HEDGED.BIZ

A look at economics, markets, finance and the irrational human being

Make Britain Great Again.

It is very hard to optimistic about anything about Britain. The people are divided, quite evenly, between those who wanted to stay in the EU and those who would leave it. A referendum has effectively documented this fact. The decision was taken without a thorough understanding of the consequences of leaving the EU, as various
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Brexit A Year On. No Clear Mandate. The Need For A New Unity.

I am neither British nor European, so I may not understand the historical and cultural context of Brexit. However, as an external observer, I can see great difficulties ahead for Britain, some of which I believe will be nearly impossible to resolve. The UK voted to leave the EU by a vote of 52% for
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Weak Inflation, Fed Policy and US Bond Yields. Bond Rally To Continue?

Given the importance of inflation to central bank policy and thus to investors, it is useful to look not only at headline growth rates of CPI but also at the components of the index and the behaviour of each component. Housing represents 42.6% of the basket. Within that, owners’ equivalent rent, not a cash flow
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How High/Low/Long Can You Go?

Can US equities sustain a bull market or even current levels without central bank support? Prior to unconventional monetary policy, the last 2 bull markets lasted from 1995 – 2000, and 2002 – 2007, or roughly 5 years in each case. What is not so easy to explain is why equities and corporate bonds have
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Europe. Growth, Value and Slightly More Stability (well, relatively)

Europe is in steady recovery mode, benefiting from the delayed effects of QE. Eurozone Purchasing Manager Indices (PMIs) have been rising across manufacturing and service industries for the last 6 months. Industrial production is growing at a steady 1.9%. Inflation has risen to 1.9% headline and 1.2% core. GDP is forecast to rise at 1.70%
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