World Bank

  • 14 Jul
    As The S&P 500 Reaches New Highs, Asset Inflation Continues

    As The S&P 500 Reaches New Highs, Asset Inflation Continues

    • All factors are indicating an artificially created asset inflation.
    • Earnings are expected to decline with economic outlook being constantly revised downwards.
    • Gold is gaining alongside stocks which confirms that all assets are inflated.

    Introduction

    Amidst all the turmoil from BREXIT, negative interest rates and global downward economic growth forecasts, the S&P 500 has reached a new high. On Monday it closed at 2,137.16 points, overtaking the previous high of 2,130.82 from May 21, 2015. The Monday record was surpassed again on Tuesday and Wednesday, with Wednesday closing at 2,152.43. More →

  • 13 Jul
    Negative Yielding Debt: A Party for Investors or Pure Stupidity?

    Negative Yielding Debt: A Party for Investors or Pure Stupidity?

    • Almost 30% of global sovereign debt comes with a negative yield.
    • The situation is much worse in Japan and Europe than it is in the U.S.
    • Investors should enjoy the asset inflation party while it lasts but also be prepared for the worst.

    Introduction

    Negative yielding debt seemed impossible and illogical for a long time, but it suddenly became a reality a few years ago and now we are seeing it slowly become the new normal.

    This isn’t just strange, it’s dangerous as risk averse investors—like pension funds and insurance companies—are forced to invest in assets that have traditionally been considered safe but that have now become risky, and their returns minimal. Those low returns will result in lower pensions and lower savings which will create new troubles in the future. More →

  • 09 Jun
    Forget About The November Elections – This Will Impact Your Investments Even More

    Forget About The November Elections – This Will Impact Your Investments Even More

    • Slower global growth will have a much stronger impact on corporate earnings than interest rate increases.
    • US productivity is declining and GDP growth is based on increased consumption amidst cheap financing.
    • Corporate earnings are the source of your investment returns, and the picture is not one of growth.

    Introduction

    Amid all the fuss around interest rates, Yellen, jobs, Clinton and Trump there is one piece of information that is very significant for investors but is often disregarded. More →