Research & News
Weekly Geopolitical Report – The Geopolitics of the Reserve Currency: Part 2 (October 31, 2016)
by Bill O’Grady In Part 1 of this report, we discussed how the reserve currency facilitates trade, provided a short history of the dollar’s evolution as the reserve currency and examined the theoretical backdrop of the reserve currency and its role as a global public good. In this week’s report, we will conclude with the economics and… Read More »
Asset Allocation Weekly (October 28, 2016)
by Asset Allocation Committee My weekend exercise is to take my dogs on long walks. Both dogs seem to enjoy these walks and I use the time to listen to podcasts. I recently listened to a long podcast that interviewed Sebastian Mallaby, a British journalist and senior fellow at the Council on Foreign Relations. He has… Read More »
Keller Quarterly (October 2016)
Letter to Investors In our July letter we wrote about the “is-ought problem,” the tendency to confuse the world we have with the world we wish we had. As we noted then, this problem represents a major danger around election time for investors (and others). The danger is that investors may be so consumed with… Read More »
Weekly Geopolitical Report – The Geopolitics of the Reserve Currency: Part 1 (October 24, 2016)
by Bill O’Grady One of the more interesting developments in this presidential political cycle has been the near total abandonment of free trade. Neither presidential candidate supports the Trans-Pacific Partnership (TTP) or the Transatlantic Trade and Investment Partnership (TTIP), the topic of last week’s report. The primary reason for this backlash against free trade is the… Read More »
Asset Allocation Weekly (October 21, 2016)
by Asset Allocation Committee The dollar has been strengthening over the past few weeks; we believe much of this appreciation is due to expectations of tighter monetary policy. Fed funds futures suggest that there is a 60+% chance of a rate hike at the December FOMC meeting. Although the FOMC is divided and there are prominent… Read More »
Weekly Geopolitical Report – The TTIP and the TPP: An Update (October 17, 2016)
by Bill O’Grady In January 2014, we first discussed the Transatlantic Trade and Investment Partnership (TTIP) and the Trans-Pacific Partnership (TPP).[1] Both pacts have moved from obscure trade proposals to highly controversial political issues. In this report, we will begin by discussing the nations involved. We will examine overall details of the proposals, focusing on how… Read More »
Asset Allocation Quarterly (Fourth Quarter 2016)
Although presidential elections gather a lot of attention from investors, we believe the specific person or party getting elected in this cycle may be less important than the forces driving the elections. The Fed is likely to raise rates gradually and we don’t expect the tighter policy to create a recession. Our equity allocations remain… Read More »
Asset Allocation Weekly (October 14, 2016)
by Asset Allocation Committee Given continued sluggish economic growth and fears that monetary policy has reached the point where it can no longer stimulate growth, a renewed attention has been brought to discretionary fiscal policy. In the 1970s, discretionary fiscal policy fell out of favor due to a number of shortcomings: Public investment, if needed, should… Read More »
Weekly Geopolitical Report – American Foreign Policy: A Review, Part II (October 10, 2016)
by Bill O’Grady Last week, in Part I of this study, we examined the four imperatives of American policy with an elaboration of each one. This week, we will discuss why each is important. We will examine why there has been a “drift” in American foreign policy since the end of the Cold War. This drift… Read More »
Asset Allocation Weekly (October 7, 2016)
by Asset Allocation Committee With the elections about a month away, we are fielding an increasing number of questions about the market impact of the result. Although some market commentators are raising concerns about a Trump victory, so far, market data doesn’t seem to suggest a high level of correlation. This chart shows Donald Trump’s average… Read More »