Parleremo poco delle Banche Centrali, nei prossimi mesi.

La settimana prossima, in particolare, parleremo ancora di BCE, in vista della riunione di giovedì prossimo.

E poi basta: completato questo Post, per un paio di mesi non ci saranno altri commenti.

La ragione? Non c’è davvero più nulla da dire. Le Banche Centrali, nel corso degli ultimi mesi, hanno perso in modo progressivo ogni importanza, per i nostri investimenti, per i nostri portafogli, e per il futuri rendimenti.

Spieghiamo il perché. I dati, ormai, ci dicono tutto: non ci sono più dubbi, non ci sono più interpretazioni possibili, non ci sono più dibattiti. In aggiunta a questo, non ci sono più mosse, iniziative, spazi di manovra che le Banche Centrali possano agire. In poche parole: è finita.

Dice molto chiaramente Mohamed El Erian, qui sopra nell’immagine della settimana scorsa, che sono tre i fattori che hanno sostenuto i mercati finanziari nel primo semestre del 2021:

1. la forza della crescita economica

2. la convinzione che l’inflazione fosse “transitoria”

3. la fiducia che le Banche Centrali avrebbero mantenuto elevata la liquidità del sistema

Alla metà del mese di luglio 2021, si può affermare con certezza che:

1. nessuno crede più alla forza della crescita economica: non c’è, e non è mai esistito, un boom economico

2. tutti sappiamo che l’inflazione non è, e non è mai stata, transitoria

3. le Banche Centrali hanno enormi problemi con la liquidità elevata: anche, ma non solo, per ciò che sta scritto qui sopra al punto 2

In sostanza, possiamo affermare che le Banche Centrali, alla luce dei fatti come li conosciamo al luglio 2021, le hanno “cannate” tutte. Ma proprio tutte tutte. Proprio un anno fa in questo Blog vi abbiamo scritto che “la Federal Reserve è il peggiore nemico della vostra stabilità finanziaria”. Ed eccoci qui.

Per non ripetere cose che noi abbiamo già scritto, affidiamo all’articolo che segue il punto sui “temi di mercato” alla metà del luglio 2021.

Jeffrey Gundlach of DoubleLine Capital said it is no mystery why U.S. Treasury yields are anchored lower despite evidence that inflation is rising in an economy attempting to rebound from a stultifying pandemic.

Speaking to CNBC’s Halftime Report on Thursday, Gundlach said that the financial system remains awash with liquidity, i.e., willing buyers, who seem eager to purchase benchmark government debt, a factor that has been a key reason in driving prices up and yields commensurately lower.

“Yields are this low because of all the liquidity in the system,“ Gundlach told the business network.

The 10-year Treasury note was yielding around 1.32% Thursday afternoon after touching around 1.7% just about two months ago.

In theory, yields should be higher because the Federal Reserve has signaled that it is considering ending its asset-purchase program, which includes some $80 billion in Treasurys a month. The Fed’s quantitative easing, or QE, has helped support financial markets during the worst of the pandemic-driven disruptions last year.

But the prospect of the cessation of QE and surging inflation, which erodes a bond’s fixed value, should be sparking selling in Treasurys and pushing yields higher and prices lower.

Gundlach, however, said that buying from pension funds, foreign buyers and other investors continues to be robust and is providing substantial support for lower yields, even as the Dow Jones Industrial Average the S&P 500 index and the Nasdaq Composite are trading near record highs.

Gundlach said “banks are so flush with deposits” and that is creating dislocations in areas of financial markets. Indeed, demand in the New York Federal Reserve’s overnight reverse repo program (RRP) has begun flirting with record levels around $1 trillion.

The Fed’s reverse repo program lets eligible institutions, like banks and money-market mutual-funds, park large amounts of cash overnight at the Fed, at a time when short-term funding rates have fallen to next to nothing, and finding a home for cash has become harder.

The repo operations have been soaking up some of the excess liquidity currently overwhelming U.S. money-market funds, which have been flooded with cash this year, market participants note.

On Thursday, Federal Reserve Chairman Jerome Powell told Senate lawmakers, as a part of a semiannual report to Congress, that inflation has been a bit of surprise for monetary policy makers.

“This is a shock going through the system associated with reopening of the economy, and it has driven inflation well above 2%. And of course we’re not comfortable with that,“ Powell said.

That said, Powell, and other Fed officials, have characterized rising prices as temporary, highlighted by the consumer-price index climbing 0.9% in June, with the rate of inflation in the 12 months ended in June rising to 5.4% from 5%, marking the fastest climb since 2008, when oil hit a record $150 a barrel.

Gundlach says that pension funds aiming to invest the liquidity provided by fiscal stimulus during the pandemic have been increasingly turning to longer-dated Treasury buying.

Still, despite the anomalies taking shape in the market, the DoubleLine boss said that he was still a buyer of stocks. “I think you’re OK holding,” he said, noting that he has reduced his levels of cash and dialed up his equity holdings.

He said doing so was sensible until such time as the market gets more clarity on future federal spending plans.  

He said that he didn’t think inflation was going away but described a precarious situation for the U.S. central bank which may remove its accommodative measures to tamp down inflation only to risk seeing the still-unsteady labor market wobble.

Gundlach said that the Fed thus far has already proven itself wrong about one thing: its definition of “transitory.” He said that policy makers had initially described “transitory” as one or two months but “now transitory is six to nine months.”

I think that some Fed officials are coming around to the view that this “inflation is going to stay around longer than they thought.”

“Jay Powell is still wishing, hoping, praying that this [inflation thing] goes way,” Gundlach said.

“The bond market seems to be thinking that the Fed is going to get religion…about inflation,” he said

Nelle poche righe dell’articolo qui sopra, c’è tutta per intero l’attualità. L’oggi. Lo stato delle cose.

Come da sempre facciamo, noi qui nel Blog ci occupiamo invece del futuro: di quello che accadrà domani, e nei prossimi mesi, da qui alla fine dell’anno. Come detto (e come spiega anche benissimo l’articolo) ormai la Fed sta fuori da quadro, in un contesto come quello descritto dall’articolo non conta più nulla. Le sue scelte sono obbligate, le sue scelte sono limitate, e le sue scelte sono condizionate. La Fed è in un angolo, come questo Blog scriveva già mesi fa. Insomma: in questo preciso momento di mercato, la Fed non conta più nulla: è fuori dai giochi.

Guardando al futuro, ma riprendendo l’articolo che avete appena letto, c’è una cosa che va chiarita e precisata. Gundlach dice nell’articolo che “i rendimenti dei Titoli di Stato sono scesi a causa della abbondante liquidità nel sistema”. E si sbaglia.

I rendimenti dei Titoli di Stato sono scesi per una ragione diversa, e ben più importante: il mercato obbligazionario ha le idee chiarissime su una cosa. Che è la seguente: l’inflazione dovrà scendere, per forza: non c’è alternativa. Può scendere se rallenta in modo violento l’economia, può scendere se l’inflazione sale sopra il 10% e provoca un crash, oppure può scendere perché la Federal Reserve fa una completa marcia indietro sulla liquidità.

In entrambi i casi, l’economia rallenta, e di molto.

Ed ecco spiegati i rendimenti in discesa.

Questa considerazione spiega anche perché oggi, per noi investitori, la Federal Reserve non conta più nulla: non saranno loro a scegliere. Come scritto nell’articolo qui sopra, ogni giorno Jay Powell prega con le mani giunte che l’inflazione si fermi … da sola, ma non succederà. E saranno altri fattori, a decidere quello che poi accade: non sarà la Federal Reserve (né la BCE).

Per questa semplice ragione, nelle prossime settimane non commenteremo più la Federal Reserve: perché per le nostre e le vostre performances quello che dice oppure fa la Federal Reserve non conta.

E’ di altro, che oggi un investitore si deve occupare.

Per chiudere il Post, vi regaliamo in lettura un articolo pubblicato, pochi giorni fa (ma prima degli ultimi dati per l’inflazione), da Mohamed El Erian: dove trovate già scritto tutto, è sufficiente leggere in modo attento e non superficiale.

The writer is president of Queens’ College, Cambridge and an adviser to Allianz and Gramercy

The sharp drop in yields on US government bonds seen last week is good news for stock investors, or so you would think given recent experience. But that was not the feeling in markets on Thursday with a broad-based sell-off in equities, leading more people to start asking the key question of whether we could be having too much of a good thing — that is, interest rates that are artificially very low for too long.

The question becomes even more important as investors get ready to digest this week news on inflation and US Federal Reserve policy. Ten-year Treasury yields plummeted from around 1.70 per cent at the end of the first quarter to 1.25 per cent during Thursday’s trading session before recovering somewhat on Friday.

Three main explanations have been suggested for this counter-intuitive move given higher growth and inflation outcomes. The most worrisome is that the markets are pricing a significant deterioration in growth prospects due to less strong data in China and the US, and concerns about the spread of the Covid Delta variant in Europe and much of the developing world. Yet it is hard to argue that these headwinds to the global recovery warrant such a move down in yields, let alone the very low levels of both nominal and real rates.

The second is policy related, centred on the European Central Bank’s signal of a somewhat more dovish policy stance. Again, it is hard to argue consistency with the extent of the move. Also, the ECB announcement coincided with the release of Fed minutes that confirm a slightly less dovish tilt there.

The third, technicals-based explanation for the move down in yields seems more convincing. The more yields fall in such a counter-intuitive mode, the greater the pressure on those brave souls that were still betting bond prices would drop, or who were underweighting their benchmark indices. There might also have been belated buying from pension funds that have given up on waiting for better entry points to buy assets to match liabilities.

Indeed, the abrupt nature of last week’s market moves were consistent with “capitulation trades” — as in, “I don’t care about the levels, just get it done”. For a while now, stocks investors have embraced unnaturally low yields, the centrepiece of central banks’ prolonged reliance on unconventional policies. They reduce the debt burden of companies, allow for very easy debt refinancing and open up all sorts of possibilities for mergers and acquisitions as well as initial public offerings. They also facilitates good old-fashioned financial engineering that alters capital structure in favour of shareholders relative to creditors.

So what follows the markets’ sudden bout of indigestion? The most likely answer is a short-term rebound driven by three behavioural themes that have deeply conditioned investors: TINA, or there is no alternative to stocks with yields so very low; BTD, buy the dip as the liquidity wave continues; and FOMO, fear of missing out on yet another move up in stocks. While the most probable outcome in the short-term, this should not preclude forward-looking analyses of two associated risks.

The first relates to so-called “de-grossing” — that is, simultaneous reductions in risk-taking positions led by those have bet on an improving economy with the “reflation trade”. That would involve cutting overweight positions in risky stocks and underweight exposures in risk-free government bonds, the result of which would be adverse contagion for a bigger set of financial assets. The other, more worrisome possible future extension of recent events is that the economy and the financial system may have already experienced too much of a good thing.

With the Fed already behind on inflation and with supply side problems proving more persistent, there is growing concern that the more the central bank waits to taper its $120bn of monthly bond purchases the more likely it will be forced into slamming the policy brakes on at some point. In the meantime, speculative excesses would have built up further, more resources would have been misallocated across the economy, and more unsustainable debt would have been incurred. What is clear to me is that we are moving irresistibly closer to a critical question for the economy and markets, and not just in the US: is there still the possibility of an orderly exit from what has been a remarkably long period of uber-loose monetary policies?

Diciamolo chiaramente: “asset allocation” è una espressione che ,,, “fa figo”: dà importanza, ispira pensieri elevati, profuma di competenza.

Al di là dell’impatto fonetico ed emotivo, però, c’è poco: la “asset allocation” è un concetto che viene utilizzato a mani basse dalle Reti di vendita fatte di wealth managers, private bankers, promotori di ogni tipo, personal bankers e familiy bankers, per colmare un vuoto. Il loro vuoti di competenza.

La asset allocation, in questo contesto commerciale di vendita, è qualcosa di banale, un modo semplificato di intendere la gestione del portafoglio titoli. Qualcosa che potete farvi da soli, amici lettori, anche la mattina presto mentre vi fate le abluzioni con il collutorio. Sono sufficienti cinque minuti..

Mettete i vostri soldi un po’ di qui un po’ di là, di più in Europa, un po’ meno negli USA ed ancora meno sui mercati Emergenti, dividete tra azioni ed obbligazioni, un po’ di materie prime, e il gioco è fatto.

Potete farvela anche da soli, anche per il fatto che la “asset allocation” che vi propongono in massa tutti i venditori delle Reti e delle banche non funziona.

Non funziona per una lunga serie di ragioni, e noi in questo Blog ne scrivemmo in modo chiari ed approfondito già molti anni fa.

Oggi la realtà dei mercati finanziari ci fornisce nuovi spunti per ritornare su quelle nostre considerazioni di anni fa.

Quando il private banker, il wealth manager, il “consulente autorizzato alla vendita fuori sede” viene a trovarvi a casa, vi fa regolarmente vedere i soliti grafici colorati, che sono stati progettati dal loro ufficio marketing per convincervi che

• nel lungo periodo le azioni salgono sempre; e poi anche che

• se vuoi più rendimento in portafoglio metti più azioni, mentre se vuoi stare più al sicuro metti più obbligazioni

Tutte e due queste affermazioni sono false, e lo abbiamo già ampiamente documentato anche nel Blog e con molti dati (alcuni dei quali li leggete nuovamente nei grafici di questo Post)..

Oggi però, alla metà dell’anno 2021, è utile riprendere in considerazione la seconda delle due affermazioni.

Chi si è affidato alla seconda delle due affermazioni riportate sopra potrebbe ritrovarsi, già nel secondo semestre 2021, alle prese con problemi grandissimi, come spiega benissimo l’articolo che abbiamo scelto qui per voi.

There’s nothing more beautiful to a professional investor than a negative correlation between stocks and bonds. When stocks have a bad month, bonds have a good month, and vice versa. Since their zigs and zags offset each other, the value of the combined portfolio is less volatile. The customers are pleased. And that’s how it’s been for most of the last two decades.

But for almost a year now, Bloomberg market reporters have been detecting anxiety from the pros that the era of negative correlation may be over or ending, replaced by an era of positive correlation in which stock and bond prices move together, amplifying volatility instead of dampening it. “Bonds Have Never Been So Useless as a Hedge to Stocks Since 1999,” read the headline on one article this May.

Yet hope springs eternal. The headline on a July 7 article was, “Bonds Are Hinting They’ll Hedge Stocks Again as Growth Bets Ease.”

In the big picture and over long periods, it’s obvious and necessary that stock and bond returns are positively correlated. After all, they’re competing investments. Each generates a stream of income: dividends for (most) stocks, coupon payments for bonds. If stocks get very expensive, investors will shift money into bonds as a cheaper alternative until that rebalancing makes bonds more or less equally expensive. Likewise, when one of the two asset classes gets cheap it will tend to drag down the other. 

When the pros talk about negative correlation they’re referring to shorter periods—say, a month or two--over which stocks and bonds can indeed move in different directions. Lately two giant money managers have produced explanations for why stocks and bonds move apart or together. They’re worth understanding even if your assets under management are in the thousands rather than billions or trillions.

Bridgewater Associates, the world’s biggest hedge fund, based in Westport, Conn., says that how stocks and bonds play with each other has to do with economic conditions and policy. “There will naturally be times when they’re negatively correlated and naturally be times when they’re positively correlated, and those come from the underlying environment itself,” senior portfolio strategist, Jeff Gardner says in an edited transcript of a recent in-house interview. 

According to Gardner, inflation was the most important factor in the markets for decades—both when it rose in the 1960s and 1970s and when it fell in the 1980s and 1990s. Inflation affects stocks and bonds similarly, although it’s worse for bonds with their fixed payments than for stocks. That’s why correlation was positive during that long period.

For the past 20 years or so, inflation has been so low and steady that it’s been a non-factor in the markets. So investors have paid more attention to economic growth prospects. Strong growth is great for stocks but doesn’t do anything for bonds. That, says Gardner, is the main reason that stocks and bonds have moved in different directions.

PGIM Inc., the main asset management business of insurer Prudential Financial Inc., has $1.5 trillion under management. In a report issued in May, it puts numbers on the disappointment the pros feel when stocks and bonds start to move in sync. Let’s say a portfolio is 60% stocks and 40% bonds and has a stock-bond correlation of -0.3, which is about average for the last 20 years. Volatility is around 7%. Now let’s say the correlation goes to zero—not positive yet, but not negative anymore, either. To keep volatility from rising, the portfolio manager would have to reduce the allocation to stocks to around 52%, which would lower the portfolio’s returns. If the stock-bond correlation reached a positive 0.3, then keeping volatility from rising would require reducing the stock allocation to only 40%, hitting returns even harder.

PGIM’s list of factors that affect correlations is longer than Bridgewater’s but consistent with it. The report by vice president Junying Shen and managing director Noah Weisberger says correlations between stocks and bonds tend to be negative when there’s sustainable fiscal policy, independent and rules-based monetary policy, and shifts up or down in the demand side of the economy (consumption). The correlation is likely to be positive, they say, when there’s unsustainable fiscal policy, discretionary monetary policy, monetary-fiscal policy coordination, and shifts in the supply side of the economy (output).

One last thought: It’s a good idea to spread your money between stocks and bonds even if they don’t hedge each other. The capital asset pricing model developed by William Sharpe in the 1960s says everyone should have the same portfolio, consisting of every asset available, and adjust their risk by how much they borrow. True, not everyone agrees. John Rekenthaler, a vice president for research at Morningstar Inc., wrote a fun article in 2017 about the different strategies of Sharpe and fellow Nobel laureate Harry Markowitz.

La parte finale dell’articolo qui sopra cita Harry Markowitz e William Sharpe, due nomi che vi potranno essere utili per ricordare che per investire senza andare a sbattere contro il muto sarà utile non limitarsi a leggere quello che scrive il Trader Fenomeno nella chat della vostra piattaforma di trading. Si tratta di un invito quindi ad allargare l’orizzonte informativo,

Recce’d, per i propri Clienti, svolge anche questo ruolo di supporto, informativo ed anche formativo, ogni gionro, ogni settimana, ed ogni mese da oltre 13 anni.

Per i nostri amici lettori di questo Blog, l’articolo che segue (che sta nel nostro archivio, e che risale a cinque anni fa) può fare da utile esempio e lettura introduttiva a temi che risulteranno fondamentali nella gestione del portafoglio titoli nei prossimi mesi ed anni.

Should You Own the Market Portfolio?

Two Nobel Laureates, two answers.

John Rekenthaler

Aug 25, 2017

Most people who have studied investing believe that they should possess the market portfolio. With their U.S. stocks, they shouldn’t pick and choose; rather, they should own as many positions as possible, presumably through broad index funds. Ditto for their bonds as well as for their overseas holdings. This belief comes courtesy of Professor William Sharpe, who won a Nobel Prize for his troubles.

Of course, most investors don’t follow this precept precisely. They don’t hold a single broad-market index for each asset class. Nonetheless, if they invest through funds rather than through stocks directly, investors will end up owning something that approximates Sharpe’s recommendation.

They will pay more than the annual 3 basis points levied by  iShares Core S&P Total US Stock Market (ITOT) (catchy moniker that) or  Schwab US Broad Market (SCHB), and their portfolios will fluctuate around those benchmarks, but their results shouldn’t stray too far from the mark.

As my colleague Paul Kaplan (to whom this column owes a debt) reminds me, this faith in the market portfolio deserves some rocking. Critically, Sharpe’s conclusion when developing the Capital Asset Pricing Model—that the market portfolio was the single best portfolio for all investors—depends upon the assumption that investors can and will borrow to leverage their portfolios. In addition, the interest rate for their borrowing costs must be the risk-free rate.

Counterpoint
In practice, of course, most investors—even among institutions—don’t borrow, and if they do attempt such a thing, they are not granted the risk-free rate. This has a dire effect on the CAPM. Writes fellow Nobel Laureate Harry Markowitz (who received his award on the same day as Professor Sharpe), if we “take into account the fact that investors have limited borrowing capacity, then it no longer follows that the market portfolio is efficient.”

In fact, continues Markowitz, “This inefficiency of the market portfolio could be substantial and it would not be arbitraged away even if some investors could borrow without limit.” He then defends that statement formally, for those who enjoy such treatments. Suffice it to say that while the equations are past the scope of this column, the upshot is not: Markowitz was correct on the math. His results have not been challenged.

Better Betas?
Markowitz draws a straightforward investment conclusion. In the theoretical world of the CAPM, investors achieve extra return by borrowing to buy additional equities. That is, they increase their portfolios’ betas by putting more money to work at a beta of 1.0 (the market portfolio), rather than investing the same amount of money in stocks that have higher betas. In the actual world, not so much.

That is because without borrowing, only the latter strategy is possible. Those who accept the CAPM’s conclusion that beta alone determines a stock’s expected future returns, and who are willing to accept above-market risk in exchange for potentially above-market gains, must purchase higher-beta equities. No ifs, ands, or buts. That is their only choice. Such investors must reject the market portfolio by doubling down on volatile stocks and skipping the tame ones.

The problem is, such behavior introduces pricing distortions. If enough investors adopt this mindset—a likely occurrence, given how many assets are held either by institutions that have very long time horizons, or individuals who have decades of expected life remaining—then higher-risk stocks will become overbought. Too much money will crowd into the same subset of securities, which will reduce their expected returns. Conversely, the low-beta stocks will be relatively neglected, and will outdo their forecasts.

Those results have indeed occurred since the CAPM was introduced, leading some to speculate that Markowitz got it right, even if he didn’t form his argument as a prediction. Readers appreciated the CAPM’s logic, which earned Sharpe fame, but the publication of the theory didn’t much change their habits. For the most part, those who sought greater returns continued not to leverage their portfolios, and continued to seek extra profits by purchasing riskier stocks. The stock market acted largely as it always did.

Creating Ripples
The effect of restricting leverage doesn’t stop there. For every pricing distortion, the financial markets have a potential counter-distortion—a reaction against the original movement. That is, if higher-beta stocks did indeed become overpriced due to excess demand and lower-beta stocks underpriced (only a hypothesis—this is not a topic that lends itself to proof), and investors perceive that pattern, then stock buyers may change their collective behavior. Perhaps they will flock to low-beta stocks.

Which then might cause further reverberations. None of which matter for the purposes of this discussion. The point is, once the door is opened such that some participants should refuse to hold the market portfolio, then all manner of beasties can slip into the room. The theory does not permit the halfway—either it holds, or it doesn’t hold. And it doesn’t hold.

Getting Personal
None of which, of course, demonstrates that buying the market portfolio is a mistake, or that thinking of such a position as a “neutral” starting point is wrong. The market portfolio may well be an appropriate choice, and it surely is the most sensible of starting points. The prospective investor in U.S. stocks has several thousand publicly traded alternatives. Absent further information, the most-logical portfolio is that which owns them all, in proportion to their worth.

However, there is further information. In addition to Markowitz’s observation, which affects all market participants (the pricing of high-beta securities being independent of one’s individual circumstances), there are a host of personal factors that could lead the logical investor to deviate from the market portfolio.

Ottanta giorni: in ottanta giorni, tutto è cambiato.

Soltanto chi è ingenuo (ma davvero molto ingenuo), oppure disinformato (ma davvero poco informato) oppure malintenzionato (uno che deve vendere i Fondi Comuni e la asset allocation) poteva dirsi convinto del “boom economico 2021”,

Il “boom economico 2021” è stata una invenzione della fantasia dei banchieri centrali, dei promotori finanziari, dei Governi e delle banche di investimento come Goldman Sachs. Il vostro private banker non si è lasciato scappare l’occasione, ha fatto finta di essere (completamente) tonto e vi ha convinti ad “investire”. Su che cosa? ma sul “boom economico 2021”.

Immaginiamo la vostra faccia, in qualche caso attonita, in qualche caso spaventata, e comunque con una espressione non delle vostre migliori, quando avete letto sui quotidiani i titoli che si leggono oggi, alla metà di luglio 2021.

Voi non lo sapete, il vostro promotore finanziario non ve lo dirà mai, il vostro private banker ve lo nasconderà fino all’ultimo momento, ma sui mercati finanziari ci sono quelli che parlano di un quarto trimestre 2021 con la crescita del PIL NEGATIVA per gli Stati Uniti.

In Europa? Figuriamoci: in Europa è stata negativa tra gennaio e marzo, che problema c’è a rifarlo?

E quindi, era tutta … una balla? Il boom economico, che era nei titoli di ogni ricerca di Goldman Sachs, di Morgan Stanley, di JP Morgan, di UBS, di Credit Suisse, di FINECO, di Mediolanum, di Fideuram, di Banca Generali, di Allianz, di Azimut ancora ad aprile, oggi è svanito? Era solo un miraggio?

Il problema è vostro, e non nostro: in Recce’d noi abbiamo scritto già a inizio 2021 che non ci sarebbe stato il “boom economico 2021”, ed i portafogli dei nostri Clienti sono già perfettamente sistemati, e fino dalla metà di aprile 2021.

Il problema invece è vostro: se continuate ad affidare i vostri soldi a questi clown, a persone che hanno già dimostrato di NON avere le qualità per comprendere ciò che succede nella realtà, oppure che vi hanno già dimostrato di parlare unicamente a favore del loro stesso interesse, anziché consigliarvi per rendere massimo il vostro risultato (risk-weighted, ovviamente), in quel caso nessuno vi può aiutare.

La testa che sta sotto la ghigliottina, è la vostra: vi suggeriamo di tirare su la vostra testa, e vi aiutiamo regolarmente mettendo a vostra disposizione articoli selezionatissimi come quello che segue. Per il resto, vedete un po’ voi.

For months, the United States has been experiencing the growing pains of an economy rebooting itself — surging economic activity, yes, but also shortages, gummed-up supply networks and higher prices.

Now, shifts in financial markets point to a reversal of that economic narrative. Specifically, the bond market has swung in ways that suggest that a period of slower growth and more subdued inflation could lie ahead.

The yield on 10-year Treasury bonds fell to 1.29 percent on Thursday, down from a recent high of 1.75 percent at the end of March and the fourth straight trading day of decline. The closing price of inflation-protected bonds implied expectations of consumer price inflation at 2.25 percent a year over the coming decade, down from 2.54 percent in early May.

These are hardly panic-worthy numbers. They are not the kind of jaw-dropping swings that markets show in moments of extreme turbulence, and analysts attribute the moves in significant part to technical factors as big investors shift their portfolios.

Moreover, there is a reasonable argument that the economy will be better over the medium term if it experiences moderate growth and low inflation, as opposed to the kind of breakneck growth — paired with shortages and inflation — seen in the last few months.

But the price swings do show an economy in flux, and they undermine arguments that the United States is settling into a new, high-inflation reality for the indefinite future.

In effect, the bet in markets on explosive growth and resulting inflation is giving way to a more mixed story. The economy remains hot at the moment; the quarter that just ended will most likely turn out to be one of the strongest for growth in history. But market prices aim to reflect the future, not the present, and the future is looking less buoyant than it did not long ago.

The peak months for injection of federal stimulus dollars into the economy have passed. The legislative outlook for major federal initiatives on infrastructure and family support has become murkier. The rapid spread of the Delta variant of Covid-19 has brought new concern for the global economic outlook, especially in places with low vaccination rates. That, in turn, could both hold back demand for American exports and cause continued supply problems that result in slower growth in the United States.

“The overriding concern being reflected in the bond market is that peak growth has been reached, and the benefits from fiscal policy are starting to fade,” said Sophie Griffiths, a market analyst with the foreign exchange brokerage Oanda, in a research note.

The evidence of a more measured growth path was evident, for example, in a report from the Institute for Supply Management this week. It showed the service sector was continuing to expand rapidly in June, but considerably less rapidly than it had in May. Anecdotes included in the report supported the idea that supply problems were holding back the pace of expansion.

“Business conditions continue to rebound; however, like everywhere, the challenges in the supply chain are numerous,” reported one anonymous retailer that participated in the I.S.M. survey. “We continue to see cost increases, delayed shipments, pushed-out lead times, and no clarity as to when predictive balance returns to this market.”

The bond market shifts could leave the Federal Reserve wrong-footed in contemplating plans to unwind its efforts to support the economy. At a policy meeting three weeks ago, some Fed officials were ready to proceed with tapering bond purchases in the near future, and some expected to raise interest rates next year, in contrast with a more patient approach that Jerome Powell, the Fed chairman, has advocated.

In one of the odder paradoxes of monetary policy, what was perceived in markets as greater openness at the Fed to raising interest rates has contributed to declines in long-term interest rates. Global investors are betting that potential pre-emptive monetary tightening will cause a stronger dollar, slower growth and less ability for the Fed to raise rates in the future without tanking the economy.

“The market read the views of the minority within the Fed about tapering and about raising rates as signals the Fed has blinked on its decision to allow the economy to run hot,” said Steven Ricchiuto, chief U.S. economist at Mizuho Securities. “A weaker global economy and stronger U.S. dollar all imply greater potential for us to import global deflation.”

There are silver linings to the reassessment taking place in markets. Lower long-term rates make borrowing cheaper for Americans — whether that is Congress and the Biden administration considering how to pay for infrastructure plans, or home buyers trying to afford a house.

And the adjustment in bond prices can give Fed officials more confidence that inflation is set to be consistent with their goals in the years ahead, even as businesses face supply shortages and spiking wages at the moment.

For example, bond prices now imply that inflation will be 2.1 percent per year between five and 10 years from now, down from expectations of 2.4 percent in early May. The Fed aims for 2 percent inflation (though targeting a different inflation measure from the one that is used in the value of inflation-protected bonds).

That could make it less likely the Fed acts prematurely out of fear that inflation will get out of control, recent communication problems notwithstanding.

Markets aren’t all-knowing, and the signals being sent by bond prices could turn out to be wrong. But investors with, collectively, trillions of dollars on the line are betting that the rip-roaring economy of summer 2021 is going to give way to something a good bit less exciting

Se questo articolo non vi risulta chiaro a sufficienza, se non riuscite a tradurlo immediatamente in indicazioni operative, se non siete in grado di utilizzarlo per comprendere se le vostre mosse più recenti (quelle fatte sulla base delle indicazioni del vostro private banker o wealth manager, quelle che avete fato per “dare retta” al solito promotore finanziario) sono o meno mosse azzeccate e prudenti, allora vi suggeriamo di leggere anche ciò che ieri è stato scritto a proposito degli utili delle Società quotate dal settimanale The Economist.

Un articolo che via aiuterà anche ad interpretare i dati pubblicati nelle prossime settimane, dalle Società quotate negli Stati Uniti e in Europa, per i risultati trimestrali del trimestre aprile-giugno.

E così, finalmente capirete se avete fatto bene, o meno, ad “aumentare l’azionario” nella prima parte del 2021. Con tanti auguri, ovviamente.

It is mid-july, so the football season in England will start soon. You probably hadn’t noticed it had ended. The earnings season, when listed companies in America reveal their quarterly results, comes round with similarly tedious frequency and also never seems to stop. The second-quarter season that kicks off this week ought to stand out, though. Public companies in aggregate are expected to reveal the largest increase in profits since the bounce-back from the Great Recession of 2008-09.

Optimism about earnings has driven share prices higher in the past year. But financial markets are relentlessly forward-looking. And with bumper earnings already in the bag, they now have less to look forward to. A rally in bond prices since March and a sell-off in some cyclical stocks point to concerns about slower gdp growth. A plausible case can be made that the earnings outlook might worsen as quickly as it improved.

Start with the bottom-up forecasts for profits by company analysts. They expect earnings per share for the msci world index of stocks to rise by 40% in 2021, according to FactSet, a data provider. That is a good deal higher than at the start of the year, when the forecast was around 25%. A slowdown to a growth rate of 10% is expected in 2022. Then again forecasts tend to start out at 10%, a nice round number, before being revised upwards (as in, say, 2017) or downwards (as in 2019) as news comes in.

Profits swing around a lot. For big businesses, a lot of costs are either fixed or do not vary much with production. Firms could in principle fire workers in a recession and hire them back in a boom so that costs go up and down with revenues. But this is not a great way to run a business. A consequence of a mostly stable cost base is that, when sales rise or fall, profits rise and fall by a lot more. This “operating leverage” is especially powerful for companies in cyclical businesses, such as oil, mining and heavy industry. Indeed, changes in earnings forecasts are largely driven by cyclical stocks.

If global gdp growth falls, then profits will fall faster. There is already some evidence of a slowdown. The output and orders readings in the global manufacturing purchasing managers’ index (pmi), a closely watched marker of activity, fell in June. Global retail sales surged in March, but have gone sideways since. The evident slowdown in China’s economy may be a portent, writes Michael Hartnett of Bank of America. China emerged from lockdown sooner; its pmi peaked earlier; and its bond yields started falling four months before Treasury yields did.

Slower economic growth is one part of a classic profit squeeze. The other is rising costs. A variety of bottlenecks have pushed up the prices of key inputs, such as semiconductors. Too much is made of this, says Robert Buckland of Citigroup, a bank. Input prices typically go up a lot in the early stages of a global recovery. Big listed companies usually absorb them without much damage to profits. Rapid sales growth trumps the input-cost effect. The real swing factor is wages, which are the bulk of firms’ costs. The recovery is barely a year old, but there is already evidence of a tight labour market.

In America the ratio of vacancies to new hires, a measure of the difficulty firms have in filling jobs, reached a record in May. Businesses that were forced to close during lockdowns have lost some workers to other industries. Others are dropping out of the labour force altogether. Thanks to the recent surge in the prices of assets, including homes, some people are choosing to retire early, says Michael Wilson of Morgan Stanley.

An obvious remedy for rising costs would be to raise prices. Though inflation is surging in America, that reflects price rises for a small number of items. Many businesses tend not to raise prices straight away. They are mindful of losing customers to rivals who don’t raise prices. And there are administrative costs to changing prices frequently. A study publishedin 2008 by Emi Nakamura and Jon Steinsson, two academics, found that the median duration of prices is between eight and 11 months. Prices of food and petrol change monthly but those of a lot of services only change once a year.

A profits squeeze is not certain. Any number of influences could give fresh impetus to global gdp growth: a bumper infrastructure bill in America; more policy stimulus in China; or some concrete signs that supply bottlenecks are easing. Still, while the earnings season now under way ought to be a sunny one, margins look vulnerable.

Improvvisamente, il giorno 8 luglio 2021, arriva in prima pagina su tutti i quotidiani, incluso il vostro, che esistono “timori per la crescita economica”, come viene sintetizzato, in modo eccellente, dall’immagine qui sopra.

Ritorniamo indietro di tre mesi; sono solo 90 giorni.

90 giorni fa, questo problema non esisteva, neppure all’orizzonte: al contrario, tutti i titoli, di tutti i quotidiani, e di tutte le banche globali di investimento, ed anche della vostra Rete di private banking, di wealth manager, di promotori finanziari, tutti ma proprio tutti parlavano del “boom economico”. E vi dicevano di investire “puntando sul boom economico”.

Ma non basta: 90 giorni fa, solo 90 giorni fa, non esisteva neppure l’inflazione: la previsione ufficiale della Federal Reserve, 90 giorni fa, era di una inflazione al 2% nel 2021. Solo tre mesi fa.

Oggi, siamo al 5%, e vedremo che cosa dirà il dato della settimana prossima. la Federal Reserve nel frattempo ha rettificato le proprie previsioni ufficiali, portandole dal 2% al 3,4%. Se vi sembra poco …

Insomma, era tutta una burla, una sciocchezza, una presa in giro.

Ma solo 90 giorni fa chi era, oltre a Recce’d ad esprimere scetticismo sulle previsioni “ufficiali”? Nessuno.

Domanda inevitabile: siamo noi, ad essere dei geni (poco probabile) oppure sono le Banche Centrali, Goldman Sachs, e poi Fideuram, Mediolanum e FINECO (tre nomi scelti tra i tanti), che fanno i… i finti tonti allo scopo di ingannare l’investitore finale?

In Recce’d, nessuno pensa di essere “un genio” (per carità …) ma i dati, quelli almeno bisogna leggerli, ogni giorno, e analizzarli, e interpretarli: non si può mica investire … ad orecchio, o peggio a spanne.

Se leggete con attenzione i dati, come a titolo di esempio quelli del grafico qui sotto, non vi sarà difficile comprendere perché, in soli tre mesi, in 90 giorni, il quadro si è ribaltato.

Non c’è bisogno di consultare un professore di economia per comprendere che, se le vendite al dettaglio esplodono (grazie ai sussidi pubblici) ma il mondo del lavoro resta sotto-occupato, nessuno produrrà le merci che poi il pubblico compera. Non è difficile.

Allo stesso modo, non è difficile leggere i dati del grafico che segue: non serve essere scienziati.

Se fate ogni mattina questo lavoro (oppure almeno se il vostro wealth manager lo facesse …) allora non vi stupireste del fatto che mentre le previsioni “ufficiali” parlano di economia che “cresce più rapidamente” (come vedete sotto nel grafico) al contrario sui mercati si discute del tema esattamente opposto.

E d’altra parte, sarebbe stato sufficiente leggere i dati dell’Istituto USA di statistica, quello ufficiale, che poi sarebbe l’equivalente americano dell’ISTAT, per vedere che c’è qualcosa che proprio non torna, nella storia del “boom economico senza inflazione”: Anche qui, è molto semplice: è sufficiente leggere o dati nel cerchietto giallo dell’immagine qui sotto. Li può leggere chiunque.

Siamo volutamente sintetici, in questo Post, per due ragioni

1. la prima ragione è che di questo argomento recce’d ha scritto, anche nel suo Blog, già mesi fa, ed è inutile ripetere cose già dette con largo anticipo in modo particolare nel nostro recentissimo Longform’d, qui nel Blog

2. la seconda ragione è che le analisi più approfondite sono, e ci mancherebbe altro, riservate esclusivamente ai Clienti.

A voi lettori del Blog rimangono le analisi del promotore finanziario, del wealth manager, del private banker e perché no del robot advisor. Oppure potreste (finalmente) ragionare con la vostra testa.

Anche oggi Recce’d vi regala, del tutto gratuitamente, uno spunto: se volete rendervi conto di ciò che fate, se volete comprendere come avete investito i soldi, se volete stimare quale sarà il vostro rendimento di fine 2021, … occupatevi di quello che sta succedendo in Cina.

Per voi investitori e per noi gestori, oggi la Cina è di gran lunga più importante, in termini di performance e di risultati, sia dell’Europa sia degli Stati Uniti.

Per questo, vi offriamo in lettura qui sotto un articolo pubblicato proprio ieri.Il nostro commento poi riprende più in basso

China’s central bank cut the amount of cash most banks must hold in reserve, a move that went further than many economists had expected and suggested growing concerns about the economy’s faltering recovery.

The People’s Bank of China will reduce the reserve requirement ratio by 0.5 percentage point for most banks, according to a statement published Friday. That will unleash about 1 trillion yuan ($154 billion) of long-term liquidity into the economy and will be effective on July 15, the central bank said.

The reduction was signaled earlier this week, when the State Council, China’s equivalent of a cabinet, hinted the central bank would make more liquidity available to banks so they could lend to smaller firms hurt by rising costs. The timing and magnitude of the move, coming a week before second-quarter growth data, suggests worries about the economy’s outlook and was a decisive shift away from policy tightening, economists said.

“The PBOC came in broader and sooner than expected, highlighting the policy urgency to support the China economy,” said Ken Cheung, chief Asian FX strategist at Mizuho Financial Group Inc. “Such firm easing measures could further fuel concern over China’s growth outlook in the second half as well as the upcoming second-quarter GDP figures in the coming week.”

The last time the bank cut the main ratios was during the first wave of the pandemic in 2020, when it was trying to boost the economy after lockdowns to contain the Covid-19 outbreak. After a strong rebound, the economic recovery has shown signs of faltering recently, with soaring commodities hurting businesses and the services industry taking a knock because of subdued consumer spending and sporadic virus outbreaks.

Economists surveyed by Bloomberg expect next week’s data to show GDP growth slowed to 8% in the second quarter from record expansion of 18.3% in the previous three months, though the latter data were distorted by base effects.

The PBOC’s move puts it at odds with other central banks, like the U.S. Federal Reserve, which is discussing tapering its bond-buying program as it tries to exit from its pandemic stimulus. China’s central bank had been ahead of its peers in scaling back stimulus, and its about-turn now shows the difficulties policy makers will face in withdrawing support while the Covid-19 pandemic continues to rage.

China is wary of overstimulating the economy though, and the central bank said in a statement that the cut doesn’t mean there’s been a change to the “prudent monetary policy.” The PBOC will maintain the “stability and effectiveness of monetary policy, keep a normal monetary policy, and won’t flood the economy with stimulus,” it said.

What Bloomberg Economists Say...

The People’s Bank of China’s isn’t taking any chances with the recovery -- the surprise 0.5 percentage point cut to the required reserve ratio will inject 1 trillion yuan into the banking system, helping juice growth that’s poised to slow in the second half. The RRR cut and a larger-than-expected jump in June credit mark a decisive turn to an easing stance.

David Qu, China economist

For the full report, click here.

Overall liquidity in the economy will basically be stable, as the extra funds will be used to repay maturing medium-term loans, fill any liquidity gaps due to the tax season from mid to late July, and raise long-term capital, the bank said.

A reserve ratio cut, while not immediately lowering the cost of borrowing in China, is a rapid way of freeing up cheap funds for lending and has been a favored tool in the central bank’s efforts to control the economic slowdown in recent years.

“The magnitude of the RRR cut is more than expected. The RRR reduction paints quite a stark contrast to PBOC’s very cautious stance on its liquidity injections in the first half of the year,” said Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered Plc in Hong Kong. “Even though the central bank said the cut shouldn’t be seen as a sign it’s shifting its policy stance, the market will interpret the move as a tilt toward looser monetary policy in the second half.”

The announcement came just after the release of data showing that credit growth in June was much stronger than expected, with much of that expansion coming from bank loans.

The RRR cut comes against the backdrop of stable interest rates. The PBOC has refrained from changing its policy rates since cutting them early last year during the height of the pandemic in China. It gradually tightened monetary policy since late 2020 through guiding credit growth lower. The PBOC has also offered annual RRR discounts to qualified lenders since 2017 as part of an “inclusive financing” program to help guide funds to flow into corners of the economy where credit is traditionally scarce.

Tommy Wu, lead Economist with Oxford Economics, said he doesn’t expect broad-based easing from the PBOC as the recent waning in growth was likely due to temporary issues.

“The recent economic slowdown was caused largely by new Covid-19 related restrictions and supply chain hiccups, including the temporary closure of Shenzhen port after a local coronavirus outbreak,” he said. “Monetary easing won’t help much in such circumstances, and the downward pressures should be temporary.”

— With assistance by James Mayger, Yujing Liu, Tian

Quei furbacchioni dei banchieri centrali naturalmente hanno già fiutato l’aria, ed hanno già cambiato registro: notate qui sotto come, all’istante, nelle parole dei Governatori della Federal Reserve sia ritornato il tema “COVID” che solo 90 giorni fa era stato “seppellito” come argomento di un passato destinato a non ritornare mai più.

Per loro, per la Federal Reserve come per la BCE come per la Banca del Giappone, l’epidemia è stata una benedizione: liberi di fare tutto ciò che vogliono, senza rispondere a nessuno, fuori da ogni vincolo di legge. E soprattutto, lasciandosi alle spalle il passato, come se il passato non fosse mai esistito. Chi ha avuto ha avuto, chi ha dato, dieci anni di QE non hanno risulto nulla: ma noi facciamo un QE ancora più grande, e raddoppiamo la posta.

Scommesse fatte sulla pelle degli altri, ovviamente.

L’uscita del Governatore della Federal Reserve qui sopra è notevolissima, perché ha del tutto spiazzato l’industria, e le grandi banche di investimento in modo particolare: che adesso, saranno costrette a rincorre ed a riallinearsi, come fanno ogni volta.

Vi ricordiamo infatti (sotto) che soltanto 10 anni fa la banca JP Morgan per bocca di uno dei suoi più conosciuti analisti aveva scritto: “La variante Delta non sarà un problema per i mercati finanziari”.

Tutto quanto dove ci lascia? Dove ci aveva già lasciato qualche settimana fa il nostro nuovissimo Longfrom’d, e dove ci lascia anche il (chiarissimo) intervento di Mohamed El Erian qui sotto: la “narrativa” del primo trimestre era instabile e quindi destinata a sgretolarsi.

Della prima metà del 2021 sui mercati finanziari, il fatto memorabile è uno, ed uno solo, Lo vedete qui sotto nei due grafici.

Il secondo dei due grafici qui sopra vi informa che la quantità di denaro che è affluito vero i Fondi Comuni azionari, nella prima metà del 2021, è superiore al totale dei 20 anni precedenti.

Per conseguenza, i Clienti individuali oggi, nella loro asset allocation, hanno una quantità eccezionale di azioni ed investimenti azionari (attraverso Fondi Comuni ed Unit linked) Lo vedete sotto nel grafico.

Il dato è clamoroso, storico persino, per la ragione che le Borse, nel primo semestre, di fatto non si sono mosse: i rialzi che sono stati registrati dai maggiori indici fanno ridere, se messi a confronto con questi dati.

E quindi: chi ha venduto, nel primo semestre?

Ma c’è una seconda ragione, che rende storico ed indimenticabile questo periodo: tutti questi piccoli e medi investitori hanno investito in Borsa convinti di guadagnare. Non sanno nulla, di Borsa, e di sicuro non sanno nulla dei dati qui sotto.

Questi piccoli e medi investitori sono stati convinti da personaggi privi di professionalità e spregiudicati che le loro posizioni azionarie avrebbero portato all’investitore dei grandi guadagni: ma non succederà, e per capirlo è sufficiente dare uno sguardo al grafico qui sotto.

La storia stessa dei mercati finanziari ci dice che il rendimento di questi investimenti in Borsa sarà pari a zero, ma solo se tutto di tutto filerà liscio. In tutti gli altri casi sarà sotto zero.

A questi investitori sarebbe molto utile riflettere sul fatto che un modestissimo ribasso dello 1,5% degli indici di Borsa, giovedì 8 luglio 2021, ha immediatamente fatto comparire, su tutti i siti e sulle prime pagine dei quotidiani, titoli “da panico” come quello che vedete qui sotto.

A questi investitori noi suggeriamo di riflettere con attenzione sul fatto che un piccolissimo ribasso degli indici di Borsa ha trovato tutte le banche globali di investimento immediatamente pronte a rovesciare la giacchetta, tirando fuori dai cassetti (dove erano già preparate) le ricerche che mettono in evidenza le “anomalie” e le “analogie con la bolla dot.com”., come vedete sotto.

A questi investitori, che si aspettano l’impossibile dai propri recenti investimenti, consigliamo di cambiare al più presto strada, e portafoglio.

A tutti questi investitori noi consigliamo di leggere con attenzione le analisi di chi ha da tempo messo in evidenza “la fragilità dello scenario di boom economico con bassa inflazione”. Tre mesi fa, c’era soltanto Recce’d, adesso c’è una buona percentuale degli analisti.