This note looks at where the marginal net buying for equities may come from. We explore the changing nature of equity ownership and how this might impact volatility. We look at the impact of the collapse in commodity prices has had on sovereign wealth funds and conclude that a material risk to markets, for the West at least, comes from very poor fund flows. We are probably more optimistic on the Western economic outlook than consensus, but it is not obvious where the net new buyers come from. Please contact us for a copy.
Walbrook was delighted for the opportunity to debate against the economist Vicky Price. We took the stance that major imbalances still existed and that Public Sector Austerity was more in imagination that reality. We argued that public finances needed to be restored to enable a vibrant private sector based on lower taxes and stability. We contrasted the Irish and Greek economic experiences and highlighted the dangers of deficit funding.
We were delighted to present our views on UK economic and monetary policy to lively and well informed A level students at Wellington College, Berkshire, for an IEA Conference. We looked at a number of themes including 'austerity' and' the North South divide.'
Markets have been troubled by numerous factors, from negative bond yields, perceived deflationary risk, Chinese slowdown, geo-political risk to name but a few, over the last couple of months. This note tries to look through those issues and ascertain where underlying value may result from the recent sharp sell-off.
One of the major shocks of the last Budget was the proposed introduction of the Living Wage, which will be phased in, over employees over 25, from April 2016. By 2020 all employers will be required to pay a minimum of £9 an hour, some 34% higher than the current minimum level. In an environment of near zero inflation this is potentially a significant issue for many companies. This note examines the likely economic implications, the impact on pay differentials and how this will effect quoted stocks. Please contact us for a copy of the note.