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With the noise around US tariffs and war in the Middle East fading, at least for now, we think the stage is set for some further decent returns from “risky” assets – especially US equities – over the next couple of years. But we suspect commodities will …
26th June 2025
Our base case is that the turmoil across financial markets in the wake of President Trump’s “Liberation Day” announcement will continue to stabilise. As such, we assume that most asset prices and the dollar will recover some ground, with equities faring …
17th April 2025
We think US equities will fare better in 2025 than the other major asset classes we monitor, as the AI bubble inflates further. But we expect equities elsewhere generally to lag those in the US and provide worse returns than “safe” sovereign bonds. We …
17th December 2024
We expect equities to fare best among the major asset classes we track through the end of 2025, as the AI bubble reinflates. We suspect government and corporate bonds will generally do less well, despite monetary easing. But we still think they’ll provide …
25th September 2024
We continue to expect equities to outperform most other assets through the end of next year, as the hype around AI builds and lower inflation facilitates more monetary easing in some places than investors are discounting. The tech-heavy US stock market …
1st July 2024
You can use the "Table of Contents" feature, found on the top right of the webpage, to navigate this publication quickly. Summary: The rally in equities over the past year or so, driven in no small part by hype around AI, has left stock markets looking …
24th April 2024
We expect equities to outperform most other assets as a bubble fuelled by AI-enthusiasm continues to inflate, supported by a backdrop of resilient economic growth and monetary easing cycles. In particular, we expect US equities to continue to lead the …
4th April 2024
“Safe” and “risky” assets are both on track for a strong final quarter of the year, and we think next year will deliver more of the same. After all, we think that the main tailwind this quarter – growing expectations that central banks will cut interest …
11th December 2023
Both “safe” and “risky” assets have struggled during Q3 so far, as “risk-free” yields have risen. We expect the fortunes of safe assets to improve over the rest of this year, largely informed by our view that investors are underestimating how quickly …
28th September 2023
Click here to read the full publication. Q2 looks set to go down as a decisive victory for “risky” assets over “safe” ones, thanks in large part to euphoria in the stock market over Artificial Intelligence (AI). But we suspect that the story over the …
27th June 2023
Despite only being three months old, 2023 has already seen several macro narratives play out in markets. “Soft landing” optimism in January was followed by a “no landing” narrative in February which has given way to concerns about a banking crisis in …
31st March 2023
The big sell-off in both equities and bonds that was a feature of 2022 has arguably created scope for them to fare a bit better in the coming years by reducing their valuations. Nonetheless, we don’t think they will provide spectacular returns over the …
21st February 2023
After moving in broadly the same direction for much of 2022, we think that the returns from “safe” assets will generally diverge from those from “risky” assets between now and around the middle of next year. We suspect that long-dated government bond …
1st November 2022
Although we think that we have now passed this cycle’s peak in long-dated US Treasury yields, we still suspect that investors are underestimating just how far the Federal Reserve will raise interest rates, and how long it will be before inflationary …
5th August 2022
Although we suspect that inflation in the US has now peaked, we don’t think that this will prevent either long-dated Treasury yields from rising again or the stock market there from coming under renewed pressure until the middle of next year. Indeed, we …
10th May 2022
Although the Fed is poised to step on the brakes to tackle the highest rate of inflation in four decades, we don’t expect the yields of US equities and Treasuries to rise to anywhere near their peaks in 1982 after the central bank jacked up rates. …
18th February 2022
Although we expect a further rise in government bond yields to undermine the returns from most “safe” assets, we don’t expect it to be big enough to bring the prices of most “risky” financial assets crashing down. Nonetheless, we think that the returns …
31st January 2022
While the combination of a strong economic recovery and accommodative monetary policy has fuelled healthy returns for many investors over the past 18 months or so, we think that the macroeconomic backdrop is now becoming more challenging. We still expect …
29th October 2021
We no longer expect equities and corporate bonds to outperform “safe” government bonds by anything like as much as we did a couple of quarters ago, and we continue to forecast that some other “risky” assets, including most commodities, will struggle over …
21st July 2021
We are forecasting a very strong – but also somewhat uneven – recovery in the global economy over the next couple of years as the pandemic is gradually contained, with three key implications for asset allocation. First, we generally expect government …
16th April 2021
We anticipate that US equities will outperform long-dated Treasuries over the next ten years, even though the valuation of the stock market is even higher now than it was at the beginning of the 1930s and approaching its level at the outset of the 2000s – …
16th February 2021
Although the incoming economic data are likely to remain poor until around mid-2021, we forecast that “risky” assets will continue to outperform “safe” ones comfortably over the next couple of years as a whole. We also anticipate that this will be …
7th January 2021
The market movements of recent weeks are a timely reminder of the importance of the main near-term risks – coronavirus cases rising in major economies as winter approaches, and uncertainty about the forthcoming US election. Both could continue to weigh on …
2nd October 2020
So long as the revival in the global economy continues, even if only gradually, we forecast that “risky” assets will resume their comfortable outperformance of “safe” ones. We do not buy the argument that a retail-driven bubble has formed in equity …
2nd July 2020
Although fiscal and monetary support has helped a bit, we doubt that “risky” assets will sustainably outperform “safe” ones again until the global spread of the coronavirus slows, which would raise the prospect of lockdowns ending and economic activity …
3rd April 2020
While the spread of, and policymakers’ response to, the coronavirus may continue to exert a big influence on asset returns over the next year or two, we don’t assume that it will affect their performance during the rest of this decade. Macroeconomic …
4th March 2020
We think that returns from “risky” assets – equities, corporate bonds, REITs and industrial commodities – will generally beat those from “safe” ones – government bonds and precious metals – again over the next two years, as the global economy finds its …
13th December 2019
This week’s FOMC meeting reinforces our view that many “safe” assets – such as some government bonds and precious metals – will return less than cash in US dollar terms later this year, as central banks in the US and elsewhere fail to ease by more than …
19th September 2019
