Commentary
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Bumpy Roads
In 2016, PBS published a column entitled “How Gold and Art Auctions Can Gauge Stock Market Confidence.” In it, economist and author Vikram Mansharamani asserted one of the world’s best indicators of overconfidence is the performance of a single stock: Sotheby’s. Peaks in the auction house’s stock price, he wrote, have historically coincided with financial and economic exuberance.
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Fragile Markets
Investors over the past few weeks have gotten a glimpse of how fragile the global financial system can be when its levered underpinnings are tested by higher borrowing costs.
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Solidifying Expectations
In the “Year of the Election”, results to date have been less disruptive than originally feared. Marie Pen’s far right party in France failed to win an absolute majority and Macron was able to hold on to the Presidency but in a weaker state, leaving the country to face an uncertain political future.
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The Global Bull
As we pointed out in our February Commentary, three billion people are expected to head to the electoral polls across several economies over the next two years.
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Volatility in Risk Assets
Tensions between the US and China remain elevated and are likely to continue as we move into the election season.
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Oil Prices Surge Amid Rising Tensions
Tensions continue to escalate in the Middle East as Israel prosecutes its counteroffensive against Hamas/Iran in the Gaza and Russia intensifies its attacks on the Ukraine. Most recently, and in reaction to Israel’s attack on its embassy in Damascus that targeted high ranking military commanders, Iran launched a major drone and missile strike at its neighbor.
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AI Enthusiasm
Earlier this year, the World Economic Forum (WEF) published the 19th edition of its Global Risk Reports. The report “highlights the findings from the WEF’s annual Global Risks Perception Survey, which brings together the collective intelligence of nearly 1,500 global leaders across academia, business, government, the international community, and civil society.
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Domestic Equity Advance
Earlier this year, the World Economic Forum (WEF) published the 19th edition of its Global Risk Reports. The report “highlights the findings from the WEF’s annual Global Risks Perception Survey, which brings together the collective intelligence of nearly 1,500 global leaders across academia, business, government, the international community, and civil society. It also leverages insights from over 200 thematic experts”.
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2023 In Review
2023 proved to be a tumultuous year with two ongoing hot wars (one effectively a proxy war between Russia and the West), a contentious and increasingly protectionist relationship between the U.S. and China, and turmoil in the Middle East that threaten critical global shipping lanes, all of which pose challenges to financial markets.
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Rallying Through Uncertainty
To the surprise of many, the geopolitical ramifications from the conflagration in Gaza (and, by extension, the Ukraine) have not extended to the energy complex, in fact quite the opposite. Oil and natural gas prices peaked in late October, which closely preceded the Hamas attack on Israel.
