Debt-fuelled World

In the John Authers video presented here is a fascinating work done by Principal Global Investors, joining a group of studies of investing for the long term and the Return landscape for Asset Classes ranging from Equity, Bonds, ETFs and so on. Quite interesting to note some of the conclusions of the Report, like the potential increasing allocation to Real Estate and Alternative Credit Markets and the potential for Institutional Investors other than Global Banks to take these Investments (really good from my point of view). Further it is instructive to learn that gold is an opportunistic short-term investment (besides the value it creates) that have high costs of holding, which explains poor performance. Finally ETFs turned from being a good beta (market exposure parameter) investment to being a tactical asset class and losing status from asset allocation to opportunistic. The brilliant Report and the accompanying video discussion can be downloaded here.

...So Investing isn't so simple....these days!

Despite the Crisis recent data appears to reveal that net wealth in USA's households is rather a lot volatile, and it didn't quite follow the deep dips experience of other major crashes. And that is what  Larry Kantor, head of research at Barclays presents in the video below to FT's John Authers. We can also check that the job of investing these days is a choppy and difficult business, specially if we account for the uncertainties of today's markets and economies. What is interesting in this and contradicting a bit the former video of Authers and Gavyn Davies about the timing of FED tapering, is the idea that we maybe are in for a sooner tapering of Quantitative Easing from the FED and on the other hand we are maybe about to see a breaking point in the correlation verified for the past couple of years between the Bond Markets and the Global Equities Markets in the months ahead....! Quite something!

The Blurred Distinction.....

This edition of John Authers note (with John in person) gives us an account of why the common distinction made in the Financial and Investment community between Developed Markets and Emerging Markets may be eroding as the latter is maturing. As always well versed, researched and quite rightly helped here by  Ewen Cameron Watt, chief investment strategist at BlackRock Investment Institute:

Maturing-emerging-markets