One popular misconception is that China’s reinvestment of its “surplus” savings has directly depressed long-term US Treasury yields. If this were true, why have yields remained so low in recent years...

One of the salient features of the US economy since the official end of the Great Recession has been the strength of corporate profits. Nonetheless, we are sceptical that it will last.

We expect any boost to equity prices from the announcement of a third round of quantitative easing (QE3) by the Fed to be much less significant than those that followed the first two rounds.

The US Fed looks set to launch QE3 soon, but a third injection of the same medicine is unlikely to be anywhere near as effective as the first two in supporting the prices of equities or commodities...