Last week saw the failure of SVB Financial Group, the parent of Silicon Valley Bank. SVB is a commercial US bank that primarily serves technology and life science companies, with deposits significantly placed in US treasuries.
The UK’s reputation has suffered in recent years. Chaotic government, threats to repudiate international treaties, a diminished standing on the world stage – a preeminent 19th / 20th century power living on past glories, mired in nostalgia but unable to learn lessons from history.
There are stirrings on the political front. The resignation of Nicola Sturgeon as leader of the Scottish National Party (SNP) will have repercussions throughout the UK.
The UK is not in recession but nor are we growing. Q4 growth was zero, having fallen 0.3% in Q3. Not a technical recession – that is yet to come. The breakdown was a bit mixed. Surprisingly, fixed investment was up 1.5%, contradicting the downbeat nature of recent surveys.
There was a smell of spring in the air last week. Snowdrops and crocuses are out and there is a growing sense that the worst of winter is behind us.
My wife is an archaeologist. When in social gatherings her job has always garnered more interest than mine, which in noisier atmospheres is often heard as fun manager.
One question that I get asked a lot at the moment is that if I expect recessions in many of the leading economies, why am I positive on credit?
2022 was a traumatic year for financial markets – but this is something we are getting used to. Fixed income markets were the main casualty with both government and credit bonds taking a battering.
Is the UK heading for a housing crash? Last week saw the Halifax house price index decline by 2.3% in November, confirming the fall reported earlier by Nationwide.
Last week was all about interest rate decisions. Strangely, although the Federal Reserve (Fed), Bank of England (BoE) and European Central Bank (ECB) all increased rates by 50bps there was quite a bit of divergence underneath.
Sometimes markets see what they want to see. The interpretation of the latest statements from the Chairman of the Federal Reserve (Fed) was a case in point.
Michael Dobbs, author of House of Cards, would have been hard pressed to come up with the story lines that have played out in the UK in the last few months.
The Blame Game has started. Who should be held responsible for the shambles of last week? Let’s look at the suspects.
After a big build up, the week came to something of a disappointing end for some. While it was a fantastic event, Roger Federer’s last professional career match ended in defeat for him.
While relatively very few of us will have known or have met her, Queen Elizabeth’s passing and the dawning of the Carolean era is momentous.
There was a big rise in UK government bond yields last week, reflecting the inflation data which came in above expectations.
“It never rains but it pours”. A strange saying and metrologically inappropriate at this time. But the gist is that misfortunes come at the same time. The recent heatwave in Europe is a good example.
The Bank of England (BoE) hiked UK bank rate to 1.75% last week, meeting expectations of a 50bps move. The immediate reaction in the market was to take bond yields lower. Why was this?
It may seem like a strange question, but why should fund managers continue to pay attention to third-party investment strategists whose views have not worked out as expected?
I have committed to writing a maximum of 1,000 words in my weekly journal. It should take 5-7 minutes to read – so, by the time you finish reading this, the UK will have incurred about £1.5m in additional debt, equivalent to over £5,000 a second.