Outlook 2H 2015   Behind every forecast is a melee of competing ideas and arguments. Behind the veil of confidence is a dialectical process of self-questioning and reinforcement, and often, self-doubt. Behind every investment strategist is a risk manager acting as goalkeeper, and a trader dodging and weaving around short term volatility, avoiding the thousand

The rights and obligations of principal and agent need to be properly defined, particularly in complex business like banking and finance. Five banks have recently been fined $5.5 billion over a rate manipulation scheme that has seen them not act in their clients’ best interest. A bank should be clear about whether it trades as

On Monday, 18 May, Jiangsu province successfully sold 52 billion RMB of municipal bonds.   Recently, the Chinese government has accelerated a municipal bond program that effectively is a debt swap for some 1.7 trillion RMB of existing local government debt. Cost of debt for the local governments is expected to fall by some 250-300

China is initiating QE lite mimicking the ECB’s LTRO programs. The objectives are clearly to lower borrowing costs for local governments, and to establish a liquid municipal bond market as part of a reorganization of the funding mechanism for local governments which until now had used opaque, off balance sheet, so-called Local Government Funding Vehicles

Why did German bunds selloff so violently? When the ECB announced QE, traders attempted to front run the program. The program would buy bonds according to the capital subscription of the national central banks to the ECB. On that count, bunds would see an 18% allocation of the budget, France 14%, Italy 12% and Spain