On traditional valuation measures, shares have remained quite highly valued and even after the most recent falls, taking into account lower earnings estimates, they are still not unusually cheap. We think this explains much of the weakness of equity markets, quite apart from the particular problems of financials, and also reduces the scope for sustained recovery from these levels.
read more Insights by Stuart FowlerIn a FTfm article in the ‘Talking Head’ series of May 19 three authors of a paper presented to a recent World Bank conference in Washington DC likened the current state of defined contribution pension planning to the early stages of airplane design, when poorly understood technology led to crashes. They contrasted it with the present state of planning plane journeys, when safe outcomes are largely assured by the underlying engineering and the focus is on choices the travellers themselves make that best suit their preferences.
read more Commentary by Stuart FowlerA popular theme today is that the scale of the credit crisis and its resistance to normal corrective mechanisms means we should dust off our history books and study the Depression economy of the 1930s.
read more Research by Stuart FowlerJapan’s ‘lost decade’ of the1990s is rapidly becoming the bogeyman of stories about the future for the world economy and stock markets in the wake of the credit crisis. The same fate supposedly awaits the US (and UK too) as payday for a decade of binge banking and mass delusion by bankers and their customers about house prices. In a new position paper, wealth manager No Monkey Business examines the relevance of Japan’s dire experience of the ’90s for other countries today.
read more Commentary by Stuart FowlerEconomics matter to wealth managers like No Monkey Business. To plan household finances and manage portfolios, we model financial market behaviour. How we model it requires some implicit views of how economies behave. At the heart of our views are some old-fashioned, let’s say orthodox, ideas about banking practice and its impact on the business cycle and asset price cycles.
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