“This abnormal aversion to risk may be the worst legacy of the crisis. The reason why US companies do not use their extremely high profits – and stock market valuations – to invest, open up new markets…but rather to buyback their own shares and further boost their share price and bonuses.”
Market timing has long been the holy grail for investors, and evidence suggests that it works but might be a tricky game to play.
Caixin | Until recently, Chinese officials could rest assured that their path on the bureaucratic ladder went only upward, unless they were punished for some reason, usually corruption. No more. A policy passed in June 2015 by the Communist Party’s second-highest decision-making body, the 25-member Politburo, stipulated that officials should be demoted for failing to meet the requirements of their post.
James Alexander via Historinhas | As the FOMC increasingly avers that it is data-driven the demand to have better data has led to greater focus on aggregated current data. Whether the FOMC really looks at it, given it is ignoring its own Labour Market Conditions Index, is hard to say.
Caixin | Moving into the third year since the central government reinvented the borrowed notion of public-private partnerships (PPP) to encourage private investment, local authorities have announced thousands of projects that are to be funded through such a scheme.
The massive release of the Panama Papers has rocked the financial and political world. The leaked documents from Panama’s Mossack Fonseca law firms contain more than 11 million files involving 214,000 companies set up over the last four decades.
UBS | S&P 500 consensus expectations call for -8.1% earnings growth in 1Q2016, the largest decline since the Financial Crisis. While results should beat as usual, YoY forecast declines for 7 of 10 sectors make it unlikely that positive price reactions to “better than expected” will be an upside catalyst for the broader market.
The Panama Papers may have a similar historic reach as the Pentagon Papers, marking the point of no return for reducing the list of countries which protect and promote the lack of fiscal transparency. Tax cooperation between countries with automatic exchange of information (not on request) by all the tax offices does not allow for delays.
James Alexander via Historinhas | I remain a bit disappointed that Euro Area QE and negative rates are not proving more of a hit with the markets and thus the economy. But are things really as bad as painted by our friend Lars Christensen?
The jobless rate in the Organisation for Economic Co-operation and Development (OECD) remained stable in February compared to January at 6.5% of the active population. By regions, the Eurozone had the highest unemployment rate at 10.3%.