Independent Insight Provider

Stewart Paterson

Taurus Advisors LLP

Macroeconomics

The trade weighted dollar Index is within a whisker of breaking out of its two year long consolidation phase. There are two fairly imminent catalysts that could give the dollar a final push through resistance and lead it to trend higher: The Italian referendum on constitutional reform on 4th December and the FOMC meeting on December 14th. Although in theory the Italian referendum actually has nothing to do with Italy's continued membership of the Eurozone and hence the EU (remember Greece was…

The trade weighted dollar Index is within a whisker of breaking out of its two year long consolidation phase. There are two fairly imminent catalysts that could give the dollar a final push through resistance and lead it to trend higher: The Italian referendum on constitutional reform on 4th December and the FOMC meeting on December 14th. Although in theory the Italian referendum actually has nothing to do with Italy's continued membership of the Eurozone and hence the EU (remember Greece was…

Money Matters: The Road to Italeave and a Dollar Break-Out?

Amareos

Ryan Shea

Thematic (Sector/Industry)

Europe’s banking sector is back in the spotlight – and, once again, it is for less than positive reasons. Unlike earlier episodes, however, the focus is not on the periphery of the region but its heartland, specifically Deutsche Bank (DB).  The catalyst for the sell-off in DB’s share price, which has slumped to multi-decade lows, was news that the US Justice Department intends to fine the bank USD 14bn for alleged misspelling of mortgage-backed securities.However, examining trends in crowd-sourced sentiment indicators it is clear that concerns about DB are hardly new and certainly pre-date the announcement of the fine. Both Stress and Fear towards DB have been in an uptrend since May 2015 and Sentiment and Optimism in negative territory since July last year (when DB’s share price was trading three times higher than its current market price).These crowd sentiment trends matter because commercial banks are different from almost any other type of private company in one very important respect. For a bank, even one the size of DB, confidence its greatest and most critical asset. And, just like trust, confidence is nebulous, fickle and asymmetric; that is to say, hard to acquire but quickly lost.As a result, banking sector crises tend to be highly non-linear. A non-linearity that stems from the fact that behaviour at such times is dominated by psychology, something the crowd-sourced sentiment indicators we track at Amareos are ideally suited to monitor.

Europe’s banking sector is back in the spotlight – and, once again, it is for less than positive reasons. Unlike earlier episodes, however, the focus is not on the periphery of the region but its heartland, specifically Deutsche Bank (DB).  The catalyst for the sell-off in DB’s share price, which has slumped to multi-decade lows, was news that the US Justice Department intends to fine the bank USD 14bn for alleged misspelling of mortgage-backed securities.However, examining trends in crowd-sourced sentiment indicators it is clear that concerns about DB are hardly new and certainly pre-date the announcement of the fine. Both Stress and Fear towards DB have been in an uptrend since May 2015 and Sentiment and Optimism in negative territory since July last year (when DB’s share price was trading three times higher than its current market price).These crowd sentiment trends matter because commercial banks are different from almost any other type of private company in one very important respect. For a bank, even one the size of DB, confidence its greatest and most critical asset. And, just like trust, confidence is nebulous, fickle and asymmetric; that is to say, hard to acquire but quickly lost.As a result, banking sector crises tend to be highly non-linear. A non-linearity that stems from the fact that behaviour at such times is dominated by psychology, something the crowd-sourced sentiment indicators we track at Amareos are ideally suited to monitor.

Sweden

Investor AB is an industrial holding company. The Company owns significant shareholdings in major public multinational companies and conducts private equity activities in Europe, North America, and Asia. Investor takes an active ownership role in many of the companies it owns.

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Money Matters: The Road to Italeave and a Dollar Break-Out?

The trade weighted dollar Index is within a whisker of breaking out of its two year long consolidation phase. There are two fairly imminent...

Stewart Paterson

The Confidence "Interval"

Europe’s banking sector is back in the spotlight – and, once again, it is for less than positive reasons. Unlike earlier episodes, however, the...

Amareos

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