Fixed Income

This week we present our Portfolio Allocation Summary for December 2022.

European inflation will decline through 2023, which will greatly help households and consumption. But can European inflation remain low after that?

Recession is not yet fully priced in, so markets have further to fall next year. But watch for a buying opportunity in the second half.

The S&P 500 is down by 17% year to date, while our portfolio is up 15%. US political analysis is essential for investors but it is best done by geopolitical method rather than Washington punditry.

This week we present six key investment views for 2023.

Crypto broker FTX’s bankruptcy does not pose a systemic threat to markets. It did reveal something deeply unflattering about excess liquidity, however, and suggests that other private investments may come a cropper.

Today, we are sending you the BCA annual outlook for 2023. The report is an edited transcript of our recent conversation with Mr. X and his daughter, Ms. X, who are long-time BCA clients with whom we discuss the economic and financial market outlook for the next twelve months toward the end of each year.

Excess job vacancies in the US and UK reflect a labour market that cannot efficiently match unemployed workers with vacant jobs. This is because excess job vacancies reflect the shortage of labour supply in the 50 plus age cohort, whose skills are difficult to replace. In economic jargon, the post-pandemic ‘Beveridge curve’ has shifted outwards. Absent an unlikely shift in the Beveridge curve to its pre-pandemic version, killing US wage inflation will mean killing jobs. And killing jobs will mean killing profits. We go through the investment implications.