Browsing: The Global Economy & Currencies

The Global Economy & Currencies

The Case for Bargain Hunting in South Africa

Apr 18th, 2017 | Filed under: Currencies, Emerging markets, Newly Added, The Global Economy & Currencies

Charles Roth, of Thornburg Investment Management, has made the case that markets have over-reacted to the recent political shake-up in South Africa, driving asset prices below their underlying value. Thus (although Roth doesn’t put the point quite this bluntly) this could be a time for some bargain hunting.  Finance MinistryRead More


Nation-States and Block-Chains: Vying for the Cutting Edge

Mar 21st, 2017 | Filed under: Currencies, Forex, Newly Added, The Global Economy & Currencies

Deloitte proposes that the Swiss Confederation has a key role to play in the continued development of blockchain. In a new whitepaper, Deloitte makes this case based on Switzerland’s “special position as a global innovation centre.” There are six sides to Switzerland’s position: its FinTech infrastructure; its start-up attractiveness; itsRead More


Looking at a Continent: Stress-Testing Banks and Insurers

Mar 14th, 2017 | Filed under: Economics, Finance & Economics, Newly Added, The Global Economy & Currencies

The European Central Bank’s financial stability review, published in November 2016, predicts “steady, but modest, euro area economic recovery, despite continued headwinds.” The review is designed to assist Europe’s policy making authorities by providing information about the bank’s microprudential and macroprudential roles, along with the risks and vulnerabilities of theRead More


On the Bitcoin Blockchain: Looking Under the Hood

Jan 19th, 2017 | Filed under: Algorithmic and high-frequency trading, Business News, Currencies, Digital currencies, Emerging Alternative Investments, Finance & Economics, Newly Added, The Global Economy & Currencies

More than a year ago, the Capco Institute Journal of Financial Transformation (Journal) ran a “critical assessment,” by Robert Sams, of bitcoin blockchains as a means of distributed clearing. With both bitcoins and blockchains newly in the news, Sams’ informed assessment is worth another look. Two years ago, Nasdaq announcedRead More


The Federal Reserve on Distributed Ledger Technology (that is, on Blockchains)

Jan 5th, 2017 | Filed under: Finance & Economics, Newly Added, Operations, Risk Management & Operations, The Global Economy & Currencies

A large team of officers and staff affiliated with the Federal Reserve (eight with the Board in DC, five with the FR Bank of New York, one with the FRB of Chicago) have collaborated on a new paper on distributed ledger technology in payments, clearing, and settlement. Of necessity, givenRead More


Natixis asks 500 institutional investors to look into the future

Dec 20th, 2016 | Filed under: Allocating to A.I., Emerging markets, Finance & Economics, High-net-worth investors, Institutional Asset Management, Newly Added, The Global Economy & Currencies

Natixis Global Asset Management has released the results of a survey of 500 institutional investors, asking them their views on prospects for 2017. The surveyed institutions expect that political and economic developments could cause an increase in volatility in the year to come, and active managers have to reset theirRead More


Private Equity Placements in China

Dec 8th, 2016 | Filed under: Allocating to A.I., Benchmarking & Performance Attribution, Currencies, Emerging markets, Newly Added, Private Equity, Private Investments, The Global Economy & Currencies

A new paper by G. Nathan Dong and two other scholars investigates private equity placements in China and their consequences for the issuing firms. The study works from a natural experiment that resulted from regulations created by the PRC ten years ago. In 2006, the China Securities Regulatory Commission issuedRead More


Aftermath of 2008: Reactions to Decreased Liquidity

Nov 20th, 2016 | Filed under: Finance & Economics, Liquid Alternative Investiments, Liquid Alts, Macroeconomics, Newly Added, Other Topics in A.I., Regulatory Environment, The A.I. Industry, The Global Economy & Currencies

A new report from State Street Corporation and the Alternative Investment Management Association says that nearly half of the market participants surveyed believe that decreased market liquidity is a secular change, not a cyclical one: that is, that it is a climate that is here to stay, not a rainRead More


Massad: Where the U.S. and the World Stand on Margins & Cap Requirements

Oct 27th, 2016 | Filed under: Commodities, Finance & Economics, Forex, Investing in Commodities, Newly Added, The Global Economy & Currencies

The chair of the Commodity Futures Trading Commission, Timothy Massad, addressed the Outlook Conference of the Managed Funds Association on October 21, and spoke about the global implementation of uncleared margin rules, which he called a critical component of “the new regulatory framework for swaps trading that the leaders ofRead More


Venezuela: Thinking of Cromwell and Crude

Oct 13th, 2016 | Filed under: Commodities, Commodities: Examples, Emerging markets, Finance & Economics, Newly Added, oil, The Global Economy & Currencies

Hedge funds, among them some of those the unsympathetic call “vultures,” bought into the bonds of the Petróleo de Venezuela SA (PDVSA) early this year. PDVSA is Venezuela’s state-owned oil company, the consequence of nationalization forty years ago. Its fate turns on (a) the vagaries of post-Chavez politics in thatRead More


Papaconstantinou on ‘Selling the Family Silver’  

Oct 2nd, 2016 | Filed under: Business News, Currencies, Insolvency, Newly Added, The Global Economy & Currencies

A former finance minister of the Republic of Greece has published a book, Game Over, on what it is like to be in the midst of a continent-wide political and financial crisis. This is a volume that might be read with attention by those who seek alpha from distressed sovereignRead More


ESMA’s Greybeards Ponder Blockchains

Sep 11th, 2016 | Filed under: Algorithmic and high-frequency trading, Business News, Currencies, Digital currencies, Emerging Alternative Investments, Finance & Economics, Newly Added, Other Topics in A.I., The Global Economy & Currencies

There has been a flurry in recent days of activity about blockchains among the graybeards of the financial world, those who ponder the Really Big Picture and who have the ear of important regulators. Let us start from the beginning. What is a blockchain? It is a chronological, virtual, andRead More


The Next Crisis: BIS Warns of ‘Financial Vulnerabilities’ in EME/NFCs

Aug 25th, 2016 | Filed under: Currencies, Emerging markets, Finance & Economics, Macroeconomics, Newly Added, The Global Economy & Currencies

In a recent paper submitted to the G20’s working group on international financial architecture, scholars with the Bank for International Settlements have warned that an accumulation of debt in the years since the global financial crisis has left the emerging market economics (EMEs) vulnerable to capital outflows. The authors ofRead More


NB: China Positions the Yuan for Global Reserve Currency Status

Aug 9th, 2016 | Filed under: Currencies, Forex, Newly Added, The Global Economy & Currencies

Neuberger Berman, the asset management business spun off from Lehman in late 2008, has produced a new report on foreign access to China’s bond market. China has until now kept its bond market tightly fenced off from the rest of the world, which offers a marked contrast with the behaviorRead More


Stocks after Shocks: Equity Returns in the Face of Monetary Policy

Jul 31st, 2016 | Filed under: Economics, Finance & Economics, Financial Economics Theory, Newly Added, The Global Economy & Currencies

A new paper by two economists affiliated with the Federal Reserve System presents a new measure of the monetary policy exposure of individual stocks. The simplest approach to this task would be to regress individual stock returns around major central bank moves (“shocks”). But that turns out not to beRead More


Eurekahedge: Performance Down, Inflows Up in 1st Half 2016

Jul 28th, 2016 | Filed under: Equity Hedge Funds, Event-Driven Hedge Funds, Finance & Economics, Hedge Funds, Macro and Managed Futures Funds, Newly Added, The Global Economy & Currencies

The latest report from Eurekahedge indicates that hedge funds’ assets under management are up by $19.9 billion in the first half of 2016 worldwide. Eurekahedge, which tracks the health of the hedge fund industry month by month, also says that total industry performance-based results were down, $5.2 billion, so moreRead More


Volatility Spillover Effects: India, Korea, China

Jul 21st, 2016 | Filed under: Commodities, Currencies, Finance & Economics, Investing in Commodities, Newly Added, The Global Economy & Currencies

Last year, two scholars writing in the Journal of Alternative Investments looked at the volatility spillover effects in the Chinese stock index futures and spot markets.  The question for them was whether there is spillover from spot markets into futures markets and back. I propose to give you their answer,Read More


Brexit and Hedge Fund Strategies

Jun 30th, 2016 | Filed under: Currencies, Equity Hedge Funds, Finance & Economics, Hedge Funds, Newly Added, Relative Value Hedge Funds, The Global Economy & Currencies

How well did hedge funds help their investors to hedge potential losses as a consequence of the markets’ immediate reaction to the Brexit vote in the United Kingdom? How well will they hedge the other uncertainties going forward? Thursday, June 23, the UK voted to leave the European Union. TheRead More


Giving the Baron King of Lothbury his Due

Jun 7th, 2016 | Filed under: Business News, Finance & Economics, Insolvency, Newly Added, The Global Economy & Currencies

The Bank of England is not only the central bank of the United Kingdom, in continuous operation since 1694; it is the model upon which central banking worldwide has been created. The Mother Central Bank is what it is. Mervyn King, the chief economist of the Bank of England throughRead More


Global Focus Capital: Market’s Inflationary Expectations Are Too Low

May 12th, 2016 | Filed under: Allocating to A.I., Benchmarking & Performance Attribution, Commodities, Currencies, Finance & Economics, Macroeconomics, Newly Added, The Global Economy & Currencies

Investors can get ahead of events by aligning their portfolios to “a world of lower expected capital market returns and higher forward volatility.” That, at any rate, is the upshot of a thoughtful analysis by Eric J. Wiegel of Global Focus Capital, a Boston based asset allocation advisor. Why doesRead More


Escape to the Internet? Or Build Better Communities?

May 8th, 2016 | Filed under: Currencies, Digital currencies, Newly Added, Operations, Other Topics in A.I., Risk Management & Operations, Technology, The Global Economy & Currencies

Dissatisfaction with the fiat money issued by or on signals from central bankers will not go away. Talk of “printing press” money seems quaint, as when people of my generation still refer to a keyboard as a “typewriter.” Central banks and their servants (and their servers) around the world engage,Read More


Greek Debt: Back in the Headlines

Apr 4th, 2016 | Filed under: Business News, Finance & Economics, Insolvency, Newly Added, The Global Economy & Currencies

The issue of Greece’s insolvency had receded a bit from the headlines since the stormy days of last summer. Alpha-savvy readers will surely recall, though, that in July 2015, the Greek government and its European creditors reached a bailout agreement that required actions by the former, especially on pensions andRead More


Where We Stand With Blockchains: Bet on the Disruption

Mar 29th, 2016 | Filed under: Currencies, Digital currencies, Emerging Alternative Investments, Finance & Economics, Newly Added, Other Topics in A.I., The Global Economy & Currencies

Chris Skinner has a new book out, ValueWeb, which describes in the words of its lengthy subtitle “how FinTech Firms are Using Bitcoin Blockchain and Mobile Technologies to Create the Internet of Value.” It may appear to a cynic that Skinner is simply entering the already crowded sweepstakes for “whoRead More


The ECB’s March Announcements:   Some Facts and Some Philosophy

Mar 27th, 2016 | Filed under: Currencies, Macroeconomics, Newly Added, The Global Economy & Currencies

On March 10, the European Central Bank announced an eagerly awaited new round of stimulus measures. This fell flat, and it has left some people wondering whether the bazookas of the central banks have become pop guns. As Andrew Bosomworth put it, in PIMCO’s blog, the ECB ”ticked all theRead More


Cross-Border Insolvencies: Defection Isn’t the Only Problem

Mar 17th, 2016 | Filed under: Business News, Economics, Finance & Economics, Newly Added

A recent paper by Andrew Dawson, a law professor of the University of Miami, looks at the current cross-border insolvency framework from the point of view of the cultural differences that may be expressing themselves through the distinct systems on the opposite sides of many an international border.  His discussionRead More


FCStone Financial on Grains and Volatility

Mar 10th, 2016 | Filed under: Commodities, Commodities, Commodities: Examples, Finance & Economics, Forex, Investing in Commodities, Newly Added, The Global Economy & Currencies

A new white paper written by Arlan Suderman, chief commodities economist for INTL FCStone Financial, discusses the consequence of the strong dollar of the last two years on the volatility of grain prices, focusing especially on corn. Before this period, there was the global financial crisis, and the “quantitative easing”Read More


Latest News on Argentina and the Pari Passu Clause

Feb 25th, 2016 | Filed under: Business News, Emerging markets, Finance & Economics, Insolvency, Newly Added, The Global Economy & Currencies

The Hon. Thomas Griesa, of the U.S. District Court for the Southern District of New York, has issued an “indicative ruling” in response to a motion by the Republic of Argentina.Read More


Carry Strategies: Beyond Foreign Exchange

Feb 21st, 2016 | Filed under: Commodities, CTA, Currencies, Forex, Hedge Funds, Macro and Managed Futures Funds, Newly Added, The Global Economy & Currencies

International investors borrow money in countries where interest rates are relatively low, and then lend it out in countries where the rates are higher. All they do is “carry” the money, so to speak, from one country to the other.Read More


The Bonds of War: Ukraine, Russia, the IMF

Feb 11th, 2016 | Filed under: Business News, Finance & Economics, Frontier markets, Insolvency, Newly Added, The Global Economy & Currencies

Argentines take heart. Yes, you have implacable holdout bondholder NML Capital to contend with, and NML has been beating you in court battles arising from your 2001 bond defaults. But … Paul Singer isn’t Vladimir Putin, and NML isn’t Mother Russia. Your courtroom battles aren’t actual battlefield battles. The defaultRead More


CFDs and Their Platforms in Germany

Jan 20th, 2016 | Filed under: Currencies, Forex, Newly Added, The Global Economy & Currencies

FXCM, an online provider of foreign exchange trading related services, announced January 6 that it has entered into a partnership with a German broker, FXFlat, as part of its strategic expansion into the German market. The immediate consequence of the partnership is that FXFlat’s customers can access the FXCM TradingRead More


Nasdaq Puts Its Forex Plans on Hold

Jan 18th, 2016 | Filed under: Currencies, Finance & Economics, Forex, Newly Added, The Global Economy & Currencies

There is an ancient principle of prudence, “don’t fix what isn’t broken.” Thomas Jefferson alludes to it in the Declaration of Independence. Prudence dictates that institutions “long established” are not abandoned for “light and transient causes.” It is possible that many of those who trade currencies today believe that theRead More


Emerging Markets in 2016: Making Necessary Distinctions

Jan 3rd, 2016 | Filed under: Currencies, Emerging markets, Finance & Economics, Newly Added, The Global Economy & Currencies

The present depressed state of commodity prices spells continued trouble for those companies that export said commodities, but also spells opportunity for those that import and make use of them. Some thoughts from Neuberger Berman, with an addendum from BlackRock. Read More


Bitcoin’s Founder: Recent History and 2020 Vision

Dec 17th, 2015 | Filed under: Currencies, Digital currencies, Emerging Alternative Investments, Entrepreneurs, Finance & Economics, Newly Added, Personalities in AI, The Global Economy & Currencies

Two things happened almost at once recently: Wired told us who actually invented bitcoin, (well, it gave the world the latest hot theory), and officials in Australia raided that same fellow’s home in re a tax investigation. More specifically on the first of those points, Wired (and soon thereafter Gizmodo)Read More


India: The Way Up and the Way Down Are Not the Same

Nov 26th, 2015 | Filed under: Finance & Economics, Financial Economics Theory, Newly Added, Other Topics in A.I., Risk Management & Operations, Risk Management Strategies & Processes, SRI and Clean Energy, The Global Economy & Currencies

Faille doesn't mean to argue theology, but he has to observe that a Shariah-based understanding of what constitutes “ethical investing” entails a lot of premises, and if those premises are to be inserted into reasoning about financial economics, they have to bear up to empirical, secular scrutiny. Read More


Hedge Funds in a Time of Weakening Recovery

Oct 27th, 2015 | Filed under: Alternative Investments in Context, Finance & Economics, The Global Economy & Currencies

Though the recovery is showing signs of its age and weakness, this is still not the day for which tail-risk funds were designed, the moment of 'extreme distress' and victorious black swans. Thank heavens for that fact, and thank Eurekahedge for the news. Read More


An Official Keynesian Reading of Cap Inflows and Emerging Markets

Oct 18th, 2015 | Filed under: Emerging markets, The Global Economy & Currencies

Olivier Blanchard has just stepped down as the chief economist of the International Monetary Fund, a post he has held since 2008. Faille looks at a new article that may be considered his parting shot from that parapet.Read More


New Route for China’s Investors to the Rest of World

Oct 6th, 2015 | Filed under: The Global Economy & Currencies

China has a classic central-planners’ economy, and planners hate to lose control. As a logical consequence, the central authorities have only very slowly loosened their grip either on money coming in from outside or on money going out from inside. Still .... Read More


Why is Japan’s Recovery So Sluggish?

Sep 23rd, 2015 | Filed under: The Global Economy & Currencies

As two IMF economists see it, the trend toward the outsourcing of manufacturing by Japanese firms has a downside for the domestic economy, which has become less resilient than it once was. This explains why the familiar nostrums aren't working. Read More


Blame China; Blame the US Fed, whatever … August Hedge Fund Numbers Stunk

Sep 21st, 2015 | Filed under: Structure of the Hedge Funds Industry, The Global Economy & Currencies

Eurekahedge's latest round-up of hedge fund results by strategy and region makes quantitative what you, dear reader, probably knew: August was bad. The report also includes some discussion of HK/Shanghai arbitrage. Read More


Japan: Richardson makes a Tricky Case

Sep 9th, 2015 | Filed under: Currencies, Forex, Indexes, Institutional Investing

The Japanese economy deserves some credit for having pulled itself out of a recent recession, and it is "beginning to show signs of benefiting from a weaker yen" as a BlackRock strategist tells us. But (there is always a "but"). Read More


Javert Frustrated Again: This Time in the Second Circuit

Sep 8th, 2015 | Filed under: Emerging markets, Insolvency, Legislation/Court rulings

NML tried to get around the sovereign immunity of Argentina's Central Bank by arguing that it and the Republic were only one entity (the "alter ego" theory developed by the U.S. Supreme Court in an opinion concerning Cuba, in the 1980s), and that the one entity involved has waived its/their immunity. No dice. Read More


What Taper Tantrum?  And, Will Yellen Pull a Bernanke?

Aug 30th, 2015 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Indexes, Macroeconomics

The head of the New York Fed said on Wednesday, August 26th, that "the decision to begin the normalization process at the September FOMC meeting seems less compelling to me than it was a few weeks ago." We may be about to see another Fed retreat, analogous to that of a little more than two years ago. Read More


Study Says The Gold Bugs are Right

Aug 23rd, 2015 | Filed under: Currencies, Forex, Gold, Hard metals, Risk management

Gold seems, to a larger extent than silver, and even more so to an extent larger than is true for palladium or platinum, to work as a true financial asset: decoupled from price developments in the commodity markets. It succeeds as a hedge against currency and stock-market trouble.Read More


Eurekahedge: The Markets are Reading the Headlines

Aug 18th, 2015 | Filed under: Alpha Seekers, Alpha Strategies, Commodities, CTA, Currencies, Hedge Fund Strategies

In the three month period that ends with July, Eurekahedge’s Greater China Index (which has 85 constituents) is down 9.39%. That has come about for precisely the reasons that a reader of the pertinent headlines would guess. Read More


Another Southeast Asia Currency Crisis

Aug 17th, 2015 | Filed under: Currencies, Emerging markets, Forex

China's moves in recent days seem likely to set off a new Southeast Asia currency crisis, which will look a lot like the old Southeast Asia currency crisis. This was clear even on August 11th, when traders in the rest of the world were apparently working on the premise that China's move that day was a one-off. Read More


Commodities & Currencies From May to August: How Much Has Changed

Aug 12th, 2015 | Filed under: Commodities, Currencies, Insolvency

What a difference a summer makes! In May of this year it was still taken for granted that the "normalization" of Federal Reserve policy and so of U.S. interest rates approached. Now, that cannot even remotely be taken for granted.Read More


The LIBOR Fixing Scandal Gets a Conviction and a Book

Aug 9th, 2015 | Filed under: Currencies, Derivatives, Forex

When it all hit the fan, U.S. investigators in particular (the Brits somewhat less so) came to see Hayes as a mastermind behind its digestive generation. But Arvedlund seeks in her new book on the Libor Rigging scandal to place the role Hayes played in context. Read More


The Varoufakis Tape: Part Two

Aug 4th, 2015 | Filed under: Currencies

Faille returns to the matter of a recorded conversation in which a former Greek finance minister talked about German ideas that ought to have the French government worried. Specifically, it is allegedly Werner Schäuble’s intention to scare the French into abandoning sovereignty. Greece is just a pawn. Read More


The Varoufakis Tape: Part One

Aug 3rd, 2015 | Filed under: Currencies

In a newly released recording (of a conversation apparently intended to remain secret somewhat longer), the former finance minister discussed the cloak-and-dagger task force that had drawn up plans for a Grexit. And, looking forward, he talked about German ideas that ought to have the French government worried.Read More


Overtrading and the Danger of Pro Rata

Jul 30th, 2015 | Filed under: Algorithmic and high-frequency trading, Commodities, Currencies, Derivatives, Forex

Guest columnist Ginger Szala looks at pro rata and what happens if...Read More