Tutti gli investitori del Mondo sono disorientati, confusi ed impauriti (tranne qualche ristretta minoranza).

Non bastava che, nello spazio di poche settimane, il quadro, lo scenario, la “narrativa dominante”, si fosse completamente ribaltata.

Siamo passati dall’ottimismo (ottuso, stupido, arrogante e di convenienza) che dominava ancora in gennaio al pessimismo totale solo sei mesi dopo.

Tutti i grafici, se mesi fa, puntavano all’insù: un esempio lo trovate proprio qui sott. Tutti. E tutti gli “amici del bar” oppure i “colleghi d’ufficio” allora, se mesi fa, vi spiegavano che “è assurdo oggi stare fuori dalla Borsa”. Assurdo, assurdo: dicevano proprio così.

Ma, dicevamo, non basta che oggi la prospettiva si sia del tutto ribaltata. No. va ancora peggio di così.

Per quale ragione? Perché al posto di quell’ottimismo prezzolato e di convenienza del 2021 … non c’è più nulla. Non c’è “una rassicurante nuova narrativa”. Non ci sono ancoraggi, non ci sono punti fermi. C’è solo il caos.

Non si sa più che cosa pensare, tra gli investitori: ad esempio ancora alla metà di giugno, venti giorni fa, tutto era “inflazione”: obbligazioni, azioni, materie prime e valute.

Dopo 20 giorni, nessuno scrive o parla più di inflazione. Niente. Adesso, c’è solo “la recessione”. Decine e decine e decine di titoli, sui siti web, sui quotidiani, su CNBC e sul Plus del Sole 24 Ore.

Noi di Recce’d siamo qui anche per questo. Noi siamo qui anche per aiutare il lettore che è anche investitore a proteggere il proprio patrimonio da queste folli, improvvise, irrazionali ed isteriche variazioni nel mood, nel sentimento dominante, nella “narrativa”.

Noi siamo in grado di farlo, ed infatti noi lo facciamo proprio attraverso questo Blog da almeno una decina di anni.

Perché noi siamo in grado di farlo?

• perché abbiamo competenze analitiche elevate

• perché abbiamo un metodo di lavoro consolidato e testato

• perché il nostro metodo traduce la teoria della valutazione nella pratica della costruzione dei portafogli modello

Di questo metodo, anzi di questa somma di metodi diversi che noi portiamo a funzionare insieme, e che sono alla base della costruzione e gestione dei portafogli modello, abbiamo scritto anche questa settimana, alla pagina SCELTE DI PORTAFOGLIO del nostro sito.

In questo Longform’d, noi ci limitiamo a una frase che sintetizza all’estremo l’insieme dei nostri metodi proprietari: Recce’d non si lascia trascinare nella trappola delle violente oscillazioni nella “narrativa dominante” perché perché Recce’d è capace di distinguere tra “narrativa” delle banche di investimento e delle Reti di promotori e “realtà dei fatti”.

Con questo Longform’d, ve ne offriamo un esempio.

Nel nostro precedente Longform’d di solo pochi giorni fa (6 luglio) vi abbiamo detto a chiare lettere che “inflazione e recessione sono temi di investimento del passato”.

Lo confermiamo. Oggi, il 9 luglio 2022, non contano più. Oggi, nel processo decisionale che porta alla movimentazione dei portafogli modello, contano zero.

Ma per il pubblico, per i media, per il Web, per le banche di investimento e per (soprattutto) le Reti di vendita dei Fondi e delle UCITS, le reti di venditori che si fanno chiamare consulenti, oppure private bankers, oppure wealth managers, e che sono retribuiti a retrocessioni (in conflitto di interesse) , per tutti questi signori oggi nel luglio 2022 si tratta ancora di temi centrali. Inflazione e recessione.

E allora anche noi di Recce’d faremo uno sforzo: consapevoli che investire guardando nello specchietto retrovisore è un errore, ma pure consapevoli che i media e le Reti di vendita hanno un grande potere, che è quello di manipolare la pubblica opinione. Ed è anche (non solo) questa, la nostra sfida professionale.

Ed allora eccoci qui, il 9 luglio del 2022, a parlare un’altra volta di recessione ed inflazione: cosa che noi facemmo già nel 2020, quando invece la grande maggior parte dei media e delle Reti di vendita non solo etichettava questi temi come “inesistenti”, ma pure accusava chi allora li anticipava di “giocare contro”, di eccedere nel “pessimismo”, di essere “in cerca di attenzione”, e di “no fare gioco di quadra”.

Il classico bue che da del cornuto all’asino.

Parliamo allora di inflazione e recessione: ma vediamo di farlo in modo professionale, non superficiale, e non emozionale, come invece vediamo fare ogni giorno dai media e dalle Reti di promotori finanziari.

Partiamo quindi dall’inflazione. Oggi 9 luglio, la “narrativa dominante” sull’inflazione funziona così: l’inflazione è destinata a rallentare, perché sta arrivando la recessione e quindi 'l’inflazione oggi non è più un problema.

Argomento al quale una certa parte dei commentatori poi aggiunge una seconda considerazione: e quindi la Fed e la BCe già l’anno prossimo saranno costrette (dalla recessione) a tagliare i tassi ufficiali di interesse.

Il grafico che, meglio di ogni altro, sintetizza per voi questo stato delle cose, Recce’d lo ha commentato analiticamente in settimana, nel The Morning Brief. Per ragioni di spazio, in questo Longform’d ci limiteremo a ri-presentarlo, lasciano al lettore di analizzarlo.

Nel grafico la linea bianca ci racconta l’inflazione negli Stati uniti, e la linea giallo, l’inflazione “attesa a cinque anni2 come si ricava dalle obbligazioni USA indicizzate all’inflazione, che sono chiamate TIPS.

La differenza che il grafico ci rappresenta, in ogni caso, NON risulta difficile da notare. Noi la abbiamo ulteriormente evidenziata (in arancione nel grafico) per ricordare al lettore il fatto che NON ESISTE UN SOLO PRECEDENTE. Mai vista una cosa simile.

In aggiunta, e per venire alla strettissima attualità, abbiamo evidenziato (nel riquadro blu che vedete nel grafico) il fatto che nelle ultime settimane la linea della “inflazione attesa” è (addirittura) diminuita.

Recce’d vi dice che in questi dati, ed in questo grafico, c’è qualcosa che non va. Anzi, c’è molto, che non va bene.

Non va bene per noi investitori, non va bene per i nostri portafogli di investimento. Il grafico, oggi, esprime un rischio per la gestione dei portafogli modello e in generale dei vostri portafogli.

Di che rischio si tratta? Autorevolmente, ve lo facciamo raccontare dall’intervento che segue: nel quale un esperto del settore vi racconta che le cose potrebbero essere ben di verse da ciò che oggi la maggior parte degli investitori si aspetta.

For the past 20 years, Gang Hu has traded Treasury inflation protected securities and related derivatives instruments, working for big firms like PIMCO and Barclays before starting his own New York hedge fund, WinShore Capital Partners. During most of his career, inflation wasn’t much of a factor in financial markets and few took notice of what traders like Hu were up to in the so-called fixings market.

But as inflation roared back in 2021 and 2022, it has paid to watch the bets that Hu and his counterparts at other firms are making. In their obscure, over-the-counter corner of financial markets, traders like Hu have been buying and selling inflation-like derivatives, making fast judgments about where U.S. price gains could be headed. They’ve got big money on the line — with the prospect of making or losing millions of dollars on a single trade. And for much of the past year, they have been right. 

Their conclusion today: The annual U.S. headline CPI rate will continue coming in above 8% each month for June through September. And while there may be some signs that it’s easing relative to what traders had expected in June, it likely won’t be by nearly enough to soothe the financial market’s fears about the U.S. heading into stagflation. That, in turn, is likely to lead to at least three more months of financial-market tumult, with September’s data released in October, on top of a brutal first half in stocks and bonds.

“The underlying inflation story has not changed much,” Hu, 49, said in an interview. “The fixings’ view is that inflation probably peaks in September or October, and that maybe October is the turning point where things slow down.”

“Right now, the Fed is running against time,” the Shanghai-born trader said. “Inflation better slow down quickly and if it doesn’t come down by September, the Fed will have to probably get rates to around 2.75%. A soft landing depends on a quick turn south of inflation and expectations. But there’s no reason to expect that inflation will come down that fast. And every time we get another strong print, that feeds into the real economy or general psychology. The Fed has a narrow path of escape and it’s getting narrower. Until then, the recession trade continues in markets.”

Traders of so-called fixings, which are related to the $1.8 trillion market for Treasury inflation protected securities, or TIPS, have had a much more aggressive view about inflation over the past year than many prominent policy makers, economists, and investors. While many market players were debating whether recent price increases were “transitory” and the Federal Reserve was still pumping liquidity into the market as recently as March, fixings traders were betting on higher and more persistent inflation.

As their view on inflation panned out, the S&P 500 index dropped, falling by more than 20% in the first six months of 2022 and producing the worst first half in the stock market since the early 1970s. At the same time, government bonds are heading into what might be shaping up to be their worst year since 1865. Inflation needs to trend lower over a period of time to satisfy policy makers and investors — not simply moderate from three straight readings above 8% between March and May.

“I don’t think we’re going back to the old regime of disinflation, but I do think inflation is going to be stickier than most people imagine,” said Chris McReynolds, head of inflation trading at Barclays UK:BARC, which trades fixings as a market maker.

“A lot of supply-chain issues have cleared up and there’s scope for some moderation compared to what we had in the spring and early summer. But we’re not going back to the disinflationary environment that we had prior to 2019. And there’s a risk that inflation doesn’t moderate enough,” said McReynolds, who was Hu’s former boss at Barclays.

Until the past year, traders of so-called fixings didn’t have all that much to sweat about. The U.S. was enjoying almost four decades of relatively low inflation, with annual headline CPI readings regularly coming in below 2% or 3%. And the Federal Reserve’s biggest challenge was how to nudge inflation sustainably higher, not lower. Players in the fixings market include traders at broker-dealers, mutual funds and mostly hedge funds — who also trade TIPS and inflation swaps, and whose activities got little attention, even sometimes within their own firms.

Then came the pandemic and the massive fiscal and monetary response from policy makers, which threw rocks into the ordinarily smoothly-running wheels of global commerce and left inflation surprisingly more persistent than just about everyone thought. 

For the past year, though, it has been inflation-derivatives traders who foresaw a more aggressive path for U.S. inflation and they have been incredibly accurate with their forecasts. For example, they’ve mostly tried to avoid calling a peak in inflation as early as many others in the financial market did, and have foreseen each meaningful leg higher in the annual headline CPI rate since it started breaking away in April 2021: They called inflation’s move toward 6%, 7%, 8% and 8.6% even as most others clung to hopes that price pressures would fade.

Fixings market traders now expect four more months of 8% or higher annual headline readings in the consumer-price index between June and September — an outcome that few in the broader financial market may be ready for. Policy makers are positioned for inflation, based on their preferred gauge, to fall back toward 2% by 2024 and over the long run — and many in the financial market have taken the Fed at its word, as demonstrated by falling long-run expectations in the rates market. September’s CPI number won’t be released until Oct. 13, adding to the likelihood of broader financial-market volatility through then.

Players in the fixings market have varying opinions about the inflation outlook. Those opinions are then boiled down into trades that produce implied levels for the CPI’s annual headline readings each month — or what WinShore’s Hu describes as “the collective wisdom” from the market, with the greatest certainty around the next one to two inflation prints.

Fixings also offer some of the best color on what the market is thinking about: For example, since mid-June, traders have pulled back on their expectations that CPI could start trending at or above 9% — as the result of falling gas prices, readjusting their views faster than professional forecasters. Those traders now see annual headline CPI coming in at 8.9% for June, 8.4% in July, 8.3% in August, and 8.2% in September. From there, the rate is seen as gradually falling to as low as 3.4% next May.

If those expectations for the next handful of months play out, that would be enough to further upset financial markets, said Dec Mullarkey, the Wellesley, Massachusetts-based managing director of investment strategy and asset allocation for SLC Management, which oversaw $268 billion as of March.

That’s because the broader financial market “is buying into the idea of an economic slowdown and inflation that is going to be under control,” Mullarkey said. “A shock in which headline inflation continues to stick at these levels means the Fed will have to continue with more 75 basis point moves, the Treasury curve will have to reprice, and we would see equities down 30% on the year. That kind of persistent inflation is something the Fed couldn’t ignore, and would certainly get us into a recession by the end of the year.”

Though he calls the fixings market’s view “extreme,” he said he’s not quick to dismiss it because “inflation has not been understood in this environment and the risk is that inflation doesn’t decelerate fast enough. Incremental changes such as a drop to 7.9% or 7.7% are not enough. We need to see more substantial slowdowns. Until then, the recession trade continues and there’s a risk of a markets-led recession.”.

 
Inflation derivatives haven’t always turned out to be completely accurate — the sector can be behind the curve whenever the government changes its methodology or data sources for calculating inflation, as was the case in March 2017, September 2018, and March 2019, according to Pasadena, California-based analyst Omair Sharif, founder and president of Inflation Insights, who has tracked the sector’s track record.

Still, “for most of this past year, fixings have — for the most part — been a better predictor of CPI than most forecasters on the street,” Sharif said in an interview. Fixings, in part, “reflect the idea that we might be in a different, higher inflation regime now than in the past, whereas economists might still be using their old models to forecast inflation.”

Some of the most accurate players in the market aren’t from big-name firms, but from less well-known operations with employees whose only job is to sift through price data, said WinShore’s Hu, the 20-year veteran of TIPS and fixings trading. Devoting full-time resources to price changes virtually ensures that those trading shops are coming up with the most accurate feel for inflation, he said. Like most market players, fixings traders are highly incentivized to bet correctly and can be richly rewarded for turning out to right. 

“Every trade has a buyer and seller who can make money by being more accurate than everyone else,” Hu said. “We’re not actively trading unless we see a very clear edge, so we’re not as active as we want to be.”

Though Hu won’t disclose his current positions, strategies or firm’s returns, he’s open about his early losses. In 2003-2004, when he was a junior trader at Barclays, Hu said he suffered his first heavy loss of $500,000, or a quarter of his yearly $2 million trading budget at the time, on a three-month fixing that was the predecessor to the current one-month CPI fixing. Inflation came in higher than he expected, Hu said.

While the fixings market thinks inflation might peak around October, he said it’s hard to forecast much beyond that point. Activity in the fixings market, he points out, is priced for a sharp slowdown in core inflation after October.

“What we really know is the next one or two fixings levels. But we don’t have any information about what the world looks like after October or November,” Hu said. “The market is trying to put its best foot forward by saying, `That’s the best guess I can make.’ But we really don’t know. And everyone else doesn’t know either.”

Se proprio vogliamo estremizzare la sintesi, tutto si riassume in questa immagine che segue: in basso, leggete un commento del Premio Nobel Paul Krugman ai dati del grafico, che sono poi i medesimi dati che avete già letto nel nostro grafico precedente. Sopra al commento di Krugman, un secondo commento: che Recce’d condivide, e presenta alla vostra attenzione, per suggerirvi, ancora una volta, di:

• fare grande attenzione ai dati, ed in particolare ai dati delle prossime due settimane; ed inoltre (di pari importanza)

• lasciare spazio alle sorprese, per ciò che riguarda l’inflazione.

Ed, ovviamente, investire in modo conseguente.

Detto tutto ciò che oggi è davvero importante dire, a proposito del tema “inflazione”, adesso il nostro Longform’d si occuperà, sempre in modo sintetico e stringato, del nuovo tema che chiamano “la recessione”.

Anche in questo caso, il lavoro che vi regaliamo attraverso il Blog è soprattutto finalizzato a de-mistificare: il lavoro delle banche di investimento internazionali, e soprattutto delle Reti di promotori finanziari che vendono i Fondi Comuni (intascando le retrocessioni) è oggi più che mai finalizzato a rappresentarvi una “realtà che non esiste e non è mai esistita”.

Ricordate “l’inflazione transitoria”? Ricordate il “boom economico”? Ed andando indietro, ma solo di qualche anno, ricordate la “crescita globale sincronizzata” del 2018? Tutte cose delle quali avete letto, sui quotidiani, ed avete sentito parlare, dal vostro private banker oppure wealth manager oppure dal vostro Robo-advisor.

Tutte cose mai esiste. mai. Solo fantasia, e slogan di vendita dei “prodotti finanziari ad alto margine. Mai esistiti: l’obbiettivo era quello di “piazzare nel vostro portafoglio certi prodotti”, a fronte di qualche cosa che andava bene raccontare a quel tempo, anche se era evidente da subito che si trattava di fantasie, o per dire meglio di balle.

La situazione si ripresenterà? Sicuramente: quel sistema, quel modo di lavorare, quell’industria, si regge in piedi soltanto su scenari inventati: si regge sulle balle. Se quelle donne e quegli uomini che vendono gli UCITS e i Fondi Comuni di Investimento si decidessero a raccontare la realtà, così come si ricava dai fatti e dai dati, perderebbero tutti i loro Clienti.

Il loro lavoro con i Clienti si poggia al 100% sulla capacità di raccontare “quello che il Cliente vuole sentirsi raccontare”, nell’inventare sempre scenari positivi. Nel fornire assicurazioni che NON sono in grado, poi nella realtà, di garantire: ad esempio, che “i mercati finanziari poi si riprendono sempre”.

I fatti che vi abbiamo appena esposto obbligano l’esercito dei consulenti ad essere “ottimisti sempre e comunque, anche arrivando a negare l’evidenza”. cosa che tutti voi lettori avete riscontrato in decine di occasioni, e da ultimo nel 2021.

Ma vi vogliamo fare notare una cosa, davvero molto importante, e da più di un punto di vista.

Il 2022, lo abbiamo già scritto decine di volte, è oggi e sarà nei prossimi mesi un anno diverso da tutti gli altri. Per questa ragione (sostenuta da una evidenza abbondante) nel 2022 abbiamo visto, e vedremo, cose mai viste prima.

Ad esempio: oggi, vediamo l’esercito delle banche di investimento e l’esercito ancora più grande delle Reti di promotori finanziari diventare “tutti pessimisti” e nello spazio di venti giorni.

La cosa farebbe un po’ ridere, se non fosse tragica per la massa degli investitori, in Italia e nel Mondo.

Perché oggi “tutti pessimisti”? Perché nessuno vuole rimanere indietro. Nessuno vuole essere l’ultimo, a rivoltare la giacca e passare con il “nemico”. Il “nemico” solo tre mesi fa era ancora “il pessimista traditore”, ma oggi? Oggi quel “nemico” di allora ha vinto.

Ed allora, tutti a rivoltare la giacchetta, e tutti “pessimisti”. Senza analisi, senza motivo, senza ragione: solo per il fatto che adesso “tira” il pessimismo, come tema di vendita.

Qui sta il punto, e a voi conviene di comprenderlo a fondo: il “pessimismo2 tira, perché adesso il pessimismo aiuta a “vendere i Fondi e le UCITS”.

Spieghiamo: fino a sei mesi fa, si “piazzava la merce” raccontando di un (del tutto inesistente) boom economico di alcuni anni. I venditori, i private banker, i wealth manager non ne sapevano assolutamente nulla: non sono in grado di fare anche una elementare analisi economica, e allora si affidano in modo cieco a Goldman Sachs ed alla Federal Reserve (che raccontano sempre la stessa storia, all’unisono).

Oggi, per “piazzare la merce” si fa il tifo per la “recessione”: la spiegazione di questo atteggiamento, molto molto semplice, è che prima arriva la “recessione” e prima la Federal Reserve la smette di alzare i tassi di interesse.

Ed ecco qui il suggerimento di Recce’d: non fidatevi. Perché non è vero. E’ solo l’ennesima cosa inventata, l’ennesima balla.

Andiamo nel concreto. Delle possibili sorprese che potrebbero arrivare dall’inflazione 8anche nello scenario della “recessione”), abbiamo ampiamente detto più sopra.

Della “recessione”, invece, che cosa c’è da dire? C’è prima di tutto da dire che, a tutto oggi, NON c’è.

Non dovete leggere, nelle parole appena lette, una affermazione del tipo “non ci sarà mai una recessione”. Quella sarebbe una interpretazione del tutto sbagliata.

Non vogliamo neppure mettere in discussione le previsioni di chi, come la Fed di Atlanta (immagine sotto) oggi stima che anche il secondo trimestre 2022, sono il primo, farà segnare un calo del PIL negli USA.

Non vogliamo contestare le affermazioni di chi sostiene che l’Europa, già oggi, e già nel primo semestre, si trova in recessione.

Non intendiamo discutere questo. No.

Noi vogliamo affermare una cosa ben diversa: ovvero che se anche nel secondo trimestre 2022 (aprile - giugno) il PIL USA fosse calato, e se quindi, “tecnicamente” gli USA fossero in recessione, ebbene …

… ebbene questo per noi e per voi investitori ha una rilevanza pari a zero.

Fatti come questi accadono: fatti di questo tipo NON modificano né i rendimenti attesi degli asset finanziari, né il loro rischio nel portafoglio titoli (quello che si chiama downside), come Recce’d spiega e spiegherà nella sua pagina del sito che si chiama SCELTE DI PORTAFOGLIO.

Amici lettori, fate bene attenzione alle parole, ma soprattutto fate attenzione ai fatti. Di questa “recessione” a voi importa assolutamente nulla, non cambia nulla e non lascia segni nei portafogli titoli.

Se rimane la “cosa” che è oggi, significa niente, per la gestione di portafoglio.

A voi e a noi, investitori sui mercati finanziari, non importa nulla di questa “cosa”: che, come abbiamo chiarito, ha una sola funzione, che è quella di sostenere che “nel 2023 sia la Fed sia la BCE abbasseranno i tassi”.

Oggi è questo il “disco di successo dell’estate 2022”: come tutti sapete, i “dischi di successo dell’estate” dopo tre mesi nessuno li ricorda più. Farà esattamente la stessa fine il tema “la recessione” del giugno - luglio 2022.

E quindi: Recce’d oggi vi scrive che “non ci sarà la recessione”? No, è esattamente l’opposto.

Noi vi stiamo scrivendo la cosa opposta: non date importanza al tema che oggi chiamano “la recessione” per i vostri investimenti. Non è questa “cosa” qui, la recessione, ed infatti questa “cosa” non lascerà segni sui mercati finanziari. Chi oggi opera (compra e/o vende) sulla base della attuale “narrativa della recessione” sta sbagliando, e di nuovo, e di molto. Perderà altri soldi.

La “recessione” è una cosa diversa da questa “cosa” di oggi, e sarà in questo specifico episodio della storia economica una cosa molto diversa.

Non ha nulla in comune, con ciò che vedete oggi. Le ricadute saranno ampie e diverse, così diverse da ciò che oggi immaginate, che oggi voi lettori neppure potete crederci.

Che cosa sarà allora la recessione, quando ci sarà davvero?

Recce’d lo dice, lo racconta, lo spiega ai propri Clienti, e ne analizza le implicazioni solo per i propri portafogli modello.

Invece per i lettori, e gratuitamente, si limita a fornire un suggerimento: se siete tra quelli dei quali abbiamo detto in apertura del Longform’d di oggi, se siete in confusione e non riuscite a costruire il vostro scenario per il futuro, valutate attentamente se non è il caso di farsi supportare, con raccomandazioni generali e portafogli modello, da Recce’d.

E mentre valutate questa alternativa, in ogni caso, non dimenticate mai il nostro suggerimento, che abbiamo scritto anche più in alto: fate massima attenzione alla realtà, ai fatti, ed ai dati. E non fate invece attenzione ai titoli del PLUS, del TG Economia, di CNBC.

Alcuni dei dati di fatto che possono esservi utili oggi, li trovate raccolti nell’articolo che Recce’d vi offre in lettura qui di seguito, e che chiude il Longform’d, che a nostro parere dovete leggere con attenzione, con attenzione molto superiore a quella che dedicate al vostro private banker.

The recession calls are getting louder on Wall Street, but for many of the households and businesses who make up the world economy the downturn is already here.

Take Gina Palmer, who runs She Salon on Atlanta’s busy Northside Drive west of downtown. She’d ordinarily expect her business to be alive with the din of customers on a Friday morning. But on that day late last month, it was largely empty and quiet, save for a few employees. With summer break moving into full swing, her clientele is preoccupied with affording summer camps for their kids amid soaring food and gasoline costs.

“When people look at their budgets, the first thing they cut is self care,” Palmer said. “I’ve seen my clients go from having weekly appointments to bi-weekly, and my bi-weekly clients are now coming in every six weeks.”

4,000 miles away, Abbie Marshall, the landlady of The Buck Inn in the countryside of northern England, is also trying to cope with surging costs. When she took over the pub last year, she ran the numbers on a 4% inflation rate—an assumption that would normally be seen as conservative given it’s twice the Bank of England target. But now it’s above 9% and rapidly heading for double digits.

Marshall has changed the costs on her menu four times and raised the price of a pint of beer on three occasions.

For Palmer, Marshall and many others, the technical definitions of a recession—traditionally two quarters of contraction—are irrelevant.

Goldman Sachs Group Inc. economists put the risk of such a slump in the US in the next year at 30%. A Bloomberg Economics model sees a 38% chance in the same period, with the risks building beyond that time frame. But for many it already feels like it’s here. More than one-third of Americans believe the economy is now in a recession, according to a poll last month by CivicScience.

The worries among small business owners, consumers and others are illustrated by so-called Misery Indexes, which blend unemployment and inflation rates. The gauge for the US is already 12.2%, similar to levels witnessed at the start of the pandemic and in the wake of the 2008 financial crisis, according to Bloomberg Economics.

The UK is similarly elevated, and other measures echo that grim view. US consumer expectations as measured by the Conference Board have dropped to the lowest in almost a decade. Sentiment across OECD member countries has fallen for 11 straight months and hasn’t been this low since 2009.

“People are getting poorer,” said Ludovic Subran, chief economist at Allianz SE. “So this is not a recession, but it really feels and tastes like a recession.”

The reason? Prices are soaring worldwide, particularly for essential foods and fuels, eroding the spending power of families. Central banks are responding to the inflation surge, but as they push up interest rates that turns the screw on those with debts.  Workers are complaining their wages aren’t keeping up with the cost of living, a frustration that’s already led to strikes in some countries.

Quite simply, people’s money is disappearing fast, and they’re worried it could get a lot worse.

And as 2022 hits the halfway mark, new worries are taking hold. Layered on top of the inflation squeeze are the mounting concerns about the outlook for economic growth, not just this year, but into 2023. That’s sparked talk of stagflation, a nasty cocktail of little to no growth—or worse—and faster than usual price increases.

The situation is a far cry from what was once expected for 2022 and beyond, which for a time included the idea of a new “Roaring Twenties.” Instead, euphoria is in short supply and the narrative is one of downgrades.

Last month, the OECD cut its outlook for 2022 global growth to 3% from 4.5%, with even slower expansion seen next year. The World Bank lowered its projections, warning of “danger” for the economy.

Recession Odds

There’s also alarm in markets, where the S&P 500 has plunged more than 20% from its January high, and the Stoxx Europe 600 is down about 19%. The near-constant stream of warnings, along with gloomy headlines, mean there’s a chance that a recession becomes a self-fulfilling prophecy, where apprehension forces consumers and businesses to hunker down and cut back on spending. That would suck demand out of the economy, exacerbating any downturn.

A 2021 paper co-authored by Danny Blanchflower, a Dartmouth College economics professor and former BOE policy maker, said that declines in US consumer expectations gauges of 10 points or more, from either the University of Michigan or Conference Board surveys, are predictors of recessions going back to the 1980s. The Conference Board measure is down almost 30 points this year.

“The risk of a self-fulfilling recession—and one that can happen as soon as early next year—is higher than before. Even though household and business balance sheets are strong, worries about the future could cause consumers to pull back, which in turn would lead businesses to hire and invest less.”

—Anna Wong, chief US economist at Bloomberg Economics. Read more here.

For the US, the National Bureau of Economic Research is the official arbiter of recessions, which it defines as a “significant decline in economic activity that is spread across the economy and lasts more than a few months.”

Any such declaration will usually only come well into a slump, or even after it. In the meantime, the debate rages on. Deutsche Bank AG Chief Executive Christian Sewing sees a 50% chance of a global recession, a prediction that Citigroup Inc. economists have also made. Federal Reserve Chair Jerome Powell says a US recession is a possibility, but not inevitable. Morgan Stanley economists expect a mild euro-area recession at the end of 2022.

Away from that back and forth, businesses and consumers are fretting about their finances and trying to figure out how to keep their heads above water as the pressures intensify.

Wage Pain

Inflation was already heading higher coming into 2022 amid a post-Covid demand bump. Then Russia invaded Ukraine, energy and food costs jumped, and the world found itself dealing with soaring prices, a very unfamiliar situation after years of low inflation. Gasoline in the US topped an average of $5 per gallon for the first time last month.

Given the impact on basics, from filling the gas tank to the supermarket run, few have escaped the squeeze.

In New Mexico’s capital city, the cowboys at the annual Rodeo de Santa Fe last month were sweating the price of fuel more than mounting a 2,000-pound bull. The number of entrants in the contest fell by a third, which President Jim Butler blames on the price of gasoline. While farmers and truckers can pass along their fuel costs, “the cowboys don’t have it,” he said.

The tough times stretch to Asia too, where China’s Zero-Covid policy and lockdowns sent the world’s second-biggest economy into a tailspin, compounding the damage from a real estate slump. 

In Beijing, 31-year-old Tian Lijun began the year shutting the two florists she ran. After finding work as a sales representative for a high-end medical clinic, she lost that job in May. To make ends meet, she’s taken to selling flowers at stalls in community compounds and stopped shopping for anything beyond necessities.

“There’s no way to make money nowadays. I can only manage to repay my loans, pay the rent and feed myself,” Tian said. “Forget about entertainment or any other spending.”

Many have to make even tougher decisions on simple day-to-day spending, sometimes forced to choose between the electricity bill or food. UK grocery chain Tesco Plc says shoppers are buying fewer items and trading down to cheaper own-brand versions of staples.

Just as the pandemic and its recovery proved to be k-shaped, so the next deterioration may prove similarly unequal. In the UK, a report by the Resolution Foundation think tank said that years of income stagnation have left the poorest families “brutally exposed” to the cost-of-living crunch.

Phil Storey’s recent experience as chief executive at Hammersmith & Fulham Foodbank in London is more evidence of that. With food prices up almost 9%, he’s seen an increase in demand. 

“We’re seeing people who were on benefits but stable financially, people who really know how to budget, now coming to us,” Storey said. “We’re even seeing working people, those on zero-hour contracts, needing help to tide them over.”

At The Buck Inn, Marshall raises a similar concern as she tries to balance protecting her income with not driving away customers. 

“The cost of goods is moving so quickly, I have to pass that on,” she said. “But at what point does my pricing become prohibitive? Does going out become so expensive that it is only for the better off?”

Entriamo nella prima settimana delle trimestrali per le Società quotate (trimestre aprile-luglio) senza che la grande massa degli investitori se ne sia rasa conto.

Un rischio enorme, che la maggior parte degli investitori non a neppure di correre con il proprio portafoglio fatto di Fondi Comuni di Investimento, UCITS e Certificati assortiti.

Recce’d, per mettere dell’avviso i propri lettori, gratuitamente aveva pubblicato qui nel Blog una analisi articolata e tempestiva in un nostro Longform’d già un mese fa.

Non sarebbe di alcuna utilità, per i nostri lettori, ripetere in questo breve Post ciò che scrivemmo nel precedente del 10 luglio.

Vi proponiamo allora di leggere, con una grande attenzione, quello che scrivono gli altri a questo proposito: in particolare, per voi abbiamo selezionato un articolo pubblicato proprio questa settimana.

Ci ha colpito il paragone, che apre l’articolo: dove si dice che “come le Banche Centrali sono rimaste dietro la curva nel contrasto all’inflazione, così le banche di investimento sono rimaste dietro la curva nel tagliare le stime degli utili”. L’immagine è efficace, perché costringe ognuno di noi investitori a domandarci: e se la reazione dei mercati azionari fosse del tutto analoga a quella vista sui mercati delle obbligazioni nel primo semestre (nell’immagine)?

Potremmo assistere a qualche cosa di storico, così come ha fatto la Storia ciò che è successo sui mercati delle obbligazioni?

Analysts have likely been behind the curve in cutting earnings estimates as the economic outlook has worsened—and once they catch up, select sectors could be hit particularly hard.

High on the list are economically sensitive areas including apparel companies, automobiles, and other manufacturers.

“Everyone knows [analyst estimates are] too high,” wrote Dennis DeBusschere, founder of 22V Research. 

This year, interest rates have soared as the Federal Reserve looks to lower demand to combat already-problematic inflation. Meanwhile, the aggregate 2022 earnings per share estimate for S&P 500 companies has risen 2% for the year, according to FactSet.

Something has to give, and that likely means analysts need to lower their forecasts. 

The cuts have already begun.

In just the past month, the S&P 500 EPS estimate for 2022 has dropped by about 0.1%, though it is still up on the year.

During that same time, more analysts have cut their estimates than have raised them for the index’s financial, manufacturing, and consumer discretionary sectors, according to Citigroup.  

Some companies have already announced cuts to their earnings guidance. Restoration Hardware (RH) said sales for the entire year will drop year-over-year compared with a prior forecast of up 2%, and that the company’s operating margin will come in lower than previously expected. Management cited worsening demand for housing luxury goods as interest rates rise. 

But that is all probably just the tip of the iceberg. Recent earnings trends look far too high, likely necessitating even further cuts. 

Consumer durable and apparel companies on the S&P 500 are prime examples. Recently, the group’s earnings have trended at just over $25 billion annually, according to Morgan Stanley. That is well above a long-term trend of about $20 billion. 

Automobiles are another example. Annual earnings there have recently trended at $35 billion, above the longer-term trend of closer to $20 billion. 

The same is true for materials manufacturers. Profits there have trended at about $70 billion, above a longer-term trend of about $45 billion. 

The point is that the driver of those sky-high profit figures is now reversing. Trillions of dollars of monetary and fiscal stimulus in 2020 and 2021 fueled soaring consumer demand. Now, inflation and the resulting change in monetary policy are denting that demand. 

“We had such a demand spike during Covid and some of that has to normalize,” said Dan Eye, chief investment officer of Fort Pitt Capital Group. “It seems like analysts are behind the curve on adjusting earnings estimates.” 

Watch out. That could bring more pain in the stock market before the selling is all over with. 

Noi, di Recce’d, lo abbiamo annunciato con anticipo: anni fa.

E’ quindi inevitabile un moto di orgoglio, un aumento dell’autostima.

Perché chi segue il nostro sito, del tutto gratuitamente, ha letto con anticipo, anni fa, ciò che poi oggi ritrova sul suo quotidiano di fiducia, oppure in riviste molto autorevoli come Foreign Policy, dalla quale Recce’d ha ricavato sia l’immagine sopra, sia il testo che trovate in questo Longform’d.

Si tratta di un testo di altissima qualità: e di eccezionale lunghezza (almeno per i criteri del nostro Blog).

Se lo riproponiamo per intero, è proprio perché il lavoro di Adam Tooze, che firma questo articolo, è di eccezionale qualità e completezza.

Nulla di ciò che leggerete qui lo trovate sul Sole 24 Ore, oppure sul Corriere della Sera, oppure in TV su CNBC ed al TG Economia.

Nel vostro interesse, c’è dunque di fare uno sforzo, e leggere per intero l’articolo.

Vi offriamo una lettura accompagnata: i commenti di Recce’d vi guideranno nella ricerca dei punti più significativi.

Ripetiamo una cosa che avevamo già scritto, in alcuni precedenti Post: questo tema è un tema della massima attualità, dal punto di vista sociale e politico. Un tema che avrà concrete e rilevanti ricadute, dal punto di vista sociale e politico.

Mentre invece, sul piano della gestione del portafoglio modello, ed in generale della gestione degli investimenti, oggi la sua importanza è pari a ZERO. In termini di strategia di portafoglio, queste sono cose di uno-due-tre anni fa.

Oggi, a metà del 2022, questo argomento non modifica né i futuri rendimenti, né i futuri rischi di asset finanziari e classi di asset finanziari. La medesima cosa ci sentiamo di affermare per ciò che riguarda gli imminenti rialzi dei tassi da parte sia della Fed che della BCE.

I temi che oggi determinano i futuri rendimenti, ed i futuri rischi degli asset finanziari oggi, a metà 2022, sono altri.

Ora vi lasciamo alla lettura, aggiungendo un dettaglio … da niente.

L’articolo è datato 13 maggio 2020: lo avevamo messo da parte, per voi lettori, in modo da pubblicarlo quando ne sarebbe risultata evidente, a tutti, la rilevanza.

E c’è poi un secondo … dettaglio da niente: noi di Recce’d condividiamo l’analisi di Tooze e ne apprezziamo la elevata qualità: allo stesso tempo (lo diciamo per chi arriverà fino in fondo) Recce’d NON condivide le conclusioni proposte (ricordiamolo, nel 2020) da Tooze. Noi NON vediamo le cose nel modo nel quale Tooze le vede.

In particolare: Tooze scrive a favore di un “allargamento” delle funzioni delle Banche Centrali, Recce’d invece è a favore di un (nettissimo) “restringimento” della loro operatività, in modo che essa ritorni ad allinearsi all’originale mandato.

Non le condividiamo, le conclusioni di Tooze: ma per voi investitori, tutti, è rilevante conoscerle. La ragione? Proprio di questo si discuterà, e moltissimo ed in modo acceso ed anche violento, da qui in avanti.

E quindi: arrivateci preparati. Anche con i vostri portafogli in titoli, perché soprattutto loro, i titoli, gli asset finanziari, ne subiranno le conseguenze.

La Storia, in questi anni, viene e verrà riscritta: cercate di farvene un’idea per tempo.

By Adam Tooze, a columnist at Foreign Policy and director of the European Institute at Columbia University.

In Europe, a ruling by the German Constitutional Court that the European Central Bank (ECB) failed to adequately justify a program of asset purchases it began in 2015 is convulsing the political and financial scene. Some suggest it could lead to the unraveling of the euro. It may be difficult at first glance to understand why. Yes, the purchases were huge—more than 2 trillion euros of government debt. But they were made years ago. And the points made by the court are arcane. So how could a matter like this assume such importance?

The legal clash in Europe matters not only because the ECB is the second-most important central bank in the world and not only because global financial stability hinges on the stability of the eurozone. It also brings to the surface what ought to be a basic question of modern government: What is the proper role of central banks? What is the political basis for their actions? Who, if anyone, should oversee central banks?

As the COVID-19 financial shock has reaffirmed, central banks are the first responders of economic policy. They hold the reins of the global economy. But unlike national Treasuries that act from above by way of taxing and government spending, the central banks are in the market. Whereas the Treasuries have budgets limited by parliamentary or congressional vote, the firepower of the central bank is essentially limitless. Money created by central banks only shows up on their balance sheets, not in the debt of the state. Central banks don’t need to raise taxes or find buyers of their debt. This gives them huge power.

Nella prima parte dell’articolo, che prende spunto da una sentenza della Corte Costituzionale tedesca del 2020, Touze spiega con massima chiarezza perché le Banche Centrali hanno agito come hanno agito in reazione alla pandemia: operando in una libertà pressoché assoluta, ed al di fuori di ogni controllo, proprio perché “a tutti faceva comodo”.

Le Bnache Centrali, infatti, “non devono alzare le tasse per finanziare le spese”.

How this power is wielded and under what regime of justification defines the limits of economic policy. The paradigm of modern central banking that is being debated in the spartan court room in the German town of Karlsruhe was set half a century ago amid the turbulence of inflation and political instability of the 1970s. In recent years, it has come under increasing stress. The role of central banks has massively expanded.

In much of the world, notably in the United States, this has engendered remarkably little public debate. Though the litigation in Germany is in many ways obscure, it has the merit of putting a spotlight on this fundamental question of modern governance. Faced with the hubris of the German court, it may be tempting to retreat into a defense of the status quo. That would be a mistake. Though it is flawed in many ways, the court’s judgment does expose a real gap between the reality of 21st-century central banking and the conventional understanding of its mission inherited from the 20th century. What we need is a new monetary constitution.

Central bankers gather for a G-7 meeting in Washington in April 2004, including (from left) David Dodge of the Bank of Canada; Christian Noyer of the Bank of France; Jürgen Stark of the Bundesbank; Jean-Claude Trichet of the European Central Bank; Alan Greenspan of the U.S. Federal Reserve; Toshihiko Fukui of the Bank of Japan; Mervyn King of the Bank of England; and Antonio Fazio of the Bank of Italy. Stephen J. Boitano/LightRocket via Getty Images

The proud badge worn by modern central bankers is that of independence. But what does that mean? As the idea emerged in the 20th century, central bank independence meant above all freedom from direction by the short-term concerns of politicians. Instead, central bankers would be allowed to set monetary policy as they saw fit, usually with a view not only to bringing down inflation but to permanently installing a regime of confidence in monetary stability—what economists call anchoring price expectations.

La seconda parte dell’articolo di Tooze mette all’attenzione del lettore il concetto della “indipendenza” delle Banche Centrali: che poi è il nocciolo della intera questione.

Ciò di cui oggi si discute, e si discuterà per anni, è proprio questo concetto di “indipendenza” che Tooze illustra alla perfezione qui.

The analogy, ironically, was to judges who, in performing the difficult duty of dispensing justice, were given independence from the executive and legislative branches in the classic tripartite division. With money’s value unhooked from gold after the collapse of the Bretton Woods system in the early 1970s, independent central banks became the guardians of the collective good of price stability.

The basic idea was that there was a trade-off between inflation and unemployment. Left to their own devices, voters and politicians would opt for low unemployment at the price of higher inflation. But, as the experience of the 1970s showed, that choice was shortsighted. Inflation would not remain steady. It would progressively accelerate so that what at first looked like a reasonable trade-off would soon deteriorate into dangerous instability and increasing economic dislocation. Financial markets would react by dumping assets. The foreign value of the currency would plunge leading to a spiral of crisis.

Under the looming shadow of this disaster scenario, the idea of central bank independence emerged. The bank was to act as a countermajoritarian institution. It was charged with doing whatever it took to achieve just one objective: hold inflation low. Giving the central bank a quasi-constitutional position would deter reckless politicians from attempting expansive policies. Politicians would know in advance that the central bank would be duty bound to respond with draconian interest rates. At the same time as deterring politicians, this would send a reassuring signal to financial markets. Establishing credibility with that constituency might be painful, but the payoff in due course would be that interest rates could be lower. Price stability could thus be achieved with a less painful level of unemployment. You couldn’t escape the trade-off, but you could improve the terms by reassuring the most powerful investors that their interest in low inflation would be prioritized.

It was a model that rested on a series of assumptions about the economy (there was a trade-off between inflation and unemployment), global financial markets (they had the power to punish), politics (overspending was the preferred vote-getting strategy), and society at large (there were substantial social forces pushing for high employment regardless of inflation). The model was also based on a jaundiced vision of modern history and more or less explicitly at odds with democratic politics: first in the sense that it made cynical assumptions about the motivations of voters and politicians but also in the more general sense that in the place of debate, collective agreement, and choice, it favored technocratic calculation, institutional independence, and nondiscretionary rules.

This conservative vision legitimated itself by reference to moments of historical trauma. The German Bundesbank founded after World War II in the wake of two bouts of hyperinflation—during the Weimar Republic and the aftermath of Germany’s catastrophic defeat in 1945—was the progenitor. The U.S. Federal Reserve made its conversion to anti-inflationary orthodoxy in 1979 under Paul Volcker’s stewardship. The mood music was provided by President Jimmy Carter’s famous speech on the American malaise compounded by global anxiety about the weakness of the dollar after repeated attempts by the Nixon, Ford, and Carter administrations to stabilize prices through government-ordered price regulations and bargains with trade unions and businesses. Democratic politics had failed. It was time for the central bankers to act using sky-high interest rates. That ending inflation in this way would mean abandoning any commitment to full employment, plunging America’s industrial heartland into crisis, and permanently weakening organized labor was not lost on Volcker. There was, in that famous phrase of the era, no alternative.

By the 1990s, an inflation-fighting, independent central bank had become a global model rolled out in post-communist Eastern Europe and what were now dubbed the “emerging markets.” Along with independent constitutional courts and adherence to global human rights law, independent central banks were part of the armature that constrained popular sovereignty in Samuel Huntington’s “third wave of democracy.” If the freedom of capital movement was the belt, then central bank independence was the buckle on the free-market Washington Consensus of the 1990s.

Da qui in avanti, Tooze esamina i cambiamenti intervenuti negli Anni Duemila, quando i poteri delle Banche Centrali si sono ampliati, in una misura che oggi a molti appare eccessiva e dannosa.

For the community of independent central bankers, those were the golden days. But as in so many other respects, that golden age is long gone. In recent decades, central banks have become more powerful than ever. But with the expansion of their role (and their balance sheets) has gone a loss of clarity of purpose. The giant increase in power and responsibility that has accrued to the Fed and its counterparts around the world in reaction to COVID-19 merely confirms this development. Formal mandates have rarely been adjusted, but there has clearly been a huge expansion in reach. In the American case, where the extension has been most dramatic, it amounts to a hidden transformation of the state, indeed of the U.S. Constitution, that has taken place in an ad-hoc way under the pressure of crisis with precious little opportunity for serious debate or argument.

Conservative economists watch in horror as the paradigm of the 1990s has come apart. Won’t a central bank that intervenes as deeply as modern central banks now do distort prices and twist economic incentives? Does it not pursue social redistribution by the back door? Will it not undermine the competitive discipline of credit markets? Will a central bank whose balance sheet is loaded with emergency bond purchases not fall into a vicious circle of dependence on the stressed borrowers whose debts it buys?

These concerns are at the root of the drama in Germany’s constitutional court. But to know how to respond to them, we need to start by doing what neither the German court nor the ECB’s defenders have so far done, namely to account for how the familiar model of central bank independence has come apart since the 1990s.

The assumptions about politics and economics that anchored the model of the independent central bank in 1980s and 1990s were never more than a partial interpretation of the reality of late 20th-century political economy. In truth, the alarmist vision they conjured was not so much a description of reality as a means to advance the push for market discipline, away from both elected politicians and organized labor.

Tooze qui entra nel cuore dell’argomento: i cambiamenti nel terzo decennio del XXI secolo. Un periodo nel quale sono diventate obsolete, in breve tempo, tutte le idee sulla base delle quali il Sistema era fondato.

In the third decade of the 21st century, however, the underlying political and economic assumptions have become entirely obsolete—as much because of the success of the market vision as its failures.

First and foremost, the fight against inflation was won. Indeed, it was won so decisively that economists now ask themselves whether the basic organizing idea of a trade-off between inflation and unemployment any longer obtains. For 30 years, the advanced economies have now been living in a regime of low inflation. Central banks that once steeled themselves for the fight against inflation now struggle to avoid deflation. By convention, the safe minimal level of inflation is 2 percent. The Bank of Japan, the Fed, and the ECB have all systematically failed to hold inflation up to that target. It was the desperate efforts of the ECB to ensure that the eurozone did not slide into deflation in 2015 that led to the drama in the German courtroom last week. The ECB’s giant bond purchases were designed to flush the credit system with liquidity in the hope of stimulating demand.

Long before the lawyers starting arguing, the economics profession has been scratching its head over this situation. The most obvious drivers of so-called lowflation are the spectacular efficiency gains achieved through globalization, the vast reservoir of new workers who were attached to the world economy through the integration of China and other Asian export economies, and the dramatic weakening of trade unions, to which the anti-inflation campaigns, deindustrialization, and high unemployment of the 1970s and 1980s powerfully contributed. The breaking of organized labor has undercut the ability of workers to demand wage increases. This lack of inflationary pressure has left modern central banks unconcerned about even the most gigantic monetary expansion. However much you increase the stock of money, it never seems to show up in price increases.

Nor is it just the economics that are haywire. Whereas the classic model assumed that politicians were fiscally irresponsible and thus needed independent central banks to bring them into line, it turns out that a critical mass of elected officials drank the 1990s Kool-Aid. In recent decades, we have seen not a relentless increase in debt but repeated efforts to balance the books, most notably in the eurozone under German leadership. Contrary to its reputation, Italy has been a devoted follower of austerity, leading the way in fiscal discipline. But so has the United States, at least under Democratic administrations. Politicians campaigned for fiscal consolidation and debt reduction instead of promises of investment and employment. In the agonizingly slow recovery from the 2008 crisis, the problem for the central bankers was not overspending but the failure of governments to provide adequate fiscal stimulus.

E qui Tooze arriva al tema centrale della questione, per noi investitori ma in realtà per tutti i cittadini dei Paesi nei quali le Bnache Centrali hanno svolto questo ruolo “ampliato ed abnorme”.

Il tema è quello dei mercati finanziari, della loro istabilità, e del ruolo dei Titoli di Stato e delle obbligazioni in generale come “meccanismo di esecuzione delle politica delle Banche Centrali”.,

Rather than obstreperous trade unions and feckless politicians, what central bankers have found themselves preoccupied with is financial instability. Again and again, the financial markets that were assumed to be the disciplinarians have demonstrated their irresponsibility (“irrational exuberance”), their tendency to panic, and their inclination to profound instability. They are prone to bubbles, booms, and busts. But rather than seeking to tame those gyrations, central banks, with the Fed leading the way, have taken it on themselves to act as a comprehensive backstop to the financial system—first in 1987 following the global stock market crash, then after the dot-com crash of the 1990s, even more dramatically in 2008, and now on a truly unprecedented scale in response to COVID-19. Liquidity provision is the slogan under which central banks now backstop the entire financial system on a near-permanent basis.

To the horror of conservatives everywhere, the arena in which central banks perform this balancing act is the market for government debt. Government IOUs are not just obligations of the tax payer. For the government’s creditors, they are the safe assets on which pyramids of private credit are built. This Janus-faced quality of debt creates a basic tension. Whereas conservative economists anathematize central banks swapping swap government debt for cash as the slippery slope to hyperinflation, the reality of modern market-based finance is that it is based precisely on this transaction—the exchange of bonds for cash, mediated if necessary by the central bank.

One of the side effects of massive central bank intervention in bond markets is that interest rates are very low, in many cases close to zero, and at times even negative. When central banks take assets off private balance sheets, they drive prices up and yields down. As a result, far from being the fearsome monster it once was, the bond market has become a lap dog. In Japan, once one of the engines of financial speculation, the control of the Bank of Japan is now so absolute that trading of bonds takes place only sporadically at prices effectively set by the central bank. Rather than fearing bond vigilantes, the mantra among bond traders is “Don’t fight the Fed.”

Central bank intervention helps to tame the risks of the financial system, but it does not stem its growth, nor does it create a level playing field. While high-powered fund managers and their favored clients hunt for better returns in stock markets and exotic and exclusive investment channels like private equity and hedge funds, thus taking on more risk, more cautious investors find themselves on the losing side. Low interest rates hurt savers, they hurt pension funds, and they hurt life insurance funds that need to lock in safe long-term returns on their portfolios. It was precisely that constituency that was the mainstay of the litigation in front of the German constitutional court.

The plaintiffs and their lawyers blame the central bank for pushing interest rates down, benefiting feckless borrowers at the expense of thrifty savers. What they ignore are the deeper economic pressures to which the central bank itself is responding. If there is a glut of savings, if rates of investment are low, if governments, notably the German government, are not taking up new loans but repaying debt, this is bound to depress interest rates.

Nella parte dell’articolo che segue, leggete una serie di considerazioni che sono pesantemente condizionate dallo stato delle cose nella prima parte del 2020, e che quindi NON tengono conto dei due anni successivi.

Proprio per questa ragione, risulta utilissimo leggerle oggi.

The result of this combination of economic, political, and financial forces is an economic landscape that, by the standards of the late 20th century, can only seem topsy-turvy. Central bank balance sheets are grotesquely inflated, yet prices (except for financial assets) slide toward deflation. Before the COVID-19 lockdown, record low unemployment no longer translated into wage increases. With long-term interest rates near zero, politicians nonetheless refused to borrow money for public investments. The response of central bankers, desperate to prevent a slide into self-sustaining deflation, is to reach again and again for stimulus.

In the United States, at least in this respect, the election of Donald Trump as president helped restore a degree of normality, if with a perverse edge. Egged on by Republicans in Congress, his administration has shown no inhibition about huge deficits to finance regressive tax cuts. Apart from anti-immigrant rhetoric, Trump’s winning card in 2020 would be an economy running hot. In 2019, the Fed seemed to be headed into the familiar territory of weighing when to raise interest rates to avoid overheating. Chair Jerome Powell certainly did not appreciate the president’s bullying against rate hikes, but at least the Fed was not lost in the crazy house of low growth, low inflation, low interest rates, and low government spending that the Bank of Japan and the ECB had to contend with.

Since the 1990s, the Bank of Japan has engaged in one monetary policy experiment after another. And driven by the profound crisis in the eurozone under the leadership of Mario Draghi, the ECB embarked on its own experiments. These efforts proved effective in delivering a measure of financial stability. They made central bankers into heroes. But they also fundamentally altered the meaning of independence. In the paradigm that emerged from the crises of the 1970s, independence meant restraint and respect for the boundaries of delegated authority. In the new era, it had more to do with independence of action and initiative. More often than not, it meant the central bank single-handedly saving the day.

Whereas in most of the world this was accepted in a pragmatic spirit—it was reassuring to think that someone, at least, was in charge—in the eurozone it was never going to be so easy. The way that Chancellor Helmut Kohl’s government sold German voters on the abandonment of the Deutsche mark was the promise that the ECB would resemble the Bundesbank as closely as possible. It was barred from directly financing deficits, and, in the hope of limiting undue national influence, it had limited political accountability. Its narrow mandate was simply to ensure price stability.

This was always a gamble, which depended on the willingness of the Italians and French, who also had a voice in the euro system, to go along. Their financial elites pushed for a common currency in part because they were looking for a restraint on their own undisciplined political class—but also because they were gambling that as members of the eurozone they would have a better chance of bending European monetary policy in their direction than they would if their national central banks were forced to follow the Bundesbank by the pressure of bond markets. In the early years of the euro, the compromise worked to mutual satisfaction. But it was always fragile. Once the financial crisis of 2008 forced a dramatic expansion of the ECB’s activity, buying both government and corporate bonds, intervening to cap the interest rates paid by the weakest eurozone member states, pushing bank lending by complex manipulation of interest rates, conflict was predictable. This tension exploded in the German Constitutional Court last week.

Da qui in avanti, fino ad arrivare alle conclusione, l’Autore si concentra sul tema BCE ed Unione Europea: è un tema attualissimo, ed ogni cosa che è scritta nell’articolo è rilevante anche per comprendere la attuale situazione (ad esempio: il tema della “frammentazione” e dello spread dei Titoli di Stato italiani.

Ma se siete stanchi, o facili alla pigrizia, potere scendere fino a dove noi di Recce’d commentiamo le conclusioni.

For the majority of financial opinion, the ECB’s growing activism is broadly to be welcomed. It is the one part of the complex European constitution that actually functions with real authority and clout as a federal institution. Though grudging in her public support, Chancellor Angela Merkel has rested her European policy on a tacit agreement to let the ECB do what was necessary. Allowing the ECB to manage spreads—the interest rate margin paid by weaker borrowers—was easier than addressing the question of how to make Italy’s debt-level manageable. But a recalcitrant body of opinion in Germany has never reconciled itself to this reality. For them, the ECB serves as a lightning rod for their grievances about the changing political economy of the last decade. They blame it for victimizing savers with its low interest policy. They blame it for encouraging the debts of their Southern European neighbors. Exponents of the old religion of German free market economics regard cheap credit as subversive of market discipline. All in all, they suspect the ECB of engaging in a policy of redistributive Keynesianism in monetary disguise, everything that Germany’s national model of the social market economy was supposed to have ruled out. For these Germans, the ECB is an opaque technocratic agency arrogating to itself powers that properly belong to national parliaments, barreling down the slippery slope to a European superstate. And, for them, it is anything but accidental of course that it is all the creation of a Machiavellian Italian with trans-Atlantic business connections, Mario Draghi.

For the body of opinion that had always been suspicious of the euro, Draghi’s commitment to do “whatever it takes” in 2012 was the final straw. The Alternative for Germany (AfD) emerged in 2013 not originally as an anti-immigrant party but as a right-wing economic alternative to Berlin’s connivance with the antics of the ECB. As the AfD has consolidated its position as the anti-establishment party of right-wing protest above all in eastern Germany, its agenda has shifted. But Bernd Lucke, one of the founders of the AfD who has since left the party, was among the plaintiffs whose case the German constitutional court decided last week.

Meanwhile, Germany’s influential tabloid Bild pursued a campaign amounting to a vendetta against Draghi, picturing him last September as a vampire sucking the blood of German savers. And even the Bundesbank leadership, both current and emeritus figures, has not been shy about associating itself with public opposition to the expansive course of the ECB. Defending the strength of the euro against the spendthrift, inflationary ways of Southern Europe played well with the patriotic gallery. But so long as Merkel preferred to cooperate with the ECB’s leadership, that opposition remained marginalized. What has thrown a spanner in the works are the well-developed checks and balance of the German Constitution guarded by the Constitutional Court.

The German Constitutional Court, based in modest digs in the sleepy town of Karlsruhe, has an activist understanding of its role within the German polity, presenting itself as “the citizens’ court” unafraid of upending the political agenda on issues from the provision of child care or means-tested welfare benefits to the future development of the European project. Since the 1990s, the court has been a vigilant check on unfettered expansion of European power. It makes the argument on the basis of defending democratic national sovereignty, insisting on its right to constantly review European institutions for their conformity to the basic norms of the German Constitution.

Each progressive expansion of ECB activism has thus stirred a new round of legal activism. Announced in 2012, Draghi’s instrument of Outright Monetary Transactions, an unlimited bond-buying backstop for troubled eurozone sovereign debtors, was challenged by a coalition of both left-wing and right-wing German plaintiffs. It was not until the summer of 2015 that the court finally and grudgingly ruled it acceptable.

When Draghi finally launched the ECB into large-scale bond buying in 2015, of the type that both the Fed and Bank of Japan had embarked on years before, it too immediately triggered a new round of litigation. In 2017, the court gave a preliminary ruling but referred the case to the European Court of Justice (ECJ). In December 2018, the ECJ declared the program to be in conformity of the European treaties. But the German constitutional judges were not satisfied with the reasoning of the ECJ and held hearings in 2019. After months of deliberation, Karlsruhe was supposed to issue its judgment on March 24, but that was postponed a week beforehand due to the coronavirus pandemic.

That turned out to be opportune because financial markets in March were in crisis. Between March 12 and 18, as the ECB failed to calm the waters, the interest paid by Italy for state borrowing surged. Thanks to massive intervention by the ECB, they have since cooled. Christine Lagarde’s ECB has promised to make an additional round of purchases in excess of 700 billion euros, with more to come if necessary. To calm the markets, what was needed was discretion and largesse—precisely what the German critics of the ECB feared most and had criticized so incessantly in the 2015 bond-buying program.

This made the judgment from Karlsruhe on the 2015 program even more significant. What might the ruling on Draghi’s quantitative easing (QE) signal for possible action against Lagarde’s crisis program? How might the court influence the course of debate in Germany? The initial hearings in 2019 had not sounded favorable to the ECB. The selection of expert testimony by the court was conservative and biased. The court had given full vent to the protests of smaller German banks about the low interest rates that ECB policy permitted them to offer savers. It was as though the court had summoned oil companies, and oil companies only, to give evidence on the question of carbon taxes.

For all the anticipation, the judgment has come as a shock. The question that has ultimately proved decisive is a seemingly conceptual one concerning the distinction between monetary policy and economic policy. The German Constitutional Court declared that the ECB, in pursuing its efforts to push inflation up to 2 percent, had overstepped the bounds of its proper domain—monetary policy—and strayed into the area of economic policy, which the European treaties reserve for national governments.

This is by no means an obvious distinction. It was originally built into the treaties both to protect national prerogatives and to ensure that the ECB’s focus on price stability was shielded against any improper meddling by parties that might prioritize concerns like unemployment or growth. Making this distinction is one of the central dogmas of the German school of economics known as ordoliberalism. But once monetary policy reaches any substantial scale, it in fact becomes meaningless.

The ECJ in Luxembourg reasonably took the view that the ECB has fulfilled its obligation to respect the boundary by justifying its policy with regard to the price objective and following a policy mix typical of modern central banks. It is this casual approach on the part of the ECJ to which Karlsruhe objects. The ECJ waived the case through without assessing the proportionality of the underlying trade-off, the German Constitutional Court thundered. In doing so, it had failed in its duty and acted ultra vires—beyond its authority. It was thus up to the German court to adjudicate the issue, and it duly found that the ECB had not to its satisfaction answered the economic concerns raised by the court’s witnesses. The ECB too was therefore found to have overstepped its mandate.

Since the German court does not actually have jurisdiction over the ECB, the ruling was delivered against the German government, which was found to have failed in its duty to protect the plaintiffs against the overreaching policy of the ECB. As Karlsruhe emphasized, its judgment would not come into immediate effect. The ECB would have a three-month grace period in which to provide satisfactory evidence that it had indeed balanced the broader economic impact of its policies against their intended effects. Barring that, the Bundesbank would be required to cease any cooperation with asset purchasing under the 2015 scheme.

The judgment was delivered to a court room observing strict social distancing, though the judges did not wear face masks. Chief Justice Andreas Voßkuhle, whose 12-year term at the court ends this month, noted that the ruling might be interpreted as a challenge to the solidarity necessary to meet the COVID-19 crisis. So he added by way of reassurance that the ruling applied only to the 2015 scheme. There is no need, therefore, for any immediate change of policy. The markets have so far taken the intervention in stride. But the Karlsruhe decision is, nevertheless, shocking.

It is a spectacular challenge to European court hierarchy. Instead of merely assessing the conformity of the ECB’s policies with the German Constitution, the German court arrogated to itself the right to evaluate the conformity of the ECB actions with European treaty law, an area explicitly left to the ECJ. This will surely play into the hands of those in Poland and Hungary who are determined to challenge the common norms of the European Union. It did not take long for Poland’s deputy justice minister to signal his enthusiastic support for the Karlsruhe decision. This may end up being the case’s most lasting effect.

But it is spectacular also for another reason. In challenging the ECB to justify its QE policy, the German court has put in question not just a specific policy but the entire rationale for central bank independence. What is more, it has done so not only formally but substantively. It has exposed the political and material basis that lies behind the norm of independence.

The claim that the ECB overstepped the bound between monetary and economic policy is, as an abstract proposition, not so much a scandal as a tautology. Only in an ordoliberal fantasy world could one imagine monetary policy working purely by way of signaling without it having an impact on the real economy. Indeed, to affect real economic activity by lowering the cost of borrowing is precisely the point of monetary policy. Far from failing to consider the economic impact of its monetary policies, this is precisely what the ECB spends its entire time doing.

Nevertheless, by harping on this seemingly absurd distinction the court has in fact registered a significant historic shift. The shift is not from monetary to economic policy but from a central bank whose job is to restrain inflation to one whose job is to prevent deflation—and from a central bank with a delegated narrow policy objective to one acting as a dealer of last resort to provide a backstop to the entire financial system. The German court is right to detect a sleight of hand when the ECB justifies an entirely new set of policies with regard to the same old mandate of the pursuit of price stability. But what the German court fails to register is that this is not a matter of choice on the part of the ECB but forced on it by historical circumstances.

Cutting through the legalese and abstruse arguments, the complaint brought to the court by the plaintiffs is that the world has changed. Europe’s central bank was supposed to be their friend in upholding an order in which excessive government spending was curbed, wage demands and inflation were disciplined, and thrifty savers were rewarded with solid returns. The reality they have confronted for the last 10 years is very different. They suspect foul play, and they blame the newfangled policies of the ECB and its Italian leadership. Rather than taking the high ground, recognizing the historical significance of this crisis and calling for a general reevaluation of the role of central banks in relation to a radically different economic situation, the German Constitutional Court has made itself into the mouthpiece of the plaintiffs’ specific grievances, linked those to an expression of fundamental democratic rights, and mounted a challenge to the foundation of the European legal order.

Its willingness to assume this role no doubt reflects its resentment at the usurpation of its supremacy by the ECJ. The decision reflects in this sense a concern to defend German national sovereignty. But it also reflects the cognitive shock of failing to come to terms with the role of central banks in a radically changed world. What this starkly reveals is the limits of existing modes of central bank legitimacy—including the narrative of central bank independence—at the precise moment at which we have become more dependent than ever on the decisive actions of central banks.

To see the head-turning effect of this ruling, imagine an alternative history. Imagine a citizen’s court like that in Karlsruhe convening sometime in the mid-1980s in the United States to evaluate whether or not Volcker’s Fed had adequately weighed the economic impact of its savage interest rate hikes on the steelworkers of the Rust Belt. Or, only slightly more plausibly, imagine a hearing in the Spanish or the Italian constitutional court on the question of whether or not their governments were remiss in not demanding to see the reasoning that justified the ECB’s decision in 2008 or 2011 to raise interest rates just as the European economy was sliding into first one and then a second recession. Were German concerns about inflation at those critical moments weighed against the damage that would be done to the employment opportunities of millions of their fellow citizens in the eurozone? Would Karlsruhe have heard a case brought on those grounds by an unfortunate German citizen who lost his or her job as a result of those disastrously misjudged monetary policy moves?

Of course those decisions were criticized at the time. But that kind of criticism was not considered worthy of constitutional consideration. That was merely politics, and it was the duty of the central bank, and a measure of its independence, to override and ignore such objections.

Flags of the European Union and Germany hang in front of the court in Frankfurt on May 5, the day the German Constitutional Court pronounced its judgment on billion-euro purchases of government bonds by the European Central Bank. Sebastian Gollnow/picture alliance via Getty Images

The political impact of the court ruling has been revealing. On the German side, the business council of Merkel’s Christian Democratic Union immediately expressed its support for the court. So too did a spokesperson for the AfD. Friedrich Merz, a possible right-wing successor to Merkel, let it be known that he now considers the German government bound to exercise a precautionary check on any further expansion of the ECB’s range of action.

The reaction of the European Commission and the ECB was no less immediate. They closed ranks around the ECJ. The clear message they sent was that they are bound by Europe’s common law and institutions. After a few days of deliberation, the ECB declared with supreme understatement that it takes note of the judgment from Karlsruhe but intends to ignore it since the ECB answers to the European Parliament and the European court, not the German Constitutional Court. The ECJ ruled in December 2018 on the asset purchase program at the request of the German court. There are no do-overs. The case is closed.

This leaves the German government and the Bundesbank in a tight spot. The German government, for its part, often goes for years without fully implementing the Constitutional Court’s most ambitious judgments. The Social Democrat-led Finance Ministry in Berlin, which cultivates its image as an advocate of pro-European policies, has played down the decision. The neuralgic point will be the Bundesbank. It is both a German agency, answerable to the Constitutional Court, and a member of the euro system—and thus bound by the statutes of the ECB.

An open and irresolvable conflict between the Bundesbank and the Constitutional Court on the one side and the ECB on the other would compound the tensions already being felt within the eurozone over the issue of the funding of the emergency response to the COVID-19 crisis. Resentment in Italy and Spain toward Germany is already at a high pitch. One might take the German court’s call to limit and balance the ECB’s expansion as a call to, instead, expand the reach of European fiscal policy. The ECB has made precisely that argument itself. But unfortunately the same political forces in Germany that brought the case to the Constitutional Court also stand in the way of a major move toward fiscal federalism.

Given the economic conservatism and hubris of the German court and the prospect of a string of challenges from across the EU by even more unfriendly forces, a strong stance from the European side is to be welcomed. But it would be regrettable if the ECB responded to the quixotic German onslaught against the realities of 21st-century central banking by itself retreating into a defensive bunker.

Tooze scrive, in conclusione dell’articolo, che lo shock della pandemia ha portato sotto gli occhi di tutti il fatto che “le circostanze economiche e politiche che ci avevano portato al modello originale di Banca Centrale indipendente sono cambiate, non soltanto in Germania oppure in Europa ma in tutto il Mondo”.

Questa semplice osservazione ha, ed avrà nei prossimi anni, implicazioni non tutte positive ed alcune gravi e pesanti, per tutti gli investitori e per tutti i portafogli titoli.

Ma in particolare per tutti gli investitori che erano stati indotti a credere nel Falso Mito delle “Banche Centrali Onnipotenti”, delle “Banche Centrali che sanno tutto”, delle “Banche Centrali che possono stampare moneta all’infinito”.

Semplicemente: quelle erano sciocchezze, belle e buone.

Nelle sue conclusioni, Toose riassume in modo estremamente efficace lo stato delle cose, uno stato delle cose che era nel 2020 più o meno il medesimo che nel 2022: dice Tooze che

La stabilità finanziaria è essenziale, ma l'attuale relazione incestuosa tra le banche centrali e il sistema finanziario tende, semmai, a sottoscrivere e incoraggiare pericolose speculazioni da parte di un'élite che si arricchisce da sola. Nel frattempo, la crescita lenta, la disuguaglianza e la disoccupazione sono alla base di molti dei nostri mali sociali e, allo stesso modo, del problema dell'onere del debito: la gestione del debito pubblico dipende in modo cruciale dalla velocità di crescita dell'economia.

Noi vi suggeriamo di leggere con la massima attenzione le conclusioni di Tooze che seguono.

If it was not already evident, the COVID-19 shock has made clear beyond a shadow of a doubt that both the political and economic circumstances out of which the original model of central bank independence emerged have changed, not just in Germany or Europe but around the world. This renders the classic paradigm of inflation-fighting independence obsolete and has thrown into doubt models of narrow delegation. To address the new circumstances in which the real problems are the threat of deflation, the stability of the financial system, and the passivity of fiscal policy, the ECB, like all its counterparts, has indeed been pursuing a policy that goes well beyond price stability conventionally understood. In fact, in Europe the ECB is the only agency engaged in economic policy worthy of the name. Given the limitations of its mandate, this does indeed involve a degree of obfuscation. Despite itself groping in the dark, the Karlsruhe decision has helpfully put a spotlight on the ECB charade.

To respond by doubling down on a defense of independence may be inevitable in the short run. But this too will run its course. The more constructive response would be to advocate for a wider mandate to ensure that the central bank does indeed balance price stability with other concerns; the bank’s second objective should surely be employment and not the interests of German savers. But an open debate about the range of the ECB’s mandate would be a step forward for European politics. The politics of treaty adjustment are not easy, of course. It will take political courage. But the demand itself should not be presented and dismissed as outlandish. After all the Fed has a dual mandate. Alongside price stability, it is enjoined by the Humphrey-Hawkins Act to aim for the maximum rate of employment possible. As the history of the Fed attests, this is far from being a binding commitment. But since 2008 it has provided the Fed with the latitude necessary to expand its range of activities.

That expansion of activity has in large part been a matter of technocratic discretion. The point of pushing for a discussion of a widening of the ECB’s mandate should be the opposite. The aim should be to encourage a wide-ranging discussion about the wider purpose of central banks. Again, the U.S. example may be an inspiration. The Fed’s dual mandate is, somewhat surprisingly, a legacy of progressive struggles fought in the 1960s and 1970s—specifically, by the civil rights movement under Coretta Scott King’s leadership—to force social equity to the top of the macroeconomic policy agenda. This may seem far-fetched, but progressives cannot shrink from the challenge. They should not allow themselves to be held prisoner to the 1990s mystique of central bank independence.

Two new issues make this pivotal in the current moment. One is the financial legacy of the COVID-19 crisis, which will burden us with gigantic debts. The balance sheet of the central bank is a pivotal mechanism for managing those debts. The other issue is the green energy transition and the need to make our societies resilient to environmental shocks to come. That will require government spending but also a reorientation of private credit toward sustainable investments. In that process, the central bank also has a key role. The current mandates require those concerns to be shoehorned in by way of arguments about financial stability. It is time for a more direct and openly political approach.

The independence model emerged from the collapse of the Bretton Woods system and the need to anchor inflation during the Great Inflation of the 1970s. The huge range of interventions currently being pursued by global central banks have emerged out of the crises of a globally integrated financial system. They have been enabled by the absence of inflationary risk. They have succeeded in staving off catastrophe for now. But they lack a positive purpose and updated democratic grounding.

We value price stability, but for better and for worse the forces that once made it an urgent problem are no longer pressing. That objective alone is no longer sufficient to define the mandate of the most important economic policymaking agency. Financial stability is essential, but the current incestuous relationship between central banks and the financial system tends, if anything, to underwrite and encourage dangerous speculation by a self-enriching elite. Meanwhile, slow growth, inequality, and unemployment are at the root both of many of our social ills and by the same token the problem of the debt burden—how we manage government debt depends crucially on how rapidly the economy is growing. Finally, we can no longer deny that we confront fundamental environmental issues that pose a dramatic generational challenge for investment.

These are the policy challenges of the third decade of the 21st century. Money and finance must play a key role in addressing all of them. And central banks must therefore be at the heart of policymaking. To pretend otherwise is to deny both the logic of economics and the actual developments in central banking of recent decades. We should also acknowledge however that this expansion stands in tension with the current political construction of central banks and particularly the ECB. Defining their position in terms of independence, strictly delimited mandates, and rules limits their democratic accountability. That was the explicit intention of the conservative reaction to the turmoil of the 1970s.

If Europe wants to escape the impasse created by the German court ruling, in which one countermajoritarian institution checks another at the behest of a resentful and self-interested minority, we need to step out from this historical shadow. Doing so is no doubt hedged with risks. But so too is attempting to patch and mend our anachronistic status quo. Half a century on from the collapse of Bretton Woods and the emergence of a fiat money world, 20 years since the beginning of the euro, it is time to give our financial and monetary system a new constitutional purpose. In so doing, Europe would not only be laying to rest its own inner demons. It would offer a model for the rest of the world.

Adam Tooze is a columnist at Foreign Policy and a history professor and director of the European Institute at Columbia University. His latest book is Crashed: How a Decade of Financial Crises Changed the World, and he is currently working on a history of the climate crisis. Twitter: @adam_tooze

Il primo semestre del 2022 per la grande parte degli investitori, in Italia e non solo, è stata un vero e proprio incubo.

E questo non soltanto a causa dei risultati, come diremo più avanti.

I risultati, senza dubbio, per la maggioranza degli investitori sono stati disastrosi, ed in una misura che non ha precedenti, come leggete nella tabella che apre il nostro Longform’d.

Disastrosi in particolare di quei portafogli “ad asset allocation” proposti (imposti, per dire meglio) in modo unanime ed uniforme dal cartello delle Reti di vendita di “prodotti finanziari” (le Reti di promotori finanziari, che successivamente sono stati re-brandizzati come “consulenti”, oppure wealth manager, oppure private banker, ma che a tutto oggi devono la loro esistenza unicamente al conflitto di interesse).

I risultati dei citati portafogli, cosiddetti “ad asset allocation” (non è la sola asset allocation possibile: si tratta semplicemente della LORO asset allocation, uguale per tutti) sono in effetti risultati non solo inferiori alle attese di gennaio 2022: sono anche i peggiori risultati semestrali degli ultimi cinquanta anni.

Su questo specifico argomento, ovvero la costruzione del portafoglio titoli e le varie alternative per la asset allocation, noi di Recce’d scriveremo presto in modo ampio ed approfondito, nella pagina del sito che si chiama SCELTE DI PORTAFOGLIO.

Torniamo però all’attualità. Come tutti sapete, le Reti di promotori finanziari, in fasi di mercato come quella attuale, hanno un solo messaggio per il loro Clienti, grandi e piccolo: ovvero “tenete duro, è un brutto momento, ma poi passerà”.

Atteggiamento che non solo non è professionale (non è professionale, in alcuna professione, appellarsi alla “fede” oppure alla “provvidenza di Dio” come nei Promessi Sposi), ma è pure irresponsabile: grandi e piccoli, tutti i promotori finanziari spingono sempre sull’investire, sulla Borsa, persino sui BTP, senza avere la più piccola idea di come in futuro si comporteranno davvero quegli investimenti.

Per la normativa vigente, in Italia ma non solo, la competenza NON è un requisito professionale indispensabile. Spingere su “prodotti finanziari” perché “ad alto margine” (per quelli che li piazzano agli investitori) in conflitto di interesse NON costituisce un problema urgente. E infatti viene tollerato.

Un domani, dice l’immagine qui sotto, le cose potrebbero cambiare: e noi di Recce’d, insieme con tutti gli investitori che hanno consapevolezza ci ciò che fanno dei propri soldi, ce lo auguriamo con tutte le forze.

Proprio per effetto di questa diffusa e profonda incompetenza di cui si è appena detto, e che si può documentare grazie ai dati, quasi tutti gli investitori italiani per due anni sono stati “pompati”, ovvero spinti a mettere in portafoglio “più rischio”, sulla base di argomenti come:

1. il boom economico

2. l’inflazione transitoria

3. le Banche Centrali che hanno il controllo di tutto e prevedono tutto

Erano tutte balle: favole del tutto inventate, al solo scopo di “piazzare la merce”.

Scriverlo oggi è facile: sta scritto su tutti i giornali.

Scriverlo, come noi abbiamo fato, nell’agosto del 2020 e nei mesi successivi, non è stato banale, né facile.

La grande massa degli investitori è stata trattata, dai media e dalle Reti di vendita di Fondi Comuni, come “il gregge dei grulli”, senza che le Autorità preposte ritenessero opportuno proteggerle dalla “infondata euforia” alimentata dai canali di vendita e dai media. E come leggete nell’immagine, anche da alcuni Premi Nobel dell’Economia.

Chi al contrario ha seguito altre e diverse indicazioni, come ad esempio quelle fornite da noi di Recce’d anche attraverso il Blog che state leggendo, oggi NON si trova a soffrire di ansie notturne. Oggi NON soffre di confusione mentale. Ed oggi guarda alle prossime operazioni come fa chi ha “il pallino in mano” e può scegliere.

Come scritto poco più sopra, la maggioranza degli investitori italiani soffre a causa di performances che sono state appena definite “miserabili” niente meno che da Goldman Sachs, come leggete qui nell’immagine. Ma non soffre soltanto per quella ragione.

Soffre, lo ripetiamo, anche per uno stato di ansia profonda e di confusione mentale: tutti i riferimenti, tutti gli ancoraggi, tutti i “punti fermi” che agli investitori erano stati proposti (imposto) negli ultimi quindici anni, dopo la Grande Crisi Finanziaria 2007-2009.

Oggi, la massa degli investitori soffre di ansia e confusione perché non riesce più a costruirsi uno “scenario futuro di riferimento”, e quindi non è in grado di operare scelte di investimento consapevoli, perché non è in grado di dire su che cosa tali scelte vanno fondate.

La grande maggioranza degli investitori ha capito (finalmente) che le Banche Centrali sono molto semplicemente Istituzioni pubbliche gestite da funzionari pubblici, soggetti a pressioni politiche, e non “benefattori universali ed infallibili”. In quanto Istituzioni pubbliche, perseguono obbiettivi politici: beneficiano alcuni, a danni di altri. Fanno scelte politiche, appunto.

Sono, in poche parole, semplicemente esseri umani.

Detto delle Banche Centrali, all’investitore quali certezze restano? I politici, forse? Il Fondo Monetario Internazionale? Goldman Sachs e Morgan Stanley e UBS? Mediolanum e Fideuram? FINECO e Allianz? Generali e una qualsiasi di tutte le altre?

Qui i fatti, e la storia delle Istituzioni citate, parlano da sole, e noi non aggiungeremo altro.

La massa degli investitori si sente così: sola ed abbandonata di fronte all’incertezza. Che oggi è 10, 100, 1000 volte più elevata (sembra a quegli investitori: in realtà, è la medesima che c’è sempre stata). Questa è la crisi di fiducia del titolo qui sopra.

L’investitore consapevole, oggi è costretto a fare uno sforzo (finalmente): deve ragionare con la propria testa, deve selezionare e capire, deve evitare di affidarsi ad un nome, ad uno slogan, ad una etichetta.

Deve fare scelte autonome, indipendenti, non condizionate dal brand.

Deve trovare nuovi riferimenti: il nostro suggerimento, come sapete, è quello di uscire dalla trappola costruita dalle Reti di promozione finanziaria, anche grazie ad una normativa a protezione del cartello commerciale, e affidarsi ad operatori indipendenti, e liberi dal conflitto di interesse.

Affidarsi a chi ha competenza professionale specifica, e a chi non è costretto a ripetervi sempre che “tutto va bene” per mettersi in tasca le retrocessioni delle commissioni sui cosiddetti “prodotti finanziari, come UCITS, certificati, Fondi Comuni e così via.

Come sempre, noi di Recce’d offriamo gratuitamente attraverso il Blog a tutti questi investitori “abbandonati” utili elementi di informazione, di analisi e di valutazione, allo scopo di aiutarli prima di tutto a comprendere ciò che accade intorno a loro.

Noi immaginiamo senza difficoltà l’ansia e la confusione della maggioranza degli investitori, investiti da questa ondata di ribassi e di volatilità. L’investitori di massa non può chiaramente comprendere come sia possibile passare, in soli quindici giorni, da un mercato finanziario totalmente dominato dal tema “inflazione”, con i rendimenti in forte rialzo (Treasury USA al 3,45% e BTp Italia al 4,20% sulle scadenze decennali) ad un mercato dominato in tutto e per tutto dal tema “recessione” (e conseguente crollo dei rendimenti.

E’ successo esattamente questo, nelle ultime due settimane di mercato. Ha senso, la cosa? Non ha alcun senso: una testimonianza concreta è offerta sia dai dati visti la settiana scorsa per l’inflazione, sia dal titolo che leggete qui vicino.

Non ha senso: è semplicemente una concreta ed evidente manifestazione di quel disagio, di quella confusione, di quell’ansia che abbiamo citato più sopra. La situazione dei mercati è dominata dall’emotività, dalla paura, ed appunto dalla confusione.

Violenti cambiamenti di umore di questo genere sono tipici di tutte le fasi di crisi dei mercati finanziari: ma una crisi così ampia e profonda come quella in corso non c’è mai stata prima, ed è quindi del tutto impossibile dire quando le violente oscillazioni si calmeranno. La situazione oggi è questa, e rimarrà questa per almeno un certo periodo.

La “asset allocation” delle Reti di promozione finanziaria, da questo punto di vista, lascia l’investitore del tutto “a vento”, del tutto privo di protezione, ed in balia dei mercati finanziari. Il solo argomento di tutti i private bankers, in questo momento, è sempre il solito: “tenete duro, prima o poi passerà”.

Ma passerà, prima o poi? Loro, i private bankers, i wealth managers, non ne hanno idea, e la grande massa degli investitori neppure.

Recce’d è in grado di risolvere questa ansia, di eliminare questa confusione, e di gestire la fase di mercato in corso portando i propri portafogli modello a risultati positivi e dignitosi senza assumere rischio finanziario in misura eccessiva.

A chi deciderà di contattarci, illustreremo le modalità che permettono di raggiungere questi risultati.

Nel Longform’d di oggi invece ci limitiamo come già detto ad offrire contenuti informativi, analisi e valutazioni a supporto delle scelte di investimento dei nostri lettori.

Nell’articolo che segue, pubblicato in settimana dal Wall Street Journal, leggerete l’opinione di John H. Cochrane, uno dei più noti e qualificati economisti in materia di Finanza e Mercati.

L’articolo vi sarà molto utile, e vi invitiamo a leggerlo per intero. Noi per voi abbiamo evidenziato due passaggi, di particolare attualità;

• un passaggio dove si spiega perché è del tutto sbagliato assumere che “se ci sarà la recessione, calerà anche l’inflazione”; ed anche

• un secondo passaggio dove si sottolinea quale è la maggiore differenza tra la situazione attuale e quella degli Anni Settanta ed Ottanta.

The current inflation was sparked by fiscal policy—the government printed or borrowed about $5 trillion, and sent checks to people and businesses. The U.S. has borrowed and spent before without causing inflation. People held the extra debt as a good investment. That this stimulus led to inflation thus reflects a broader loss of faith that the U.S. will repay its debt.

The Federal Reserve’s monetary-policy tools to cure this inflation are blunt. By raising interest rates, the Fed pushes the economy toward recession. It hopes to push just enough to offset the stimulus’s fiscal boost. But monetary brakes and a floored fiscal gas pedal mistreat the economic engine.

Raising interest rates can lower stock and bond prices and raise borrowing costs, cutting into home construction, car purchases and corporate investment. The Fed can interrupt the flow of credit. But higher interest rates don’t do much to discourage people from spending government stimulus checks. At best, the economy is unbalanced. The economy needs investment and housing. Today’s demand is tomorrow’s supply.

Slowing the economy isn’t guaranteed to reduce inflation durably anyway. Even in the 2008 recession, with unemployment above 8%, core inflation fell only from 2.4% in December 2007 to 0.6% in October 2010, and then bounced back to 2.3% in December 2011. At this rate, even temporarily curing 6% May 2022 core inflation would take a dismal recession. In 1970 and 1974, the Fed raised interest rates more promptly and more sharply than now, from 4% to 9% in 1970 and from 3.5% to 13% in 1974. Each rise produced a bruising recession. Each reduced inflation. Each time, inflation roared back.

The Phillips curve, by which the Fed believes slowing economic activity reduces inflation, is ephemeral. Some recessions and rate hikes even feature higher inflation, especially in countries with fiscal problems. The Fed will face fiscal headwinds. The Biden administration and Congress will wish to respond to a recession with more stimulus and another financial bailout, which will only lead to more inflation. A recession without the expected stimulus and bailout will be really severe.

Higher interest rates will directly make deficits worse by adding to the interest costs on the debt. Reducing inflation was hard enough in 1980, when federal debt was under 25% of gross domestic product. Now it is over 100%. Each percentage point interest rates are higher means $250 billion more in inflation-inducing deficit.

Many governments, including the U.S. under the Biden administration, want to address inflation by borrowing and printing even more money to help people pay their bills. That will only make matters worse. A witch hunt for “greed,” “monopoly” and “profiteers” will fail to make a dent in inflation, as it has for centuries. Price controls or political pressure to reduce prices will create long lines and exacerbate supply-chain snafus. Endless dog-ate-my-homework excuses, spin about “Putin’s price hike” and transparently silly ideas such as a gas-tax holiday only convince people that the government has no idea what it’s doing.

Monetary policy alone can’t cure a sustained inflation. The government will also have to fix the underlying fiscal problem. Short-run deficit reduction, temporary measures or accounting gimmicks won’t work. Neither will a bout of growth-killing high-tax “austerity.” The U.S. has to persuade people that over the long haul of several decades it will return to its tradition of running small primary surpluses that gradually repay debts. That outcome requires economic growth, which raises long-run taxable income. Raising tax rates alone is like climbing a sand dune, as each rise hurts income growth. The U.S. also needs spending reform, especially on entitlements. And it needs to break the cycle that each crisis will be met by a river of printed or borrowed money, bailouts for big financial firms and stimulus checks for voters.

The good news is that inflation can end quickly, and without a bruising recession, when there is joint fiscal, monetary and economic reform. The inflation targets New Zealand, Israel, Canada and Sweden adopted in the early 1990s are good examples. They included deep fiscal and economic reforms. The sudden end of German and Austrian hyperinflations in the 1920s, when fiscal problems were resolved, are more dramatic examples. In the U.S., tight money in the early 1980s was quickly followed by tax, spending and regulatory reform. Higher economic growth produced large fiscal surpluses by the end of the 1990s. Without those reforms, the monetary tightening might have failed again. If those reforms had come sooner, disinflation might well have been economically painless.

Mr. Cochrane is a senior fellow at the Hoover Institution and author of “The Fiscal Theory of the Price Level,” forthcoming this fall.

Noi di Recce’d giudichiamo l’articolo che avete appena letto in modo molto positivo. per fare le vostre scelte di investimento nel secondo semestre 2022 non potete prescindere da ciò che Cochrane scrive qui sopra.

Dunque, concetti imprescindibili: ma, presi da soli, non sufficienti, a nostro giudizio.

Noi pensiamo che sia indispensabile aggiungere altri elementi, per comporre una vostra valutazione, arrivare alla consapevolezza di ciò che state facendo, e scegliere per il futuro del vostro portafoglio in titoli.

Per questa ragione, completiamo la terza parte del nostro Longform’s con un secondo articolo, tratto in questo caso dal Financial Times.

Nell’articolo che segue, firmato da Mohamed El Erian, ritorniamo al tema della credibilità e della fiducia, che è il tema conduttore dell’intero Longform’s in tre parti pubblicato dal nostro Blog.

Non fatevi cogliere impreparati, e non fatevi distrarre: è questo oggi il tema centrale sui mercati finanziari, il tema sulla base del quale si muoveranno nel secondo semestre 2022 i mercati, e quindi i titoli nel vostro portafoglio.

Da questo tema deriva la accentuata, ed in qualche caso abnorme, volatilità dei mercati di queste ultime settimane, e delle prossime settimane.

Dalla volatilità dovete partire, e tutti devono partire oggi per la gestione dei propri investimenti.

Da questo tema quindi dovete procedere, per le vostre future scelte ed in generale per la gestione di portafoglio.

Leggendo l’articolo che noi vi offriamo qui, sarete informati nel modo migliore sia in merito alle ragioni per le quali la credibilità delle Istituzioni oggi viene messa in discussione dai mercati finanziari, sia in merito ad una situazione di instabilità finanziaria nel prossimo futuro, sia sul rischio di ulteriori, gravi errori nelle scelte di politica monetaria e fiscale.

Non potete avere alcuna consapevolezza delle vostre scelte di investimento, se non vi siete chiariti le idee su questi argomenti: più che mai, oggi per la vostra gestione di portafoglio non è possibile accontentarsi delle frasi imbonitrici del tipo “state calmi, andrà tutto bene, si sistemerà tutto”.

The markets are evolving their minds about US economic prospects just as the Federal Reserve has been scrambling again to catch up to developments on the ground. This risks yet another round of undue economic damage, financial volatility and greater inequality. It also increases the probability of a return to the “stop-go” policymaking of the 1970s and 1980s that exacerbates growth and inflation challenges rather than addressing them. Good central bank policymaking calls for the Fed to lead markets rather than lag behind them, and for good reasons. A well-informed Fed with a credible vision for the future minimises the risk of disruptive financial market overshoots, strengthens the potency of forward guidance on policy and provides an anchor of stability that facilitates productive physical investment and improves the functioning of the real economy.

Coming into the second half of June, the Fed had already lagged behind markets twice in the past 12 months and in a consequential manner. First it stubbornly held on to its “transitory” mischaracterisation of inflation until the end of November, thereby enabling the drivers of inflation to broaden and become more embedded. Second, having belatedly course-corrected on the characterisation, it failed to act in a timely and decisive manner — so much so that it was still injecting exceptional liquidity into the economy in the week in March when the US printed a 7 per cent-plus inflation print. These two missteps have resulted in persistently high inflation that, at 8.6 per cent in May, is hindering economic activity, imposing a particularly heavy burden on the most vulnerable segments of the population, and has contributed to significant market losses on both stocks and government bonds.

Now a third mis-step may be in the making as indicated by developments last week. Having rightly worried about the Fed both underestimating the threat of inflation and failing to evolve its policy stance in a timely manner, markets now feel that a late central bank scrambling to play catch-up risks sending the US economy into recession. This contributed to sharply lower yields on government bonds last week just as the Fed chair, Jay Powell, appeared in Congress with the newly-found conviction that the battle against inflation is “unconditional”.

The markets are right to worry about a higher risk of recession. While the US labour market remains strong, consumer sentiment has been falling. With indicators of business confidence also turning down there is growing doubt about the ability of the private sector to power the US economy through the major uncertainties caused by this phase of high inflation. Other drivers of demand are also under threat. The fiscal policy impetus has shifted from an expansionary to contractionary stance and exports are battling a weakening global economy.

With all this, it is not hard to see why so many worry about another Fed mis-step tipping the economy into a recession. In addition to undermining socio-economic wellbeing and fuelling unsettling financial instability, such a mis-step would erode the institutional credibility that is so crucial for future policy effectiveness. And it is not as if Fed credibility has not been damaged already. In addition to lagging behind economic developments, the central bank has been repeatedly criticised for its forecasts for both inflation and employment — the two components of its dual mandate. A recent illustration of this was the sceptical reaction to the Fed’s update on monetary policy released on June 15.

The scenario that worries the market — the Fed aggressively hiking rates only to be forced to reverse by the end of this year due to the threat of recession — is certainly a possibility, and it is not a comforting one. T

here is another equally possible alternative, if not more likely and more damaging economically and socially: A multi-round flip-flopping Fed. In this scenario, a Fed lacking credibility and sound forecasts would fall in the classic “stop-go” trap that haunted many western central banks in the 1970s and 1980s and remains a problem for some developing countries today lacking policy conviction and commitment. This is a world in which policy measures are whipsawed, seemingly alternating between targeting lower inflation and higher growth, but with little success on either. It is a world in which the US enters 2023 with both problems fuelling more disruption to economic prosperity and higher inequality.

Ve ne abbiamo scritto per due anni, ed ora tutti avete davanti agli occhi lo scenario che Recce’d aveva anticipato. Chi ci segue con regolarità, e trae indicazioni operative dalle nostre osservazioni, sicuramente ne sta beneficiando.

E chi ce lo dice? Niente di meno che il Governatore della Banca del Giappone, Kuroda, e nel modo più chiaro possibile. Lo vedete nelle prime tre immagini del Post, che risalgono addirittura allo scorso aprile, ma che risultano attualissime dato ciò che abbiamo saputo della riunione della Banca del Giappone di ieri 17 giugno 2022 (della riunione nello specifico scriviamo più in basso in questo Longform’d).

Negli ultimi due mesi e mezzo, il mercato ha spinto Kuroda, e la sua Banca del Giappone, ad un limite. Lo ha testato. Fino al punto che lui già nel mese di aprile era stato costretto ad uscire allo scoperto (cosa molto difficile per un giapponese) e dire “non credo che il mercato abbia perso fiducia nello yen”.

Ma soprattutto (lo leggete nella immagine che segue) Kuroda era stato costretto a dichiarare già due mesi e mezzo fa: “comperiamo Titoli di Stato solo perché vogliamo raggiungere gli obbiettivi di politica monetaria: non è vero che comperiamo i Titoli di Stato per finanziare le spasa pubblica”. Per poi concludere: “se si perde la fiducia nella capacità di controllare la spesa pubblica, poi si perde il controllo dei tassi di interesse”.

Amici lettori, che più chiaro di così non è possibile parlare. Più chiaro di così, non è possibile spiegarvi le cose. E un discorso del tutto simile andrebbe fatto, ad esempio, a proposito dei BTp italiani.

Oggi noi riprendiamo un tema che avevamo già trattato nel nostro Blog, ovvero il tema della fiducia, perché risulta sempre più evidente, anche per i meno attenti ed i meno competenti, che tutti nell’attuale scenario dei mercati gioca un ruolo importantissimo la fiducia nelle istituzioni e la credibilità delle Banche centrali e dei Governi.

Tutti i vari temi di mercato di cui leggete ogni mattina sui quotidiani (dall’inflazione alla recessione, dalle materie prime all’occupazione) si stanno riordinando come satelliti di un solo tema: il pubblico, degli investitori ma pure dei non-investitori, sta perdendo i suoi ancoraggi, i suoi punti di riferimento, ovvero sta perdendo la fiducia. Piano piano (fino ad oggi) la paura ha sostituito la fiducia.

Noi di Recce’d vi diciamo da mesi che sarà questo il principale tema di mercato 2022 - 2025.

Come già specificato, le frasi di Kuroda che leggete qui sopra risalgono al 2 aprile 2022 : e sembrano quasi profetiche. Diceva allora Kuroda: se si perde la fiducia nella politica fiscale (nel debito dello Stato), si perde il controllo dei tassi di interesse. E non soltanto di quelli, aggiunge oggi Recce’d.

Le frasi di Kuroda diventano quindi molto significative rilette oggi, a due mesi di distanza, visto ciò che è successo nel frattempo in Giappone, fino alla riunione di ieri mattina della Banca del Giappone (riunione che commentiamo più in basso in questo Longform’d). E anche vista la volatilità elevata nel comparto dei Titoli di Stato in Eurozona nel mese in corso.

Vi suggeriamo di mettere a confronto la frase di Kuroda (quella dell’immagine) con il clima che si respirava sui mercati finanziari sei mesi fa, a inizio 2022.

Vi suggeriamo in particolare di metterle a confronto con quello che per due anni il vostro wealth manager, il vostro private banker, il vostro robo advisor vi ha ripetuto.

Che cosa vi ripeteva, con tono sicuro, fino a tre-sei mesi fa? Che non c’erano rischi, per i vostri soldi, nei mercati finanziari del dopo-pandemia, perché “le Banche Centrali ci coprono le spalle”, perché “le Banche Centrali stampano moneta e quindi sono onnipotenti”, perché “le Banche Centrali hanno il controllo totale dei mercati finanziari”.

Tutte e tre, questa affermazioni, erano delle barzellette: come i fatti poi ci hanno mostrato.

E naturalmente, c’è chi ha riso molto.

Rilette oggi, a soli tre-sei mesi di distanza, quelle affermazioni, e tutti i suggerimenti e i consigli operativi che ne derivavano (“è questo il momento di investire in Borsa”, “i mercati recuperano sempre”, “è assurdo oggi stare fuori dalla Borsa”) fanno sorridere.

E una bella risata, dicono, allunga la vita.

Purtroppo però non è con una risata che si risolvono i dubbi sui propri investimenti e sul proprio portafoglio in titoli. Per fare le scelte giuste, ci vuole altro.

Ci vuole in primo luogo la capacità di analizzare, in modo analitico ed anche critico, la situazione attuale (dei mercati, delle economie, delle società), unita alla capacità di ricavarne poi indicazioni utili alla stima di rendimenti e rischi sui mercati finanziari di qui a tre, sei, dodici mesi. Ed arrivare in questo modo a fare le giuste scelte per il proprio portafoglio in titoli.

Chi potrebbe aiutarci, in questo difficile compito?

Forse la Banca Centrale Europea?

Madame Lagarde, per tutto il 2022 ed in modo insistito, ci ha informati che “dai dati disponibili oggi non si vede alcun rischio di stagflazione”. In modo particolare il 30 marzo 2022 noi abbiamo archiviato l’immagine qui sopra. La abbiamo archiviata nel nostra database, mettendola con cura a fianco dell’immagine che segue, che è datata 28 ottobre 2021. Esattamente cinque mesi prima. Cinque mesi sono 150 giorni circa.

Questi personaggi oggi sono alla guida delle Istituzioni a cui è stato affidato il potere assoluto sulla politica monetaria: per noi investitori, questo è motivo di preoccupazione. Anzi, questo è la massima ragione di preoccupazione, come vi scriviamo da due anni. E come abbiamo ulteriormente ribadito solo ieri nel nostro ultimo Longform’d.

Per fortuna, non tutti i banchieri centrali sono incompetenti ed irresponsabili: solo la maggior parte di quelli oggi in carica (ma passerà anche questa).

Per completezza, vogliamo evidenziare qui che c’è tra i Banchieri Centrali c’è anche chi preferisce, alla propaganda … da venditori di pentole in TV, il parlare con chiarezza e competenza, come la carica richiede.

Qui sotto, noi vi riportiamo le parole di un esponente della Banca di Inghilterra, pronunciate qualche settimana fa.

Si tratta di parole molto utili, per comprendere il contesto che tutti ci troviamo ad affrontare. Sono utili in particolare per i molti che, ancora oggi, si comportano che se l’inflazione fosse un fenomeno virtuale, come se tutto intorno a loro fosse un videogioco, dove è sufficiente premere il tasto “RESET” e tutto si azzera.

Si tratta di molti investitori, di molti operatori economici e pure di molti semplici consumatori, che si atteggiano come se non fosse successo nulla nella vita reale, che si rifiutano di vedere il cambiamento in atto, a proposito del quale è giustificato utilizzare l’aggettivo “storico” come è stato fatto proprio da questo esponente della Banca di Inghilterra.

A tutti questi soggetti, la lettura dell’articolo che segue risulterà particolarmente utile.

Amici lettori: la realtà, quella nella quale ogni giorno lavorate, vi divertite, respirate e mangiate è quella che viene descritta qui sotto. Aprite gli occhi, e fatelo per tempo.

Britons face a “historic shock” to their incomes this year sparked by surging energy prices that will hit UK economic growth and consumer demand, Bank of England governor Andrew Bailey warned on Monday.

Bailey said Russia’s invasion of Ukraine would fuel the UK cost of living crunch, adding the energy price shock in 2022 would be larger than during any single year in the 1970s.

The BoE governor sounded the alarm on so-called stagflation, suggesting slowing economic growth and soaring inflation posed the biggest challenge to the central bank’s Monetary Policy Committee since its creation in 1997. Surging energy prices are a key factor behind UK consumer price inflation reaching a 30-year high of 6.2 per cent in February, more than three times the BoE’s 2 per cent target. The BoE expects Russia’s war in Ukraine to help push inflation to about 8 per cent in the second quarter of this year.

It said this month inflation could potentially climb even higher in the autumn, when regulated energy prices are due to increase further. The shock from energy prices this year will be larger than any single year in the 1970s. Andrew Bailey Bailey said Britons were facing a “very large shock to aggregate real income and spending” from rising prices of energy and imported goods. He told an event organised by Bruegel, the think-tank, in Brussels: “This is really an historic shock to real incomes.” Bailey said Russia’s invasion of Ukraine had exacerbated the energy supply shock, adding: “The shock from energy prices this year will be larger than any single year in the 1970s. The caveat is that the 1970s had a succession of years and we very much hope that would not be the case now. But as a single year, this is a very, very big shock.”

UK inflation spiralled upwards during the 1970s after Arab members of Opec, the cartel of oil producers, imposed a crude embargo on countries that had supported Israel in the Yom Kippur war. Bailey said the UK and the eurozone were confronting a similar energy shock, because they both relied on the same gas market, adding it was different for the US because of its bigger domestic supply. He also said the US was experiencing a stronger rebound in demand after the worst of the coronavirus pandemic compared with the UK and Europe.

Last week, the Office for Budget Responsibility, Britain’s fiscal watchdog, predicted that UK household real income this year would contract at the sharpest rate since records began in the 1950s. Bailey said: “We expect it to cause growth and demand to slow. We’re beginning to see the evidence of that in both consumer and business surveys.” The OBR has cut its UK growth forecast for 2022 from 6 per cent to 3.8 per cent.

Slower economic growth and higher inflation are often referred to as stagflation: a relatively uncommon situation as prices of goods and services tend to rise most sharply in periods of robust consumer demand and strong expansion of output. Bailey said the BoE had a variety of monetary policy tools to deal with the current situation, but warned of the challenges given growth and inflation were “pulling in different directions”. “This is a big trade-off,” he added. “I think it’s the biggest trade-off the Monetary Policy Committee has faced in its now approaching 25 years life.”

Meanwhile chancellor Rishi Sunak told the House of Commons Treasury select committee he was determined to hold down public borrowing and spending, saying he feared that looser fiscal policy could further fuel inflation. Sunak said a 1 percentage point rise in inflation and interest rates could “wipe out” the headroom he had built into his tax and spending plans in the run-up to the next election.

Dopo avere letto queste utili parole del Governatore della Banca di Inghilterra, ora ritorniamo al Giappone ed a Kuroda, dal quale il nostro Longform’d era partito.

E rivediamo nel dettaglio, con l’articolo che segue, la riunione di ieri: riunione di ieri che resterà, a nostro avviso, nella storia dei mercati finanziari tanto quanto la “riunione di emergenza” della BCE del mercoledì 15 giugno e poi la riunione “dello 0,75%” della Federal Reserve del giorno successivo.

Per quale ragione? Lo leggerete nell’articolo, ed in particolare nella parte dell’articolo che Recce’d ha evdenziato per voi.

Following a week of historic rate hikes and aggressive moves by the Federal Reserve and other major central banks, the Bank of Japan has hardly ever seemed more like a rebel standing athwart the consensus.

And after its two-day policy meeting Friday, the BOJ, as expected, left interest rates at ultraloose levels, despite a plunging Japanese yen.

Unfortunately for some investors, the BOJ’s refusal to accede to the market’s demands has come at a price. And judging by recent market ructions in the dollar-yen currency pair , Japanese stocks (which were sinking in Friday trading) and the market for Japanese government debt — which the BOJ has long backstopped with seemingly bottomless bid — it looks like the central bank has found itself entrenched in a battle with foreign speculators, analysts said.

Despite the central bank ramping up its bond-buying earlier in the week, Japanese government bonds, particularly at durations below the 10-year mark, have seen yields, which move opposite of prices, surge.

The selloff cooled on Thursday as the Bank of Japan’s two-day policy meeting got under way, and yet, the damage has largely been done. Bloomberg reported that the Bank of Japan could face “huge losses” on its $4 trillion trove of government bonds should it abandon its easy money policies.

What’s more, the hope among economists and market participants that the Bank of Japan might make a slightly dovish adjustment to its policy of yield curve control caused markets to whipsaw — the dollar-yen currency pair on Thursday appeared headed for its largest two-day correction since March 2020.

Jens Nordvig, the founder and CEO of Exante Data and a longtime currency market guru, noted via Twitter that the scramble to hedge against a more assertive tone from the Bank of Japan has been quite intense.

As far as what that shift might look like, analysts at Japanese banks have been eerily silent, and economists and market strategists looking on from abroad have ventured to speculate that BOJ Gov. Haruhiko Kuroda and his team might eventually ease up on the acceptable yield ranges for JGBs — although there seems to be wide agreement that any kind of substantial move on the central bank’s part on Friday would be extremely out of character.

When it does arrive, it’s possible that the move could look like a widening of the central bank’s acceptable range for the JGB yields for bonds and bills of the shortest maturity through the 10-year. But even this seems relatively modest when viewed in the context of what the rest of the world’s central banks — with the Federal Reserve front and center — appear to be doing.

The surge in JGB yields appears to have abated (at least, for now), and the dollar has staged a notable reversal, weakening more than 2% against the yen Thursday in what was its biggest two-day drop since March 2020. But analysts say the fact remains that the state of the Japanese 10-year yield curve signals that investors are ready to duke it out with the BoJ, as the bank has been buying trillions of dollars’ worth of bonds just to maintain the status quo. If it persists at the current rate, it will have bought some 10 trillion yen (worth some $75 billion) in June.

“This is a truly extremely level of money printing,” said Deutsche Bank’s George Saravelos.

What’s at stake?

Saravelos warned that if confidence in the BOJ’s ultraloose policy gives way, the result could be chaos in Japanese stocks and equities.

“If it becomes obvious to the market that the clearing level of JGB yields is
above the BoJ’s 25 basis point target, what is the incentive to hold bonds any more?” Saravelos said. “Is the BoJ willing to absorb the entirety of the Japanese government bond stock?”

“Where is the fair value of the yen on this scenario and what happens if the BoJ
changes its mind?” he said.

But it’s not just Japan that will be affected — far from it. Analysts said ripples could spread through stock and equity markets across Asia, and perhaps Europe and the U.S. as well.

Further strength in the U.S. dollar accentuates market sensitivities across the world by making life more difficult for emerging market corporations and governments to service their debt. It’s one reason why the rate hiking cycles can sometimes help provoke problems like the “Tequila Crises” of 1994.

Of course, the Bank of Japan wouldn’t want a replay of that either.

How did we get here?

Fortunately for the Bank of Japan, markets are getting a bit of reprieve on Thursday with the weak U.S. economic data coming just before their big rate decision, according to Steve Englander, FX strategist at Standard Chartered Bank.

U.S. jobless claims lingered near five-month highs last week, and housing starts signaled that trouble could be brewing in the U.S. real-estate market (both of which could be construed as positive developments on the Federal Reserve’s agenda).

Japan and the BOJ fought for years to try to push inflation higher and return the Japanese economy to a state of more dynamic growth. Unfortunately, a slew of factors, including demographic issues, has held it back.

Now, the BOJ needs to find the sweet spot where it can accommodate investors demanding a dramatic policy shift, while also not ceding 100% of the control over the narrative to speculators and bond vigilantes.

“The problem with that is once you let go a little bit, the market anticipates that you will let go a lot,” Englander said. “Until you get to a level where the market says ‘this looks reasonable’ they’re going to be facing that pressure.”