Stocks likely have further to sell-off but when should you look to buy-the-dip?🚨Despite the S&P 500 being down 23% YTD - stocks are far from cheap according to one indicator (never just use one indicator).The Shiller CAPE Ratio which measures the P/E, has declined by ~20% in the last 6 months falling from: 39x at the 2021 peak —> 29x today.However, if you look historically, this is far from cheap. The dot-com bubble peak for example, stocks traded at a 44x, eventually falling to 21x in 2003 after the crash. Again not massively cheap. At current levels, we should be trading at roughly 10x if you look at the chart below. This would mean a drawdown of 50% if core inflation stubbornly stayed at this level of 5.4% - not my view.On the flip side if you *didn’t* invest from 2018 - 2022 bec

THE BOJ IS ABOUT TO OWN HALF OF THE JGB MARKET...The Bank of Japan (BoJ) will most likely be the first major centralbank to own more than 50% of its own bond maket (the BoJ currently owns 49.2% of the JGB market). The boe comes next with nearly 39% of Gilts. The BoJ could pass the 50% threshold as early as this week. That would be crossing the Rubicon. The private sector in Japan is already very overweight JGBs and underweight equities. Inflation has recently surged to a 10-year high, and further falls in the yen promise to pressure inflation yet higher. Ownership-concentration risks mean that any sign that inflation is getting out of control would likely prompt an exodus from JGBs into to more inflation-resilient equities.Owning half the JGB market is a potential tipping point that could

BREAKING: Auto-loan DEFAULTS are increasing - warning for the global economy 🚨The CFO of one of the world’s largest car manufacturers Ford Motor Company has just made a short comment with BIG implications.Why is this important?Auto loans are already the third largest consumer credit market in the United States at over ~$1.4 trillion outstanding, double the amount from 10 years ago.This is particularly bad news for auto manufacturers with high amounts of auto-loans outstanding.Let’s walk this particular example through: Recessionary Consumer Confidence + Record Fuel Prices + 40-year high Inflation —> Auto-loan delinquencies —> Lower Auto-demand —> Lower Manufacturing Output —> Corporate Lay-offs —> Higher Unemployment —> Lower Economic Activity —> RecessionThis could be

The ecb is finally joining the club of central banks hiking rates with its first hike since 2011. The ECB raises the main refinancing rate by 50bps to 0.50% and depo rate from -0.5% to ZERO (more than they guided). ECB also unveils a new crisis tool called Transmission Protection Instrument (TPI - details will be released after the press conference). The ECB crisis tool purchases are not ‘restricted ex ante’. Further hike will be done in the next meeting(s). Forward guidance dropped due to risk inflation outlook => now each meeting is live and data dependantOur take: -  Overall, this ECB meeting is more hawkish than expected and was not an easy option for Mrs Lagarde as the eurozone is facing two additionnal risks on top of record high inflation: 1/ the risk of an energy shock

声明 |本文为斯隆研究员个人学习笔记，不构成投资建议，与任何组织均无关。想着要对今年的经济和资本市场做一个半年总结，总是有点萧杀秋风扫落叶的感觉。股市、政府债券和数字货币尽皆下跌。今年的特殊通胀环境里，从全球看，传统的“股票/债券”配置也几乎完全失效，业界在感叹和讨论股债双杀。2022年代通胀的恶魔之手，不知不觉中伸向了经济与资本市场的角角落落。它带来了与1970年代有着本质不同的加息风险，当然也预示着其他替代加息的方案。它的背后是正在加深的能源危机。它挥一挥衣袖，世界的裂痕暗流涌动。为了与之抗衡，欧洲使出了不少解数。而依然高估值的美元，暂时能强势笑对通胀和经济衰退。加息风险要理解通过货币政策管理本轮通胀和经济衰退之难，就必须了解现今的经济环境，与1970年代有何不同。1970年代，央行们通过承诺和实施加息，来管理通胀的预期和通胀率。在那个央行独立性得以充分确保的时代，货币政策制定者们对平衡通胀所需要付出的代价——比如，最终将对总产出和就业的影响，相对没有什么顾虑。是的，1970年代，发达国家央行们带头控制了通胀，但在大温和大稳健时期的另一面，全球经济也为此付出了巨大的代价。最突出的例子就是，1980年代在拉丁美洲产生的债务危机，给世界带来了持续20年的负面影响。更重要的是，虽然都处于能源危机的背景，1970年代的油价暴涨除了起源于与今天类似的战争和供应不足，主要也有石油公司和消费者持续的拼命抢购和疯狂的囤积行为的贡献。反观现今的通货膨胀，包括油价上涨的主导因素在内，都更多地与供应不足有关——对于当今全球经济的症结和所处的趋势，学界和业界有着长时间的争论，最终在供应问题是根本原因，并很可能因此产生衰退和经济危机等问题上达成了一致。包括世界银行的最新全球经济展望报告，以及至今有表达过观点的诺奖经济学家们，在这方面都达成了共识。在我的分析笔记《扭转全球通货膨胀》中，载

While this does reflect a challenging macro-market backdrop, the upside of this is that when you see a crash in IPO activity it often means a bottom is near (albeit note the almost 2-year long IPO winter in 08/09!).It does reflect market sentiment, but at the margin it also reflects supply: at the end of the day it’s all supply & demand. If the supply of new IPOs goes down then at the margin that helps the overall stockmarket supply vs demand balance.All of this is not a new phenomenon — the chart below provides some longer-term perspective. The cycle of market booms and busts can be clearly traced by the ebb and flow of IPO activity.

博客 | 吴家琦 (Jiaqi Wu)，斯隆学者 (Sloan Fellow)，师从于 A. Michael Spence 和 Robert W. Jenkins。A. Michael Spence 执教全球经济与新兴市场经济学以来的经济学论文最高分得主；意大利SDA博科尼商学院经济学全系第一。伦敦商学院 Andrew J Scott 最佳斯隆经济学论文；伦敦商学院斯隆经济学全系第一；伦敦商学院资产管理课程全校第一。 声明 | 本文为斯隆研究员个人学习笔记，不构成投资建议，与任何组织均无关。 相关文章 | 我在全球通货膨胀的恶魔之手聊了全球经济与资本市场的风险，预言了美元的疯狂走强。更早之前，我也在扭转全球通货膨胀分解了通货膨胀的根本症结不仅是利率问题，更是全球供应链问题。这些分析均可相互支持和引证，环环相扣。你如果对世界金融市场的根本机理感兴趣，欢迎阅读。 * 美元处于20年来的最高水平。新兴市场股票的表现将在很大程度上取决于美元指数在未来几个月的表现。如果美元指数继续走强，那么新兴市场将陷入困境。 也许，对于20世纪70年代和80年代的滞胀*来说，令人宽慰的是，它毕竟是短暂的，只有一年左右。然而我们不能如鸵鸟般直接把头埋在土里一年，去不负责任地忽略滞胀将带来的可怕后果。因为从另一方面来说，滞胀最令市场恐惧的事情是，随着全球央行们完成约束性政策转向，世界经济很快就会进入全面衰退*。 现今，全球的主要经济体正在以不同的速度重蹈历史的覆辙，处于从2022年短暂的“经济滞胀”向2023年起持续时间和运行深度均难以预测的“全面衰退”过渡。这样的过度一般需要几个月时间，直至美联储政策最终达到约束性状态（3.5%)，以及欧洲央行的中性被落地。届时，由于经济衰退的正式到来，预

The Market is currently pricing in continued Fed rate hikes through year end (to 3.25%-3.50%) but then a sharp reversal in policy with rate cuts already in 2023."US inflation may be close to a peak, but it's very likely to stay above 8% through year-end. Bloomberg Economics' model assigns zero probability to a drop below 4% in 2023.' Sure, at some point we'll see peak inflation, but that doesn't mean inflation will fall below 4% or suddenly, miraculously, return to around 2%.The market is expecting inflation of 4-6%, so what's to stop the Fed from raising rates to 4.5-5% instead of the 3.25-3.50% expected now?

When compared to the established big players in digital ads, namely $谷歌(GOOG)$ and $Meta Platforms(META)$, that's small potatoes — Google Search alone brought in almost $150bn last year, and Facebook did more than $110bn.If those reports prove accurate, Tiktok will have broken the $10bn a year mark in just its sixth full year — a milestone that took Facebook more than a decade. YouTube took 14 years. Snapchat and Twitter? They're both barely halfway to that milestone.Bytedance reportedly made $34bn last year, less than a decade since it was founded".Source: Chartr

Highlights the swings of small business concerns is illustrative of how CEOs must face a constant blend of challenges across cycles …. now, inflation and labor is at the top of the Hot List … at times, it is taxes or government. But … there are always taxes and government … what is unusual is the extended economic growth and tight labor supply during inflation ….The goal is to avoid stagflation. Perhaps labor rebalancing will be a lagging indicator following the income diluting effects of inflation …. And if this is the case naturally as firms do slow hiring, if there is anticipated energy (or even caps globally), and labor rebalancing then how far should the government banks go to “force” price stability? Of course in monetary policy, banks in the large economies can act, but the emerging

博客 |吴家琦 (JiaqiWu), 斯隆学者 (Sloan Fellow), 师从于诺贝尔经济学奖得主A. Micheal Spence.A. Micheal Spence Best Economics Paper at SDA Bocconi MBA; Andrew Scott Best Sloan Economics Paper at London Business School.声明 |本文为斯隆研究员个人笔记，与任何组织均无关近期，高度通货膨胀和低增长将全球经济再度拖入了危机。这是继新冠疫情经济衰退——二战以来最严重的经济衰退——之后，世界人民又一度面临的艰巨挑战。即使经济的衰退可以避免，滞胀也将对中低收入国家带去长久的阵痛。危机根据世界银行最新公布的数据，2022年全球经济增长将从前一年的5.7%暴跌至2.9%。请注意，发展中国家并未能幸免于难。2022年发展中国家的经济增长也将仅有3.4%，这个数据仅为2021年的一半。总等收入国家的总量增长也将放缓1.3个百分点。5 月，美国的消费价格指数年通货膨胀率为 8.6%，是近几十年来正常水平的四倍，并且超过了工资增长。即使是核心通货膨胀率也达到了 6%，高于其他主要经济体的水平。60 岁以下的美国人在他们的成年生活中，从没有经历过这样的事情。更令人不安的是，这次的全球经济挑战将更为沉重。因为目前全球公共负债占GDP比重已经达到了350%。这意味着货币政策如果快速正常化和利率上升速度过快，将促使高杠杆的家庭、公司、政府和金融机构陷入破产和违约。同时，已然高举的公共债务还将限制财政扩张的空间，全球各地政府财政支出的弹药和央行的货币调节都在变得不可持续。在这些债务中，大部分债权属于私人债权人，并执行随时可能飙升的

The Energy crunch in Europe1) Energy induced Recession = lower EUR2) Recession Risk = higher credit spreads and peripheral spreads = lower portfolio inflows3) Higher cost of manufacturing, shortage of key supply chain materials increase inflation pressure and growth pressure4) Factory shutdowns = potential higher unemployment Essentially the Euro area's cost of energy is 3-4 times higher than that of the US and this key disadvantage for Euro manufacturing requires a weaker currencyECB can make all the noise they want on FX but with 214bps priced over 2yrs already - not really much they can speak up.Is USD parity Around the corner?

Default mortgage rates in the US at highest level since 2009 (WSJ). Homebuyers in China boycott mortgage payments (Forbes). Australian homeowners relegated to mortgage hell,Will we see more of these headlines soon? Homeowners who bought during the pandemic are being hit from all sides as their mortgage payments rise, property values fall and daily expenses soar. And for those whose fixed-rate mortgages are now expiring after 5 or 10 years (see chart), the follow-up financing will be really expensive.My guess is that we will be dealing with this for a long time to come. With negative effects on the stock and interest rate markets.

Volatility Is Calmer Than During Other Stock Bear MarketsUS stockmarket volatility, while elevated, is far off levels usually observed during other powerful bear markets. The Cboe VIX Index hasn’t crossed the 40 points mark since the latest selloff began, something unseen over the past two decades. Even during the slow market decline following the bursting of the dotcom bubble in the early 2000s, volatility spiked higher on several occasions…

IFM (an Australian Pension Fund) has announced a mandatory takeover of Vienna Airport at €33.00 per share having crossed the 40% threshold, but is not seeking a majority given the large stakes held by the local government who are unlikely to sell.IFM had already led the acquisition of Sydney Airport, held a cornerstone stage in Vienna Airport, and had made a previous bid for the company.Yet, Vienna Airport had almost no mainstreaming investment bank coverage, the stock is illiquid and there are extra withholding taxes because of the Austrian listing.There is plenty of alpha for those willing to explore the path less traveled.

The following chart depict the Nasdaq 100 Index from 2006 until today. This time horizon was chosen to include the GFC crash. The technical indicator that was used is the Ichimoku Kinkō Hyō. The Ichimoku Kijun sen throws up some very interesting insights:1) The Kijun is simply the highest high to lowest low midpoint of the last 26 periods. In this case 26 periods refer to 26 months.2) In the recovery phase after the 2008-2009 crash readings climbed above the Kijun sen in September 2009. After this occurance all subsequent corrections took support at the same line or slightly above it before the rally resumed.3) Starting from febuary 2016, there were 4 occasions (including the current one) when the monthly candle broke the Kijun via a bearish candle, but not in a single instance was the clo

The share of distressed high yield debt (debt trading wide of 1,000 bps) is above 5% as of mid-June (white dotted line) and climbing steadily amid uneven macroeconomic data and rising recession concerns. The climb, however, remains concentrated with consumer staples (blue line) among the biggest propellants.Distressed cycles typically peak north of 15% as a share of total high yield market value, implying scope for material continued widening should recession risks intensify.

When Does The Recession Begin? Here Is What Wall Street Thinks (source: DB Jim Reid). 71% say 2023, 17% say 2022 and 6% say it's already started. Also worth noting: just 8% now expect no recession until 2024, down from a near majority (45%) in February.