Last week Dubai World’s announcements generated a major shock. It triggered a new debate about excess liquidity, bubbles and re pricing. In that framework, it would be expected that the emerging markets would suffer the most. We believe that the volatility caused by the Dubai World news will not generate a big spill-over-effect, and most read more

Volatility has increased since last week. Even though we considered reducing risk in our portfolios, we decided not to do so. We do not think it is the right time to take any actions. We believe that the increase in the observed volatility could be explained by three main topics, some appear to be more read more

In the last three days the markets seem to be signaling that something has changed. The non US stock markets that had previously recovered the most are now the biggest underperformers. Commodities are showing the same underperformance. The dollar is slowly recovering. It seems that the market is testing the general consensus that the rest of read more

The Brazilian government decided to increase the tax to capital inflows (with the exception to direct investment). This is a bad policy but is not enough to overturn the country’s attractiveness to international capital inflows. Capital controls increase the cost of foreign investment for the economy and therefore diminishes potential growth. The Brazilian government took read more

Just came back from the IMF Annual Meetings in Istanbul, where I attended meetings with ministers and central bank presidents of more than 12 countries, as well as officials from the IMF and G7 governments. Here are a few concise conclusions from all those meetings, that will certainly take a bit more time to fully read more

Before heading to Turkey for the IMF annual meetings, let’s do a little reckoning of views and where things are going (from a big picture standpoint). Also, what are the themes that seem to be shaping this next IMF meetings this weekend, in terms of the debates going on and the agendas put together by read more

The table below illustrates a few interesting points about how different investments and strategies fared through the crisis and the ongoing recovery. The table below shows the price performance of the efficient instruments we would use to gain exposure to each of those sectors. It is by no means a complete list, just a few read more

In the last three days there has been a sharp depreciation of the dollar against the euro and the pound, and to a lesser degree against the reai and won. This re-ignition of the debate about whether the dollar will continue to dominate the global financial system. Our opinion is that there is no natural read more

There was an article in yesterdays’ Wall Street journal that questioned the idea that stocks are a better long term investment than bonds. Moreover, it pointed out the importance of other types of assets such as commodities. This is part of a broader debate on asset allocation, pushing away from stocks. Many of the ideas in read more

The last three days of market selloffs (-3.4% in the S&P500, -4.4% in Europe, or -4.2% for the BRICs) has generated a debate on whether we are in for a more serious pullback. Some are saying that the rally had not been for real nor based on fundamental improvements. Numbers like “another -10/-20%” are being read more