Like modern-day Drs. Frankenstein, central bankers are trying to artificially create life in the financial system. They have embraced extraordinary monetary policies to create economic growth where none would exist. And someday soon, the monsters they are experimenting with may wake up and break out, Ron Rimkus, CFA, explains.
Monetary policy, lagging economic growth, aging populations in the leading global economies — what is the biggest challenge confronting investors on today's fixed-income obstacle course? We polled readers of CFA Institute Financial NewsBrief to find out.
Every player in fixed income hangs on the doings of Janet Yellen and Mario Draghi like teenagers with Taylor Swift and Justin Bieber. The focus is all on exogenous factors, says Jason Voss, CFA. What is not being accounted for? Endogenous criteria like the quality of the business models of the credits or whether a portfolio is diversified enough.
Edward Altman says the benign credit cycle is in “extra innings,” but the metaphorical relief pitchers — central bankers — are running out of gas.
Interest rates are nearing a lower bound, David Schawel, CFA, tells Will Ortel during a recent Take 15 interview. “Most likely we’re not going to be in a 30-year bull market for interest rates falling again,” he said. So what does this mean for fixed-income investors?
In this comprehensive overview of the work of the late economist Hyman Minsky, the author serves up a rich variety of concepts that will stimulate and inform anyone concerned about the fate of the economy. If you want to know where we are going, it helps to know where we have come from, and this book provides an essential road map for that journey — past, present, and future.
Since 2016 began, the prospect of a major devaluation of China’s renminbi has been hanging over global markets like the Sword of Damocles. Although China's policymakers have worked hard to dispel worries, they have yet to persuade investors. Janet Zhang analyzes the causes of the depreciation, as well as the dilemma for China's policymakers.
Backers of the Swiss Vollgeld suggest that if money is divorced from debt and if the government owns the banks' debt, then a run is impossible. Unfortunately, the real world is almost never so simple.
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