Equity Bear Market and Today’s Macro: The Good, The Bad, and The Ugly

The U.S. and global stock market have officially entered the bear market in June following upside surprises on U.S. inflation that was followed by the Fed having to raise its interest rate by 75bps – contrary to Chairman Powell’s comment that such size of hike is not on the table weeks earlier. Monetary conditions haveContinue reading “Equity Bear Market and Today’s Macro: The Good, The Bad, and The Ugly”

Have We Seen the Cyclical Top in Commodity and Stock Market?

Download PDF: For the past several months we have ramped up our bearish view towards risk assets amid the unfavorable global macro and geopolitical backdrop. Central banks across the world are tightening aggressively as inflation spiked to decades’ high in many developed countries and over double digit in several developing economies, while fiscal boosts areContinue reading “Have We Seen the Cyclical Top in Commodity and Stock Market?”

Strength of the U.S. Economy and Implications of Russia’s Ukraine Invasion

Download PDF: Three market moves have dominated the macro landscape in the past quarter amid the Fed tightening policy and geopolitical tension in Eastern Europe: rise in Treasury yields, strengthening dollar, and rally in oil prices. These all amount to a growth tax for consumers, which will inevitably lead to a growth slowdown in theContinue reading “Strength of the U.S. Economy and Implications of Russia’s Ukraine Invasion”

August 2019: The Long View, Turkey and Revisiting This Year Investment Thesis

Read in PDF: Monthly 201908 As bond yields continue to stumble globally, we expect that more SWF and pension fund will divert allocation from fixed income to both public and private equity, which would be a boon for the deepening of stock market globally. Holding developed countries’ government bond is a sure way of losingContinue reading “August 2019: The Long View, Turkey and Revisiting This Year Investment Thesis”

July 2019: Recession vs Reflation

Download PDF: Monthly_201907 “For months investors have been concerned about potential recession in the U.S., yet the stock market is at all time high. How could we reconcile these developments?”, asked one my friend who is working at an asset management company. The effects from reflationary effort from China has yet to be seen andContinue reading “July 2019: Recession vs Reflation”

April 2019: Is the Recession in Front or Behind Us?

Download PDF: March19_PC It is tempting to argue that we are currently experiencing the “manufacturing recession”, similar to the “commodity recession” we experienced back in 2011-2012 and 2014-2015. All the data is supporting the thesis that we did have a recession in 2018, albeit a mild one: 1) industrial production and manufacturing PMI weakens inContinue reading “April 2019: Is the Recession in Front or Behind Us?”

Equity Market Correction: Historical Performance of S&P500 Following Greater Than 3% Weekly Loss

Read the article in PDF (with tables): Risk Management Report on February Market Correction February 6th, 2018 Findings: 2 consecutive weekly losses greater than 3% is rare (1% of the time) and 3 consecutive losses is even more scarce (0.2% of the time) The 3 consecutive losses greater than 3% were always happening during recessionary periodContinue reading “Equity Market Correction: Historical Performance of S&P500 Following Greater Than 3% Weekly Loss”