Economic and Market Outlook 2009
Thursday, 22 January 2009 | 12:00 am
Economic data is pointing towards a worsening global recession in 2009. The scale of the slowdown in economic activity, the damage done to the banking system, the losses accumulated in residential real estate and the impairment of household balance sheets call for extraordinary policy measures. A more or less global though not entirely concerted policy
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Inflation Deflation
Tuesday, 06 January 2009 | 11:45 am
In my post of 11 Aug 2008, I said that recession was the greater concern over inflation, at a time when US CPI was 5% and PPI 14%. Today there are fears of deflation. Looking forward, the risk to inflation is on the upside. In late 2006, the oil price was in the range 60
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Government bonds versus Corporate bonds
Tuesday, 06 January 2009 | 11:33 am
All the bail outs and helpful measures that governments are undertaking to reinvigorate the economy amount to a transfer from the government to the private sector. Government balance sheets must suffer. Corporate balance sheets must improve. Short US Treasuries and treasuries of governments that are already running deficits, thus Europe and the UK, and Long
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Strategies for 2009
Wednesday, 17 December 2008 | 11:07 am
Strategies for 2009 Distressed Asian Convertible BondsLong only and unleveredClosed end fund formatAsia has performing assets at distressed pricesDistressed investors, not distressed issuersList of quasi sovereign issuers – which can later be hedged with sovereign CDS when counterparty risk is settledCurrently poor liquidity – market likely to return albeit smaller than beforeFull exposure to credit
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Madoff is not representative of the hedge fund industry
Wednesday, 17 December 2008 | 12:00 am
The Madoff Fraud is bound to have investors running from hedge funds. However, one should realize that Madoff was not structured as a typical hedge fund. The Madoff structure was unique, and allowed ample latitude for fraud.
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