Practical analysis for investment professionals
21 January 2014

Avinash Persaud: “We’re Seeing the Final Phase of the Rally”

The first round of quantitative easing by central banks was effective in unfreezing financial markets, explains Avinash Persaud, Emeritus Professor of Gresham College and Chairman of Elara Capital and Intelligence Capital. But later rounds focused on long-dated bonds were largely impotent. As a result, he contends, QE has merely played the role of a very expensive interest rate signal and its tapering suggests the rate cycle is turning.

“Globally, the bond market decline has only just begun,” Persaud told delegates at the fourth India Investment Conference in Mumbai. “For stocks, we’re seeing the final phase of the rally.” Unless growth rebounds in India, he added, the Indian rupee and stock market will experience renewed downward pressure.

You can watch Persaud’s full presentation recorded on 17 January 2014 below. In the talk, he builds on an op-ed that he recently wrote for the Financial Times entitled “An expensive way to speak truth to financial markets.” 

Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.

About the Author(s)
Len Costa

Len Costa was head of communications and content strategy at CFA Institute, where he oversaw global social media, mobile products, and digital content strategy. He previously served as director of interactive media at the Institute for Private Investors (IPI), a peer networking organization for ultra-high-net-worth families and their advisers. Costa also wrote a private wealth column for the Financial Times and, prior to joining IPI, he held senior editorial positions at Institutional Investor and Worth magazines. His writing has also appeared in Forbes, Fortune, Slate, and The New York Times. Costa holds a BA from the University of Virginia, a diploma in French language from the Université de Paris, and a master’s degree in international affairs from Columbia University.

2 thoughts on “Avinash Persaud: “We’re Seeing the Final Phase of the Rally””

  1. Nobuhle Mpande Ofori says:

    Thanks for sharing these enlightening views on why QE works/ will not work.

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