Perspectives Blog

The beginnings of a new moderation in Asia

Soo Nam Ng, Head of Asian Equities | June 2, 2014

…urce of the Great Moderation although the GFC was unfortunate and arguably avoidable had policymakers been more vigilant. Nonetheless, the lessons of the GFC help to drive home the point that policymakers need to focus on the sustainability of growth, not just growth per se. A firm commitment to this “sustainability” mindset is important as a starting point for policy-engineered ‘great moderation’ dynamics to kick in. Current observations in Asia…

Harvesting a New Moderation in Asia

Soo Nam Ng, Head of Asian Equities | June 23, 2014

…tal expenditure, which means de-bottlenecking projects takes precedence over projects which need longer term projections to justify commercial viability. A sustained harvest A new moderation in Asia’s growth, characterized by sustainability at a stabilized level rather than a rebound, may help dull the threat of complacency creeping in. It allows for the adaptive mindset to become more entrenched as the alertness to such a need is reinforced agai…

Finding opportunity in Chinese reforms

Robert McConnaughey, Director of Global Research | June 16, 2014

…h sweeping, definitive clarity. While there is growing optimism from local observers about government intent and will, much uncertainty remains. Important tangible steps have actually been taken already and a path to economic sustainability will require significantly more actions. However, a strong desire to maintain high near-term growth levels seems likely to lead to a measured pace of implementation. If there is one simplifying theme, it’s tha…

Tri-state pension reforms result in improvements

Matt Stephan, Analyst, Tax-Exempt Fixed-Income Research | April 11, 2014

…y in New Jersey and Connecticut, where ARC funding had slipped in favor of short-term budgetary relief. We believe that, while in some cases extremely painful in the short-term, improved annual funding is key to the long-term sustainability of these pension plans and that full ARC funding should lower unfunded liabilities in the long-term, provided various actuarial assumptions are met. Sources: Fiscal 2013 State CAFRs, Fiscal 2014 State Budge…

When the QE tide recedes, focus on what is revealed

Robert McConnaughey, Director of Global Research | January 6, 2014

…across emerging financial markets. However, investor concerns about declining global competiveness and stalling structural advancements began to accelerate in 2013. Recently announced reforms in China may help to lend greater sustainability to the Chinese growth story, but the details around implementation will be crucial not only to Chinese prospects (where market valuations reflect a great deal of skepticism), but to many other nations and econ…

From tactical to core – The case for emerging market debt

Columbia Management, Investment Team | June 2, 2014

…nd technical factors are more supportive. However, EMD has become less homogeneous at a credit level. Making the right country calls has never been more important as the status of EM country growth trends, balance of payments sustainability and overall economic resilience is significantly more divergent than it was five years ago. This divergence favors an investment manager who focuses on fundamental country and credit research and has the flexi…