt poses long-term sustainability issues. For Japan, it expects more stimulus measures to weaken the Yen further. The outlook is mostly negative given continued risks from high debt levels and prospects for currency depreciation from monetary easing.
The henley group's market outlook may 13Gary Lansdown
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, commodities, and alternative investments. For equities, it provides views on the US, Japan, UK, Europe, Australia, ASEAN, China, India, and other emerging markets. Key points discussed include the weakening Japanese yen, volatility in Japanese government bonds, mixed signals in the US and European economies, and recovering housing markets in the US and UK. Overall it maintains a mostly negative outlook due to ongoing debt and economic challenges while also highlighting some positive signs in selected areas.
The document is a letter from Agcapita Partners discussing the history and failures of fiat currencies. It notes that the average life expectancy of fiat currencies is only 34 years and that 1 in 5 fail due to hyperinflation. It argues that fiat currencies are useful for politicians and banks as they allow hidden taxation and wealth misappropriation. The letter predicts that current expansive monetary policies will fuel more speculation and eventual currency crises.
The document discusses the evolution of money from bartering to the gold standard. It describes how the gold standard worked and its limitations, leading countries to print more money than their gold reserves during World Wars. This ended the gold standard. The post-war Bretton Woods system established rules for international monetary systems. However, "beggar thy neighbor" policies of devaluing currencies to boost exports led to currency wars and a decline in international trade.
- The document discusses gold miners and whether investors should stick with their initial bullish view ("door") or switch views based on technical and fundamental signals. It argues the signals suggest switching to a more bearish view.
- It notes gold stocks have recently declined despite gains in gold prices, mirroring previous bear market signals. This suggests gold stocks will continue weakening significantly in the coming weeks.
- Junior gold miners are expected to decline the most as some investor interest has shifted to cryptocurrencies, worsening underperformance relative to senior gold miners if stock markets decline.
A Note on Cryptocurrency Stabilisation: Seigniorage Sharesrmsams
This document proposes a solution to stabilize cryptocurrency prices by implementing an elastic coin supply rule. Under this rule, coin supply would be adjusted proportionately to changes in coin market value to counteract price fluctuations from changes in demand. There are two difficult problems to solve to implement such a scheme: 1) how to represent the coin price inside the network with minimal trust, and 2) how new coin is distributed when supply is adjusted. The document then outlines a proposed solution to the second problem of distribution through a system of "seigniorage shares".
This document is a chapter from a book titled "The Gold Wars" that discusses the concept of leverage as it relates to gold. It describes how gold provides leverage both in terms of influence and financially. Gold's price rising provides leverage by increasing the value of one's gold holdings by more than the percentage increase in price. The chapter also discusses how gold mining stocks provided leverage in the past when gold prices rose since their profits increased at a higher rate than the price of gold. The author aims to educate readers on these leverage concepts and views the audience as a remnant interested in these ideas.
The document is an advertisement for Northwestern Mutual permanent life insurance. It notes that while markets are unpredictable, permanent life insurance from Northwestern Mutual provides long-term predictable growth through cash values that are guaranteed to increase over time. It highlights that Northwestern Mutual has paid out over $60 billion in dividends in the last 20 years and describes their permanent life insurance as a foundation for life.
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, and commodities. For equities, it provides views on specific regions including the US, Japan, UK, Europe, Australia, ASEAN, China, and other emerging markets. It notes recent price movements and economic indicators. For most areas it expresses a negative or cautious outlook given ongoing challenges and risks in the global economy.
Cara membuat blog di Blogger meliputi 4 tahap: 1) buka situs blogger.com dan buat akun Google jika belum memilikinya, 2) konfirmasi profil Google atau Blogger, 3) buat blog baru, 4) buat entri pertama dengan menambahkan judul dan isi menggunakan editor.
General guide to the hong kong medical system - The Henley GroupRichard Lewis
Should you have any concerns about whether
the level of cover you already have in place is
adequate, please email RL@TheHenleyGroup.com.hk, to discuss the most appropriate private medical insurance
plan for your particular needs and circumstances.
Spune Stop Infectiilor Virale… Si Descopera 6 Produse Naturiste Pentru Intari...Calishop Partener Calivita
Pornind de la principiul ca ” prevenit inseamna pe jumatate pregatit “, 6 produse Calivita sunt esential sa se regaseasca in farmacia noastra de acasa pentru a ne intari sistemul imunitar si pentru a da o replica cat mai viguroasa din start impotriva infectiilor virale de sezon.
The document provides an outlook on global markets from Henley for May 2013. It discusses developments in various asset classes including equities, currencies, fixed income, property, and commodities. For equities, it provides a positive assessment of Japan due to new stimulus measures weakening the Yen but remains negative on the US due to large national debt and lack of political will to address long-term fiscal issues. It also remains neutral on Japan, expecting more stimulus and monetary easing to revive the economy under a new Prime Minister and central bank Governor. The outlook expresses a negative view on fixed income given low yields compared to potential future inflation, but sees some opportunities in emerging market bonds in the short-term. Property prices are seen
- The document provides an outlook on various asset classes and markets for February 2013 from Henley, a wealth management firm.
- It discusses the decoupling of markets and fundamentals due to money printing by developed nations, and sees a currency crisis as likely within the next couple years.
- In equities, it is positive in the short-term due to quantitative easing inflating prices, but negative on fundamentals. Real estate prices are stabilizing in select areas like Singapore, London, and signs of stability in the US, but further weakness is expected elsewhere. Fixed income carries inflation risk from monetary easing.
Louis Boulanger- Gold rises against fiat abuse 111114Symposium
Louis Boulanger presented at The Gold Symposium 2011 on the abuse of fiat currencies and how gold ownership offers protection. He summarized that all currencies are being debased to zero potentially, and that gold provides protection from ongoing fiat currency insanity and delusion until the end of the unsound monetary system. He argued that without currencies being redeemable for gold, today's monetary system relies entirely on confidence in governments and their ability to repay debt, which is not guaranteed and the system could collapse.
Everyone enjoys a nice surprise - especially the ones that cause you to grin ear to ear, smile non-stop and wish the moment will never end.
There can also be bad surprises - and these are not the least bit enjoyable.
In this issue of the IceCap Global Outlook, we explain how governments are about to experience a bad surprise. And their reaction to these surprises will be significantly higher taxes for everyone.
There will also be a good surprise - adjusting your portfolios in anticipation of the bad surprise will allow you to not only preserve your capital, but also have you grinning ear to ear.
We invite you to read more.
Gold & Economic Freedom In The New World Orderjohnfarthing
This document discusses the history of gold and silver as money, challenges with fiat currencies, and arguments for reconsidering the role of precious metals in portfolio management and the global financial system. It notes that for most of human history, currencies have been backed by or consisted of gold and silver. However, since 1971 currencies have been unbacked fiat currencies in a 40-year experiment. It raises concerns about the effects of money supply growth and loss of confidence in fiat currencies. The document argues that gold and silver should be given more consideration as stores of value and forms of money given the changes happening in the global financial system.
In gold-we-trust-2014-incrementum-extended-version-englishScutifyNewsBits
This document provides an extended summary of the report "In Gold We Trust 2014". It begins with an assessment of the current monetary climate since the decoupling of gold from the dollar in 1971. This led to a regime change where credit growth replaced savings-based growth and central banks became focused on pleasing financial markets through continual monetary interventions. The massive growth in total credit relative to GDP since 1971 is highlighted. Recent years have seen a battle between deflationary forces from debt liquidation and politically induced inflation, termed "monetary tectonics". The status quo of low inflation and market dependence on stimulus is examined, as the Fed attempts its third exit from unconventional policy. Global financial assets are growing much faster than real economic growth
The Henley Group's Market Outlook - August 2013Tania Scott
The document provides an overview and outlook for various global asset classes, including equities, fixed income, currencies and property. Key points include:
- European debt problems continue to deteriorate and discussions of bailouts, bail-ins and debt restructurings are resurfacing.
- The US economy continues to struggle with high unemployment and declining real wages. Detroit's bankruptcy filing highlights fiscal issues facing many US cities.
- China and Japan face their own economic challenges as China tries to rebalance its economy and Japan attempts stimulus through money printing.
- Precious metals saw a recovery in recent weeks after declines in April and June, but concerns remain around a potential collapse of the paper gold market.
-
The Henley Group's Market Outlook August 2013Sydney2008
The document provides an overview and outlook for various global asset classes, including equities, fixed income, currencies and property. Key points include:
- Developments in Europe continue to deteriorate with talk of more bailouts and debt restructurings that will impact depositors, bondholders and creditors.
- The US economy faces challenges such as high national debt levels and Detroit's bankruptcy highlighting issues for other cities.
- China and Japan each face their own economic challenges around rebalancing and stimulating growth.
- Precious metals saw a recovery in recent weeks after declines in April and June, though concerns remain around a collapse of the paper gold market.
- Equity markets are seen as dangerous and unstable while
The Henley Group's Market Outlook (August 2013)PeterWW
The document provides an overview and outlook for various global asset classes, including equities, fixed income, currencies and property. Key points include:
- European debt problems continue to deteriorate and discussions of bailouts, bail-ins and debt restructurings are ongoing.
- The US and Chinese economies face challenges like high debt levels and rebalancing efforts.
- The G20 is working on reforms to the international financial system including potentially moving away from dollar dominance.
- Equity markets are seen as risky while fixed income also faces challenges from a tapering of quantitative easing programs. Currencies and property markets vary by region but overall trends are neutral to negative.
The document provides an overview and outlook for various global asset classes, including equities, fixed income, currencies and property. Key points include:
- European debt problems continue to deteriorate and discussions of bailouts, bail-ins and debt restructurings are ongoing.
- The US and Chinese economies face challenges like high debt levels and rebalancing efforts.
- The G20 is working on reforms to the international financial system including potentially moving away from dollar dominance.
- Equity markets are seen as risky while fixed income also faces challenges from a tapering of quantitative easing programs. Currencies and property markets show mixed trends across regions.
The Henley Group's Market Outlook - August 2013Winston Lai
The document provides an overview and outlook for various global asset classes, including equities, fixed income, currencies and property. Key points include:
- European debt problems continue to deteriorate and discussions of bailouts, bail-ins and debt restructurings are ongoing.
- The US and Chinese economies face challenges like high debt levels and rebalancing efforts.
- The G20 is working on reforms to the international financial system including potentially moving away from dollar dominance.
- Equity markets are seen as risky while fixed income also faces challenges from a tapering of quantitative easing programs. Currencies and property markets vary by region but overall trends are neutral to negative.
The Henley Group’s Market Outlook publicationPedrojnr55
The document provides an overview and outlook for various global asset classes, including equities, fixed income, currencies and property. Key points include:
- Developments in Europe continue to deteriorate with talk of more bailouts and debt restructurings that will impact depositors, bondholders and creditors.
- The US economy faces challenges such as high national debt levels and Detroit's bankruptcy highlighting issues for other cities.
- China and Japan each face their own economic challenges around rebalancing and stimulating growth.
- Precious metals saw a recovery in recent weeks after declines in April and June, with signs of shortage in the metals market.
- Equity markets overall receive a negative assessment due to unstable financial markets,
StockTakers aid to small investors in the great Rotation continues. The biggest Wild Assed Guesser will be the donkey whose tale gets pinned, by market volatility. Whose money got pinned is a real ethical question.
Gold has historically been seen as a hedge against currency debasement and inflation. However, the document analyzes whether gold is a good investment now. While gold prices have surged in the past due to crises, this may be a temporary increase unless sustained inflation occurs. Central bank buying has supported gold prices, but retail demand is falling as consumers reduce spending during the economic downturn. Gold makes sense as a portfolio hedge but cannot be the primary investment due to its volatility and lack of dividends.
Conventional economics fails based in theory consisting of 'fantastic objects'. Equilibrium in efficient markets is a fantasy in fogginess. Clouds are a fact of open systems process.
For many, the investment world can be a confusing place. Banks, mutual finds, stocks, bonds, currencies, insurance, inflation, taxes, economies - it's no wonder the majority have glossed eyes.
And sitting on top of this confusion pie are central banks.
Each country has its own central bank which is responsible for setting overnight interest rates and the amount of money in that country's financial system.
Yet, there is one central bank that is the most important, sits on top of the world, and all of its actions impact not only their local country, but also every other country in the world.
This central bank is the US Federal Reserve.
In this latest IceCap Global Outlook we share how actions by the US Federal Reserve are always reactive to a crisis which, ironically, it helped create in the first place.
Today's central banks are once again, trying to thread the financial needle, and rescue us from the crisis that was born from the depths of the 2008-09 Great Financial Crisis.
The crisis is happening, yet there is good news - the crisis is creating opportunities to not only preserve your hard earned savings, but to capitalize too.
Cheviot Asset Management discusses recent changes to US Money Market Fund regulations that allow fund managers to suspend redemptions in extreme situations, concentrating moral hazard. This undermines the concept of money market funds providing risk-free returns and absolute liquidity. A secret meeting of central bankers was held to discuss the unstable global currency market architecture and transition to a new world currency order to avoid sovereign defaults, which could have consequences similar to the 1944 Bretton Woods accord. Rising global food prices may trigger a full-scale currency crisis if not addressed by agreements between governments.
Economics theory fails to comprehend how 'money' is the consequence of trading connections creation of business processes. 'Money' is invoked by the need of society to account for the outputs in ledgers without fully accounting for the inputs. From that observation the Risk Price develops in the modal geometry of the business process that correlates the worth of credit floats created by trading connections into the worth applied to support the firm and consistently appears as a modal pattern in ledgers. That geometry is fundamental in all firms business process. The consequent need for 'money' to account for trading connections driving exchange through the business process creates the need to invoke 'money' as banking creates. Alice, meet the money multiplier that achieves the liquidity for 'money' to flow through society's business, leaving its imprint on ledgers everywhere as if a phantom.
1. Henley Market Outlook
MARCH 2013
Alice would be proud!
Hong Kong | Singapore | Shanghai
THE WEALTH MANAGEMENT PROFESSIONALS
2. The Henley Outlook March 2013
Hong Kong, Singapore & Shanghai
Content
Equities
Global Overview .............................................................................................................................................. 3
Cash & Currencies
.............................................................................................................................................. 5
Fixed Income
............................................................................................................................................... 6
Property
.............................................................................................................................................. 7
Equities US ............................................................................................................................... 8
Japan ................................................................................................................................. 8
UK ........................................................................................................................................ 9
Europe Ex UK .................................................................................................................. 9
Australia ........................................................................................................................ 10
ASEAN ........................................................................................................................... 10
Greater China................................................................................................................ 11
India .............................................................................................................................. 11
Other Emerging Markets ......................................................................................... 12
Commodities Energy...............................................................................................................................13
Precious Metals.............................................................................................................13
Industrial Metals.......................................................................................................... 13
Agriculture.............................................................................................................. 14
Alternative Investments .............................................................................................................................................15
The Investment Committee
The Henley Investment Committee combines more than 110 years’ experience and
is unique in being backed by a full-time team of five investment professionals to
optimise asset allocation and manager selection.
Peter Wynn Williams George Rippon Paul Brady Chris Skinner
Investment Director Partner Partner Partner
& Partner
Andrew Kelly David Reynolds Simon Liu
Partner Partner Head of Investment
Research
2
3. Global Overview
Equities
Peter Wynn Williams “Why, sometimes I’ve believed as many as six impossible things before breakfast.”
Investment Director The White Queen, Through the Looking-Glass (Lewis Carroll, England, 1832-1898)
pww@thehenleygroup.com.hk
After a rollicking, if Alice-in-Wonderland start to the Gregorian year, the dawning of the Year
of the Snake ushered in an end to the markets’ scramble up the ladder, borne aloft by a rising
confetti soufflé of freshly-printed dollars and yen. Whether this slither down the snake will prove
terminal for the markets’ revived animal spirits remains to be seen, but it seems to me that for as
long as they keep printing, asset prices will keep inflating. Until they do not.
The supposed cause of the correction initially was the release of the minutes of the February
meeting of the US Federal Reserve’s Federal Open Markets’ Committee (FOMC). The committee
reportedly discussed stopping or slowing the programme of quantitative easing (QE), currently
running at USD85bn per month.
There is clearly a significant degree of disagreement and confusion at the Federal Reserve. Some
committee members clearly believe that open-ended and unlimited QE is a mistake and should
be rectified as soon as possible. Others believe that aggressive QE could be continued indefinitely,
until the economy can prosper under its own steam.
This reflects the fact that the world is now monetarily in uncharted waters. Zero interest rates
and QE have never been tried like this before. Ever.
What last month’s correction should have made clear to everyone was that the Federal Reserve
is trapped. There is no way that they can dispose of their Treasury bond holdings in an orderly
manner. Any hint of them doing so in FOMC minutes or anywhere else will result in a stampede
of investors trying to front run the Federal Reserve and sell first.
There is also no way that central banks can break records for the amount of money being
printed without it leading to rising consumer prices. Self evidently, we already have rising asset
prices. It ought to be equally obvious that central banks cannot exit QE because to do so would
lead to rapidly-rising interest rates, which would strangle whatever economic growth survived
at that point.
In this context, it is also important to realise that, when it comes to interest rates, it is not the
central banks who are in charge, it is the bond market. When the bond markets raise interest
rates, the printing presses will have to go into overdrive to cover governments’ rising interest
costs. Ask the PIIGS!
That means it is the paper currencies which will be left to take the strain through debasement/
inflation. ‘Twas ever thus, in fact, and recently we have seen sterling and the yen take their turns
to be on the receiving end. Every cloud has a silver lining, however, and for clients intending to
relocate to the UK sooner or later, who own gold (or silver!), or who are planning to use foreign
currency to buy UK property, their situation is improving. There is no need to rush, however. The
debasement of sterling (and the yen) will be an enduring phenomenon.
Which takes us neatly on to the monetary metals, gold and silver. After five years of money
printing, it ought to be obvious to everyone, except perhaps the most ardent Keynesians, that it
is not working.
That really leaves gold and silver as the only way out of re-balancing the books. One Sunday
evening in Basel, Switzerland, before the markets open in Japan on their Monday morning, the
Bank of International Settlements will announce that, henceforth, it will agree to buy unlimited
quantities of gold at, say, USD10,000 per ounce. Hey presto, balance sheets re-balanced. Banks
and sovereigns re-liquefied.
3
4. The Henley Outlook March 2013
Hong Kong, Singapore & Shanghai
Global Overview
Equities
Far fetched? Well, not really. It’s been done before. In April 1933, during the Great Depression, US
presidential Executive Order 6102 criminalised the possession of more than five ounces of gold
by any US person or entity. Within a three-week period, gold had to be surrendered to the Federal
Reserve in exchange for then market price of USD20.67 per ounce. In January 1934, the US Gold
Reserve Act re-valued gold by 70% to USD35 per ounce, where it stayed until 1971. Incidentally,
it was not legal for Americans to own gold again until 1975!
The idea of using gold to re-liquefy balance sheets is at last gaining traction in the mainstream
(the idea of confiscating gold is not – gold is owned globally these days, but it was not in 1933).
Indeed, the World Bank suggested it two years ago.
Before this can happen, however, the Chinese must be allowed to hedge their huge dollar position,
and back the yuan in preparation for its full convertibility by accumulating a respectable reserve
of monetary gold. To re-value gold before this had happened might be thought, in Beijing, to be
inconsiderate.
When push comes to shove (as it is doing, slowly) and growing deficits need to be financed,
governments always trump central banks. Witness what is happening now in Japan, with the
government ordering massive monetisation and inflation targeting, while dispensing with the
services of its uncooperative central banker, Masaaki Shirakawa, and replacing him with the more
congenial Haruhiko Kuroda. Other central banks are likely to see their hard-won independence
eroded, too.
In a nutshell, politicians are unwilling to raise taxes or cut spending. They will wave their magic
golden wand instead.
The Italians, too, must be tempted to wave the golden wand following the result of their General
Election, which was effectively a referendum on austerity. Fifty-seven percent of the votes went
to parties who want to turn their backs on austerity. The largest single party (25%) wants to
leave the euro.
Of all the nations in the euro, Italy is perhaps in the best position to leave. It has low private debt
and about EUR9tn in private wealth. Its total debt level is 265% of GDP, lower than in France,
Holland, the UK, the US or Japan. Its budget is near primary balance, and so is its international
investment position (in contrast to Spain and Portugal). It could in theory return to the lira
without facing a funding crisis, and this may be the only way to avoid a crisis if the European
Central Bank (ECB) withdraws support.
The great fear is that the ECB will find it impossible to prop up the Italian bond market under its
Outright Monetary Transactions (OMT) scheme if there is no coalition in Rome willing or able to
comply with the tough conditions imposed by the EU at Berlin’s behest. Europe’s rescue strategy
could start to unravel. Will Berlin now have to re-think its strategy? German leaders need to
keep up the appearance that the euro-zone crisis has been solved, at least until their elections
in September.
With the fourth largest gold reserves in the world (2452 tonnes) after the US, Germany and the
IMF (oh – and probably China by now, but they prefer to keep everybody in the dark), the magic
wand of gold re-valuation must be appealing to Italy, too (assuming, of course, that their gold is
not held at the Federal Reserve and has not already been secretly sold to China!).
Alice would be proud!
Peter Wynn Williams
Investment Director
4
5. Equities
Cash & Currencies
GBP/USD (Source: Dailyfx.com)
HENLEY ASSESSMENT Summary
Strongly negative ■■ Of all currencies, the GBP has had the worst start to the year, trading at its lowest level to
USD since June 2010. Confidence in the GBP has fallen sharply since Christmas and this was
Mostly negative GBP, followed compounded by February’s inflation report from the BoE. Negative real interest rates and
by JPY. USD and EUR to still fare huge additional supply through QE has left the GBP undesirable. This is however exactly
poorly over medium-to-long term what the BoE needs in order to devalue for growth and inflate away the debt. This new
against a trade-weighted basket trend is set to continue, but expect short-term corrections along the way. The GBP has much
of currencies given that all of further to fall.
these currencies are debasing ■■ Although aiming for similar results as the GBP, the USD has the benefit of being the world’s
and devaluing through significant reserve currency and indeed the currency for the trade of commodities globally. It will take
quantitative easing (QE). We still a much greater crisis of confidence to impact its value in the same way as we have seen with
favour SGD as a safe haven, and the GBP.
commodity currencies for yield. ■■ The JPY is losing value steadily against the USD as expected, totally in line with the increase
of the Nikkei. This is Abe’s fundamental strategy, pushing for inflation rather than deflation,
as well as export growth through a cheaper JPY.
■■ The SGD remains the new safe haven currency as a result of the strength of the city
state’s economy, and also the way the currency is managed. We expect this trend to
continue, and do not expect policy change from the Monetary Authority of Singapore
(MAS) meeting in April.
5
6. The Henley Outlook March 2013
Hong Kong, Singapore & Shanghai
Equities
Fixed Income
HENLEY ASSESSMENT Points of General Interest
Broadly negative, ■■ It was undoubtedly a significant moment in Feb13 when the outgoing Governor of the BoE,
however we see opportunity Mervyn King, was outvoted in his desire to add more QE to the UK Economy. This has set
in some emerging market and the scene for an interesting battle when the incoming chairman, Mark Carney, arrives as he
corporate debt. has publically stated his willingness to do what it takes to stimulate the economy. This new
rhetoric and presence at the head of the bank along with the recent topics discussed in the
While there may be some short- UK Monetary Policy Committee minutes suggests that the BoE is going to allow inflation to
term relief in fixed income from rise above the targeted 2% in order to give the economy the best possible chance to grow.
the volatility seen in equity
markets and also a comparative
positive return when compared to
holding straight cash, we are of
the opinion that such short-term
relief has the potential to come
at a costly price in the medium to
long term.
With the developed economies
committed to the path of
continued monetary easing, we
believe that inflation will become
a serious concern in the future.
This fear appears to have been
proven right by the rhetoric from
the most recent G20 meeting in
which world leaders appeared to
vindicate further monetary easing
without too much regard to the
potential inflationary pressures
that such a policy will likely create. Source: ONS
Such an environment would see
the relatively low yields enjoyed Government Bonds
by fixed interest overrun by severe ■■ After the previous rush away from the perceived safe haven of US Treasury bonds at the start
inflationary pressures. Following of the year, the concerns over the outcome of the Italian election at the end of February saw
this argument a stage further we these outlays return to being inflows; a stark reminder of how the political outcomes of Europe
feel that traditional fixed interest still have the ability to derail the positive momentum enjoyed at the start of this year. This
has transferred from being a serves to remind us that however counterintuitive it may seem given time of panic, investors
safe haven asset class to one still see US debt as a safe haven.
that in the post-GFC world holds ■■ February also saw the UK finally join the long list of previous sovereign heavyweights who have
significant risk for the medium to had their AAA rating downgraded by one of the ratings agencies; an act that will not endear
long term. Moody’s to the current coalition government. However, if previous recent downgrades are
anything to go by, it is a move that will not create too many issues with regards to increasing
the rate at which the UK borrows money from international markets.
Corporate Bonds
■■ With the concern surrounding the Italian election it was not only US Treasury bonds that
benefited from a temporary move away from equities, but also corporate bonds, with the final
Monday of February seeing the corporate bond markets having to digest nearly USD10b of
new corporate bonds being purchased.
Offshore Bank Accounts- Best Buys GBP
■■ No Notice Account- Nationwide International 1.60%pa.
■■ 95-day Notice- Nationwide International- 1.80%%pa.
Offshore Bank Accounts- Best Buys USD
■■ No Notice Account- Lloyds TSB International 1.51% (inclusive of a 1% bonus paid at month 12).
6
7. Property
Equities
HENLEY ASSESSMENT Positives
Neutral ■■ US residential property is rebounding as traditional homebuyers compete with investors for
a shrinking inventory of homes. The S&P/Case-Shiller index of property values in 20 US cities
Property prices generally, after increased 5.5% in November YOY, the biggest gain since August 2006 (19 of the 20 cities in
significant falls in 2009, stabilised the index posted gains). Prices were up 0.6% MOM. A plunge in US house listings to a 12-year
in 2010 and 2011. Property prices low is helping to drive prices up, as sellers are delaying until property values rise further.
in many areas have weakened in ■■ Prime central London property prices are up 53% since the market trough in 2009. It is
2012 and 2013 YTD as economic estimated that overseas buyers purchased GBP2.2bn of central London property in 2012, up
conditions remain difficult. 22% from GBP1.8bn in 2011. Knight Frank has identified three major factors underpinning
Property values have, however, demand for London property: first capital growth potential; secondly, a weak currency for
recovered in selected areas such foreign investors; and thirdly London’s continued leadership in top-flight education.
as Singapore, Hong Kong and ■■ Singapore home sales rose 43% MOM in January as buyers rushed in after the government
London. Additionally we are seeing announced its seventh round of cooling measures since 2009 to control the rise of residential
early signs of a recovery in the US property prices. The latest cooling measures include increased stamp duty on purchases and
housing market. We still consider higher deposits. Singapore home prices reached a record level in Q412.
some specialised property assets
Negatives
such as student accommodation
■■ UK residential property prices will not reach their 2007 peak until 2019, representing the
to merit inclusion in our portfolios.
longest housing market recovery on record according to Knight Frank. UK housing transactions
Other than these investments, we
are predicted to rise 2% in 2013 but will remain well below the peak levels for the rest of the
would suggest that clients do not
decade. Transaction levels have roughly halved since the last market peak in 2007 and are
invest further at this time.
35% below the 20-year average. House prices in UK have been flat or modestly declining since
2010; this reflects the continued economic uncertainty and tight mortgage lending rules from
the banks.
Source: Land Registry House Prices in Feb 2013
■■ New home prices in China rose 1% in January MOM representing the biggest gain for two
years, according to SouFun Holdings Limited (the country’s biggest property website owner).
This was based on its survey of 100 cities, and the increase was the biggest since January
2011. Chinese developers have turned optimistic because the government did not impose
additional measures to curb the property market last month. However, the markets remain
uncertain as there is speculation that the government will introduce further cooling measures
in March.
■■ According to Eurostat (the European Union’s Statistics office), housing prices in Ireland have
fallen by 50% since their 2007 peak, while in Spain prices are down around a third. At the
present time there is little likelihood of a recovery in either market.
7
8. The Henley Outlook March 2013
Hong Kong, Singapore & Shanghai
Equities
EQUITIES
UNITED STATES
HENLEY ASSESSMENT Positives
Negative on ■■ QE to infinity will inflate asset prices.
fundamentals, ■■ The US Federal Reserve has forecast rates will remain unchanged until at least 2015.
positive on markets short term. ■■ In the long term, demographics and returned energy self-sufficiency bode well.
Negatives
Chances of Congress and the
■■ National debt: USD16.5tn and rising; debt to GDP: 106% and rising. This is absurdly
White House addressing the
unsustainable.
long-term solvency issues of the
US government in a meaningful ■■ QE to infinity promises currency debasement, rising prices and lower discretionary spending.
manner remain nil. The changes ■■ Foreigners are buying fewer, and selling more US Treasury bonds.
required to balance the system ■■ The debt ceiling “temporarily suspended” plus QE to infinity may result in a currency crisis in
are too politically painful, so a a couple of years.
currency crisis within the next
couple of years seems the most
likely outcome – especially if
there is a black-swan event, such
as an assassination, a COMEX
default or a bomb on Iran, for
example. Meanwhile the economy
continues to bottom bounce,
fundamentals continue to
deteriorate, and markets continue
not to care, buoyed by a rising tide
of confetti (and nothing else).
JAPAN
HENLEY ASSESSMENT Positives
Neutral ■■ The Secretary General of OECD defended Japan’s monetary easing. He argued Japan is
aiming to beat deflation rather than simply weakening JPY against currencies of other
We doubt if “Abenomics” are competitor economies. The incident was seen as an endorsement of a weaker JPY by the
sustainable and sound economic developed countries led by the US.
policies in the medium term; that ■■ JPY further weakened to Y93 after the Governor of Bank of Japan (BoJ) announced that
is Japan waiving the debt limit of he will step down on 19 March, three weeks prior to his official term ends. The market is
JPY44tn (USD514bn) for the fiscal expecting a fundamental shift in Japan’s monetary policy as Prime Minister Abe stepped up
year and targeting higher (2%) his pressure on BoJ.
inflation. Japan has accumulated
Negatives
debts worth some USD14.6tn,
■■ Japan remained in technical
or 230% of GDP. A quarter of
recession through Q4, with GDP
Japan’s budget now goes to
falling 0.1% QOQ and 0.4%
servicing debt. So far Tokyo has
annualised. Private investment fell
done little to change its course.
sharply over the last quarter. Both
exports and imports fell sharply
highlighting a case for aggressive
monetary easing.
■■ Japan’s trade deficit nearly tripled
in 2012 to JPY6.93tn (USD77bn).
A sharp expansion of deficit from
JPY2.56tn (2011) highlights the
increasingly complex challenges Source: Der Spiegel
faced by Japan which has promised aggressive measures to end two decades of disappointing
growth.
8
9. EQUITIES
Equities
UNITED KINGDOM
HENLEY ASSESSMENT Positives
Negative ■■ The Chancellor George Osborne has ordered Treasury officials to draw up plans for a
government “give-away” of Royal Bank of Scotland shares to boost the economy – and the
The pressure continues to coalition’s electoral prospects – by 2015. Mr Osborne has concluded that continued taxpayer
intensify on the Chancellor ownership of the bank is politically “untenable” amid rows over bankers’ bonuses, interest-
George Osborne. As predicted in rate manipulation and the mis-selling of financial products. Advisers also believe that there
our Outlook last month, Moody’s is no realistic prospect of the government recouping its full GBP45bn investment in the bank
became the first of the major and are proposing a scheme to “hand it back to taxpayers” as early as 2015. Under one plan
agencies to remove the UK from being developed, every taxpayer or voter in Britain would be given shares in RBS that would
the elite club of AAA countries, be worth, according to one Treasury insider, between GBP300 and GBP400 at current prices. If
blaming “subdued growth” and a this was to proceed, it would certainly help to stimulate the economy in the short term.
“high and rising debt burden” for Negatives
the decision to cut the rating by ■■ Britain has been through the “Winter of Discontent”, the miners’ strikes, the recessions of the
one notch to AA1. The rating is 1980s and 1990s, the implosion of the banks and five years of the euro zone debt crisis to
significant because it can affect boot – yet has never lost its AAA credit rating, until now. Entering into these uncharted waters,
a country’s cost of borrowing and Britain’s economic skipper George Osborne has insisted he will not change course. However
is also symbolic to governments the chancellor will now come under intense pressure to re-think his austerity plans ahead of
determined to prove their next month’s Budget. One things markets hate is uncertainty.
economic credentials. Within the
G7 economies, only Germany
and Canada currently still hold
the coveted AAA rating. In the
short term sterling will continue
to come under pressure on foreign
exchange markets.
EUROPE EX UNITED KINGDOM
HENLEY ASSESSMENT Positives
Strongly Negative ■■ The euro zone December unemployment rate was unchanged at 11.7%; better than expected.
The report from the EU’s statistics office provided some much needed positive news that the
The GDP data from the euro euro zone labour market at least did not get any worse in Dec12.
zone show that the 17 countries Negatives
have not expanded as a group ■■ The economy across the 17-nation shared-currency bloc shrank 0.6% in 4Q12, compared to
since the autumn of 2011; a vivid analysts’ expectations of a 0.4. The German economy, Europe’s largest, shrank 0.6% over the
reminder that the more optimistic same period while economic activity shrank 0.3% in the quarter.
mood in European financial
■■ Barclays’ analysis of ECB data suggests that companies based in the “core” of the bloc have
markets – and recent meetings of
been the main beneficiaries of the central bank’s promise last June to do “whatever it takes”
European governments – has yet
to save the euro zone. Companies based in France, Germany, Belgium and Holland were able
to leave much of a mark on the
to borrow a net EUR37bn of ultra-cheap debt from the markets in the second half of last year
real economy. For the likes of Italy
following the announcement. Companies based in Italy, Spain, Portugal and Greece added
and Spain, the 4Q figures are the
only about EUR12bn of market borrowing, with only the biggest companies such as Telecom
culmination of a dismal year, which
Italia and Telefonica able to access the capital markets.
has seen their economies shrink
■■ A strong appreciation of the single currency has fuelled fears that a nascent recovery for the
by upwards of 2%. Portuguese
bloc may be in jeopardy. The EUR’s relative strength comes amid heightened tensions that
national output shrank by nearly
loose monetary policy adopted by major central banks around the world could spill over into
that much in 4Q12 alone, ending
a series of competitive devaluations.
2012 nearly 4% smaller than at the
end of 2011. Even the optimists are
not expecting the crisis economies
to actually grow for many months
yet. The worry for European
policymakers right now ought to
be how that continued gloom is
going to play out politically.
9
10. The Henley Outlook March 2013
Hong Kong, Singapore & Shanghai
Equities
EQUITIES
AUSTRALIA
HENLEY ASSESSMENT Positives
Neutral ■■ The RBA decided to leave interest rates unchanged, following rate cuts in May, June, October
and December 2012.
The RBA’s assessment of the need ■■ The bank also announced that it is encouraged that interest-rate sensitive parts of the
for additional rate cuts will be economy had shown some signs of responding to these lower rates, which were well below
shaped by the housing sector’s their longer-run averages, and further effects could be expected over time.
response to lower interest rates, ■■ The Westpac–Melbourne Institute Index of Consumer Sentiment posted a strong 7.7% rise in
developments in the labour February, moving from “neutral” to “optimistic” territory.
market and prospects for non- ■■ Australian house prices rose last quarter by the most since Jun10 as lower rates lured buyers
mining business investment. back into the market. The nation’s benchmark stock index climbed 4.9% last month.
The CAPEX survey, published
28Feb13, provides a critical input Negatives
into this assessment. We see the ■■ In the Australian government monthly financial statements for Dec12 released 15Feb13, the
risk that the pending downturn government revealed a material slippage in its 2012/13 budget position over the initial six
in mining investment will not be months of the financial year, centred on lower-than-expected company tax revenues, and a
offset sufficiently by an upturn in shortfall in resource rent taxes.
non-mining business investment ■■ In its quarterly statement released 8Feb13, the RBA predicted “below trend” 2013 growth of
(and housing activity). Current about 2.5%, compared with the around 2.75% forecast in November.
domestic economic conditions are ■■ A government report showed retail sales unexpectedly fell for a third month in Dec12, the
patchy and the risks to the RBA’s longest stretch of declines in 13 years.
central case forecast are to the
downside – hence the need for
additional stimulus.
ASEAN
HENLEY ASSESSMENT Positives
Positive ■■ Indonesia, Thailand and Singapore have announced airport expansion plans in response to
surging travel demand. Asia Pacific overtook North America as the world’s biggest aviation
Consumer goods companies, market in 2009. The region’s passenger growth, both domestic and international, is expected
retailers, education and health- to add about 380m travelers between 2012 and 2016 to 1.2bn.
care industries are attractive as ■■ Thailand’s fourth-quarter growth accelerated more than economists estimated, joining
urbanisation spurs more people to ASEAN nations from Indonesia to Philippines in showing resilience to the faltering global
move into cities, forming a large economy as local demand rises.
pool of middle class, especially
Negatives
in the bigger economies of
■■ The Indonesian president is under growing pressure to raise the price of subsidised fuel to
Singapore, Malaysia, Indonesia,
curb the current-account deficit as his window to act narrows ahead of elections in 2014. A
Thailand, the Philippines and
44% increase in the minimum wage in Jakarta and a 15% rise in electricity prices this year are
Vietnam. The relative stability and
adding to the inflationary pressure.
continuous growth in the region is
■■ The Philippine central bank is considering measures to counter excessive capital inflows lured
an attractive proposition; ASEAN
by growth, joining Singapore in warning that policy makers need to consider more steps to
look attractive amid global
reduce the impact of such funds.
challenges including low growth
in the US, Europe’s sovereign
debt crisis and limited growth
prospects in China and India.
10
11. EQUITIES
Equities
GREATER CHINA
HENLEY ASSESSMENT Positives
Positive ■■ The China economy seems to have
bottomed out – the purchasing
The bullish sentiment continues. manager index (PMI) indicates that
Progress towards a domestic, new orders have climbed substantially
consumption-led economy is since mid 2012.
definitely taking place, and seems ■■ China surpassed the US to become the
likely to continue at a rapid pace, world’s biggest trading nation last year,
a necessary part of the longer- as measured by the sum of exports and
term structural changes in the imports of goods, official figures from
economy, as well as a necessary both countries show. Source: Nomura
step towards correcting global ■■ China’s annual consumer inflation eased from December’s seven-month high in January,
current account imbalances. The despite rising food prices. January inflation slowed to 2% YOY growth.
middle class doubled in the last ■■ An improving economic outlook is set to give retail sales a boost during the biggest buying
five years and will probably double season of the year. The Lunar New Year is a period when consumers splurge on everything
again in the next ten. On the other from beauty products and jewellery to lavish family dinners. China’s retail sales for January
hand, the Chinese government and February may rise 15.4%, the fastest pace in 13 months, according to nine economists
appears to be embracing lower surveyed by Bloomberg.
but more sustainable levels
of economic growth. This Negatives
■■ The key downside risks for China’s economy in 2013 include a stalemate on the US debt ceiling,
provides the opportunity for the
continuation of measures to ease geopolitical risks in the Middle East and an escalation in tensions between China and Japan.
credit conditions and support ■■ The biggest worry among investors is that China’s banking system non-performing loans
expenditure on social housing (NPLs) may rise substantially – it will probably continue to rise in the coming two to three
projects, the development of quarters, but will peak within the year.
infrastructure and the promotion
of domestic consumption.
India
HENLEY ASSESSMENT Positives
Neutral ■■ India’s headline inflation Wholesale Price Index (WPI) decelerated to 6.62% in Jan13 from
7.18% in Dec12, leaving enough room for the central bank, the Reserve Bank of India (RBI),
The powerful monetary response to cut rates and spur growth.
to tame inflation has significantly ■■ Total new business in the private sector increased to a 11-month high with the PMI expanding
impacted consumption; as such sharply from 55.6 in Dec12 to 57.5 in Jan13.
the projected growth rate of 6.1- ■■ In a bid to spread financial services into the rural market – comprising 600,000 villages, 90%
6.7% in 2013-14 is much lower of which do not have a single bank – the RBI has now offered new banking licences.
than expected for a country the
Negatives
size of India. With the threat of
■■ Corporate investment sector declined by 2.8% of the GDP in 2011-12 compared to the earlier
a possible downgrade looming
year thanks to the policy bottle necks and tight monetary policy.
large, all eyes are now set on
28 February when the finance ■■ Annual growth of private consumption expenditure declined to 4% in 2012-13 compared to
minister is expected to address 8% in the previous year while household financial savings too were reduced from 10.4% of
the fiscal deficit and current GDP in 2010-11 to 8% in 2011-12.
account deficit through a prudent ■■ Current account deficit continues to balloon from 2.6% (of the GDP) in 2010-11 to 4.2% in
rather than populist budget. 2011-12 and 4.6% in H1 of this financial year to 5% in Q3.
11
12. The Henley Outlook March 2013
Hong Kong, Singapore & Shanghai
Equities
EQUITIES
Other Emerging Markets (South Korea, Russia, Brazil)
HENLEY ASSESSMENT Positives
Neutral ■■ Russia will probably refrain from easing borrowing costs this month after inflation surged to
a 15-month high and the central bank indicated it would not yield to government calls for
The scale of fiscal stimulus in lower rates.
South Korea will be limited as ■■ Mexico’s four-year-old expansion, slowing inflation and debt ratios half those in the US are
the new Finance Minister, Hyun factors winning over investors searching for stable returns as Europe’s economy heads for a
Oh Seok, will not compromise contraction. Latin America’s second-biggest economy, which is about half the size of Brazil’s,
on the country’s fiscal healthy outgrew its larger regional peer in each of the past two years, posting annual expansions of
by engaging in aggressive about 4% as construction and auto production jumped.
fiscal spending. The short-term Negatives
challenge will be to find way to ■■ South Korea’s economy expanded 2% in 2012, the slowest pace since annual growth fell
secure a rapid economic growth to 0.3% in 2009. That compares with a potential rate of 3.8% estimated by central bank
without printing more money. governor Choongsoo Kim. Policy makers also face the problem of a working population that’s
Similarly, nations like Russia and expected to start shrinking in 2017, according to a finance ministry report last year.
Brazil are finding it tough to
■■ The Bovespa index fell to an 11-week low as economists covering Brazil reduced their 2014
stoke economic growth without
growth forecasts, rekindling concern that a slower recovery will hurt corporate earnings.
inflation spiking up. Inflation is
at a 15-month high in Russia, ■■ Russia, the largest emerging nation to raise rates in 2012, is facing growing government
while Brazilian consumer prices pressure to ease monetary policy after economic growth last year slowed to 3.4%, the weakest
rose the fastest in Jan13 at the since the 2009 recession.
fastest pace in eight years. Other ■■ Shares of BRIC nations are lagging behind as their economic growth advantage shrinks and
emerging economies are looking investors shift money to smaller emerging markets, including Turkey and the Philippines. GDP
more attractive relative to these in the BRICs probably increased 4.2% on average in 2012, versus 3.2% for the world economy,
nations. according to the IMF. The 1%point gap would be the smallest since 1998.
12
13. COMMODITIES
Equities
Energy
HENLEY ASSESSMENT Positives
Neutral ■■ Risk of supply disruption from countries such as Iran has kept oil price high.
■■ Emerging market demand pushed the oil price higher.
We remain neutral. The global Negatives
economy remains in a precarious ■■ Concerns about the euro zone and the Italian election result, and thoughts of growing US
state and with the impending stockpiles.
sequester budget cuts looming in
■■ US sequester budget cuts.
the US, we see better opportunities
elsewhere.
Precious Metals
HENLEY ASSESSMENT Positives
Positive ■■ Gold is a good hedge against currency debasement and future inflation.
■■ Gold and gold mining shares remain an under-owned asset class compared to financial assets.
February was a difficult month for Negatives
gold as speculators pushed the ■■ Short-term price volatility as speculation exists about an end to QE in the US.
price down on the minutes of the
Federal Reserve policy meeting,
which showed some members
suggesting that QE should come
to an end sooner than expected.
However, there was a significant
bounce following the comments
of Federal Reserve Chairman
Bernanke during his half yearly
testimony to Congress, when he
signaled that the Federal Reserve
is prepared to keep buying bonds
at its present pace. Central banks
continue to be buyers of gold,
particularly those in developing
countries. The official reserves of
these countries continue to grow
and as these reserves are heavily
biased to the USD and EUR, gold
is an attractive option as they
look for ways to diversify.
13
14. The Henley Outlook March 2013
Hong Kong, Singapore & Shanghai
Equities
Commodities
Industrial Metals
HENLEY ASSESSMENT Positives
Neutral ■■ China continues to restock commodities to the benefit of major commodity-exporting
countries.
We remain neutral on this sector. Negatives
The global economy continued ■■ Sluggish global economies and austerity continue to weigh heavily on the sector.
to shrink in 2012 and this took
its toll on producers of base
metals. Prices for copper, iron
ore and aluminium fell sharply
with decreased demand, and the
import price for iron ore in China
has increased by over 75% in the
past five months.
Agriculture
HENLEY ASSESSMENT Positives
Positive and negative ■■ Warren Buffett’s investment powerhouse Berkshire Hathaway and 3G Capital have
announced they will take over US tomato sauce and baked beans maker Heinz in a deal worth
Two very different markets are USD23bn. This could lead to broad cost-cutting measures across the industry and a possible
playing out in this sector – physical rerating in the valuation of similar companies.
and equity. Many physical soft ■■ UN’s Food and Agriculture Organization estimates there will be over nine billion mouths to
commodity prices have exploded feed on the planet by 2050.
due to changing global weather ■■ Middle class consumers in BRIC economies are increasingly demanding more varied and
patterns over the past few months, protein-rich foods. As affluence increases protein from beef, sheep, poultry, pigs, cows and
however these sharp price increases fish may in turn displace grains in diets.
tend to be followed with just as ■■ Urbanisation and life expectancy is expected to increase.
sharp falls; there is a very seasonal
and cyclical pattern. With many Negatives
soft commodity prices at or near ■■ Prices are subject to
record highs we have a negative many uncontrollable
view on investing and encourage risks, eg, weather
profit taking. On the equity side, and natural disasters,
the largest weighting funds have politics and other pests.
to this sector is via fertilizer and ■■ Due to recent drought
seed companies, which are having conditions in the
a significantly more important role American Mid-West
to play to help increase yield and in and Russian Black
the case of seed companies, invent Sea regions, we have
seed which is more tolerant to seen corn, wheat and
changing global weather patterns. soy prices increase
We remain positive on agriculture on average over 50%
equity funds. within a few months. Source: DWS
14
15. Alternative Investment
Equities
HENLEY ASSESSMENT Positives
Neutral ■■ Hedge funds made money in January. The HFRX Global Hedge Fund index ended the month
with a gain of positive 2.0%. Overall, there was a slight increase in gross and net exposure
We have to admit that for the past across managers.
two years it has been unusually ■■ The best return for this year so far came from security selection specialists in equity long-
difficult for active management short space.
styles to generate returns. ■■ A number of fundamentally-oriented managers reported excellent trading profits in 2012.
In hedge fund space, those Managers with longer-term holding periods and higher conviction positions tended to be the
managers, who tend to eschew winners as equity moves appeared to depend on value-based metrics.
traditional sources of return such
Negatives
as static market exposure, have
■■ We are still having concerns that Managed Futures return would be under threat in the event
been particularly problematic.
of a sell-off in the bond market.
A material improvement in the
global economic landscape ■■ Despite total assets under management surpassing its previous high in 2008, managers and
made us believe markets this investors are largely cautious going into 2013. New regulations created an added burden
year will be more reactive to for fund managers, and high-profile SEC enquiries into leading hedge fund names, and
fundamental data rather than continued market volatility which led to performance concerns, resulted in further investor
political influence. Higher level dissatisfaction.
of dispersion within markets and ■■ The chart shows the key
lower systemic risk both give us issues investors and fund
confidence that hedge funds managers feel are facing the
of some strategies should have hedge fund industry in 2013.
huge potential to generate non- Both investors and fund
correlated returns in 2013, more managers are aligned in their
so than they have for the past two agreement that performance
years. is the No1 issue that needs to
be addressed in the following
year. 2013 could prove to be
a vital year for the industry,
and managers will need to
post strong returns in order
to satisfy those investors
Source: 2013 Preqin Global Hedge Fund Report
that have been disappointed
with the industry’s performance over the past few years.
General disclaimer and warning
The Henley Group Limited (“The Henley Group”) has produced this document for your private use only and you must not distribute it to any other person in Hong Kong. Re-distribution or reproduction in whole or in part of this document by
any means is strictly prohibited and The Henley Group accepts no liability for the actions of third parties in this respect. Funds not authorized by the Securities and Futures Commission may involve more risk and distribution or re-distribution of
information relating to such funds to the public of Hong Kong may constitute an offence under the Securities and Futures Ordinance. Notwithstanding that the information contained herein has been obtained from sources which The Henley
Group believes to be reliable, The Henley Group makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy, completeness or correctness. The information in this document, including any expressions
of opinions or estimates, should neither be relied upon nor used in any way as indication of the future performance of any financial products, as prices of assets and currencies may go down as well as up and past performance should not be
taken as indication of future performance. Neither this document nor any information contained herein shall be construed as an offer, invitation, advertisement, inducement, representation of any kind or form or any advice or recommendation
to buy or sell any financial products.