Investment & Business News Headlines

Is that a sword of Damocles hanging over the UK housing market?

There once was a king in Sicily called Dionysus. He had a courtier called Damocles who, in his efforts to flatter his King, told his liege how fortunate he was. To teach the obsequious inferior a lesson, Dionysus offered to swap places. There was a catch, however; above Damocles, sitting on his newly acquired throne, there hovered a sharp sword dangling by a horse’s hair, and arranged that way by Dionysus. The fear that the sword might finally fall, severing poor old Damocles’ arteries, proved too much for the imposter...Read More

History re-written: no double dip, but deeper recession

“The recovery is based on shaky foundations,” said Capital Economics in its analysis of the latest data on UK GDP. The good news, according to our beloved complier of statistics otherwise known as the ONS, is that the UK never did have a double dip recession after all. The bad...Read More

Posted Jun 27, 2013

China’s credit crunch. It is more like 2006 than 2008

It is not often that we get a chance to test theories, at least not when it comes to the economy. But we have such a chance right now, and it relates to China, and whether or not China is experiencing its own credit crunch, or something altogether less serious.Read More

Posted Jun 25, 2013

Watch out for opportunities in Thailand says Schroders

In 2004, the US Federal reserve upped interest rates. Three years later crisis rocked South East Asia. Some fear a repeat of this, but Matthew Dobbs, fund manager of Asia ex Japan equities at Schroders, is cynical about such cynicism when it comes to the so-called ASEAN counties, and especially...Read More

Posted Jun 21, 2013

Pensions lose money, warns study

As you know, we are ageing. We are all literally ageing, of course; there are no real life Benjamin Buttons out there. But as a country and as an economy we are ageing too, and that means there could be a pension problem in the future. The solution is obvious....Read More

Posted Jun 25, 2013

US and Canada stars of downturn, but watch out for that Canadian debt

Sometimes data is too good to ignore, and the latest Economics Review from the ONS contains such data. It shows that the star of the recession of 2008 was Canada. In Q1 of this year, Canadian GDP was no less than 5.1 per cent up on the pre-recession high. Read More

Posted Jun 19, 2013

Majestic wins as customers stay at home; Costa wins as they go out

Fancy a glass of wine? Have this then, I bought it from Majestic last week, it is called ‘Chateau North of £20’. Fancy a coffee? Well let’s go out then and buy a cup of ‘Capper Expensive’ from Costa Coffee.

For Majestic and Costa, and indeed for Costa’s parent company Whitbread,...Read More

Posted Jun 18, 2013

Markets panic over end of QE, as emerging market currencies tumble

The US consumer is paying back debt. Within a couple of years, this little critter may once again be the lynchpin of global economic growth. But if US consumers return to normal, does that not mean US interest rates will do so too?

The Fed has already dropped hints...Read More

Posted Jun 14, 2013

Austerians strike back

The IMF is a critic. It reckons the US has hit the brakes too fast, and wants to see more stimulus measures. As for the UK, it wants to see more short term borrowing to fund investment into infrastructure. The Bank of International Settlements (BIS), often called the world’s central...Read More

Posted Jun 24, 2013

US economy sees good news temper bad

It has been rush of good news on the US economy, but last week nearly saw it all spoilt. Thank goodness for Friday, because news out then just about saved the day, and stopped the good turning to bad.

Just to remind you: US consumer confidence has hit a...Read More

Posted Jun 11, 2013

Beyond the BRICs: which emerging markets are vulnerable to the end of QE?

The markets are not always rational, and in times of backlash can sometimes punish a country which may have been seen as quite strong under different circumstances.
Credit growth has been common across much of the emerging world, but in some countries while credit growth has grown rapidly it remains...Read More

Posted Jun 10, 2013

The end of QE and the BRICs

If there is one thing finance ministers and their equivalents from Brazil, Russia and China had in common, it was their criticism of the US policy of quantitative easing. Brazil was especially vocal, and its finance minister accused the US of engaging in currency wars as QE in the US...Read More

Posted Jun 10, 2013

News on the US to even make the cynics a little less cynical

If you like your news with a twist of misery and a slice of disaster thrown in, then apologies, you will be disappointed with the latest economic data coming out of the US. On the other hand, if you like to be cheered up, read on.

The latest batch...Read More

Posted Jun 26, 2013

Tax havens keep governments in check!

“The existence of tax havens, coupled with high mobility of capital, means governments are constrained in the tax rates they could otherwise apply - crucial for both wealth and job creation,” or so says the Institute of Economic Affairs.
These are brave words, given the current climate.

The Institute...Read More

Posted Jun 21, 2013

US medicare time bomb begins to look more like a pretty time piece

As you know the US is effectively bust. There is a long list of perennial bears on the US economy who claim that commitments to future medical care costs mean the US is living off borrowed time.

They produce their calculations of woe like this. They look at how...Read More

Posted Jun 19, 2013

Are markets dominated by feral hogs, bond vigilantes, or all round nice guys?

During the height of the euro crisis, politicians in Europe, and indeed central bankers, blamed the markets and credit ratings agencies. Yesterday an official at the Fed followed that tactic too.

Richard Fisher, president of the Dallas Federal Reserve, told the ‘FT’: “I do believe that big money does...Read More

Posted Jun 25, 2013

UK inflation rises again. Will Carney have to write a letter?

It’s not long now. Mark Carney will be settling into his new job as the governor of the Bank of England in a few weeks’ time. Alas, if the latest inflation data is any guide, one of his first tasks may be to write to George Osborne explaining why inflation...Read More

Posted Jun 18, 2013

Emerging market debt – the potential losers

In 1994, the US Federal Reserve increased interest rates. The eventual effect of this was the Asian crisis of 1997, then the Russian crisis of 1998 and the collapse of LTCM. History does not repeat itself, once said Mark Twain, but it does rhyme.

Did you hear that? It...Read More

Posted Jun 14, 2013

US is two years away from return to normal; the UK is two years behind that

According to the OECD, US household gross debt to gross disposable income had fallen from 130.7 per cent in 2007, to just 107.9 per cent at the end of 2012.

According to the Fed’s latest US Financial Accounts, debt as a share of disposable income has fallen to 110...Read More

Posted Jun 14, 2013

Markets ditch safety and risk

Yesterday was a day for selling. But it is noticeable that while gold fell to a 34 month low, and US government bonds to a 22 month low, on the whole equities merely fell to a one month low.

At the time of writing gold is trading at $1,295....Read More

Posted Jun 21, 2013

The end of QE: Canada and Australia


If QE in the US is coming to an end, what does that mean for the rest of the world?

Two countres that may be vulnerbale are Canada and Australia.

There are certain parallels between the Australian and Canadian economy today and the US and UK in 2007/08.



Take household...Read More

Posted Jun 10, 2013

© Investment & Business News 2013