Category: Daily Instagraph

Debt defaults are on the rise in the US: 69 firms missed debt payments y-t-d, up from 25 firms in the same period of 2022 and above the levels seen since the financial crisis. This is due to the stress put by higher interest charges on the P&L’s of the companies. While the absolute number … Continued

It is now 15 years ago that Lehman Brothers has gone bankrupt. The repercussions of the fall-out of a systemic bank have been felt worldwide with a detrimental impact on growth, a push towards re-regulation of the banking sector, a major debt crisis and ultra-low interest rate policies pushed by central banks. One of the … Continued

World oil demand (including gasoline, diesel, jet fuel, LPG, …) is back to pre-covid levels and continues to grow. This is despite the well mediatized and noticeable efforts made to develop alternative energy sources. Fact is that renewables are not (yet) making a noticeable economic difference on a global scale. With the investments in finding … Continued

Bond defaults are on the rise in the US. The new credit cycle is the direct result of the rising interest rates. We believe the situation will worsen over the coming months even if the Fed will pause hiking rates. In fact, as the economy will start to slow down, corporate debt will eventually need … Continued

US stocks have now outperformed the global stocks by almost 3 times! (in USD terms). This is the highest level since WWII and more than during the Nifty 50 bubble and during the Internet bubble. There are reasons for the current dominance of US stocks: 1) the high weight of highly performing US tech stocks … Continued

As expectations of Powell’s speech at the Jackson Hole symposium and Nvidia’s consensus beating results make the headlines, there is little discussion on the worsening economic environment in Europe. The Eurozone composite PMI, the most important economic leading indicator, is now in contraction territory ( below 50 ). This is not only driven by the … Continued

The likelihood of making a positive return in stock market increases substantially with your holding period. At least this has been the case for investors in the S&P500 with data going back to 1928. If you invested for 1 month in the S&P 500, the probability of a positive return was 63%. If you invested … Continued

The last time the gap between the yield of the 10 Year Treasury and the dividend yield of the S&P500 was so high was in 2007! On this measure often used by the Fed and called the Fed model, equities have not been as expensive compared to bonds in more than 15 years. Also there … Continued

Morgan Stanley summarizes the key risks facing the Chinese economy as the 3Ds – demographics, deflation and debt. A lot has been written about Chinese demographics being the result of State policies. The current economic data coming out of China is not reassuring while debt levels are unsustainably high. We draw three conclusions: 1/ Chinese … Continued

The latest BofA Global Fund Manager Survey gives us a clear indication most institutional investors believe inflation has peaked. In such a scenario, being long 10 or even 30 year Treasuries makes sense and appears to become an overcrowded trade. While we believe the odds are high inflation has indeed reached a high, we would … Continued