Global Multi-Asset Investment Strategist, True Insights

Jeroen Blokland

Global Multi-Asset Investment Strategist

Build Well-Diversified Multi-Asset Portfolios

True Insights

Our research helps investors build well-diversified multi-asset portfolios and profit from market developments. In addition, our unique and proven Macro – Sentiment – Valuation (MSV) investment framework ensures a consistent flow of new investment opportunities. Together with our market views, these opportunities will be reflected in our live ETF-based Global Multi-Asset Portfolios.

Cross Asset Strategy

<ul>
<li>Financial markets are increasingly being dominated by headlines from China, where it is becoming clearer every day that the country is facing a historic real estate recession.</li>
<li>Despite the barrage of stimulus measures, Chinese and Emerging Market equity indices are trending down and is now within 1.5% of the 200-day moving average.</li>
<li>The 200-day moving average is a powerful sentiment indicator, distinguishing between positive and negative market returns.</li>
</ul>


Financial markets are increasingly being dominated by headlines from China, where it is becoming clearer every day that the country is facing a historic real estate recession.
Despite the barrage of stimulus measures, Chinese and Emerging Market equity indices are trending down and is now within 1.5% of the 200-day moving average.
The 200-day moving average is a powerful sentiment indicator, distinguishing between positive and negative market returns.


China’s Ongoing Real Estate Disaster Is Pushing Emerging Markets to the Brink

<ul>
<li>Unlike many suggest, the downgrade of the US credit rating by Fitch, resulting in the US losing its Triple-A status, will have significant impact on markets.</li>
<li>The disappointing ISM Manufacturing Index comes with massive downside for Equities in all regions.</li>
<li>While the Big Tech earnings dream get to live another day, the risks of a further and more significant slowdown in company earnings remain abundant.</li>
</ul>


Unlike many suggest, the downgrade of the US credit rating by Fitch, resulting in the US losing its Triple-A status, will have significant impact on markets.
The disappointing ISM Manufacturing Index comes with massive downside for Equities in all regions.
While the Big Tech earnings dream get to live another day, the risks of a further and more significant slowdown in company earnings remain abundant.


The Weekly Market Monitor (31) – Bye, Bye, Triple-A

Cross-Asset Liquidity Strategist, CrossBorder Capital

Michael J. Howell

Cross-Asset Liquidity Strategist

Implementing Research Using Alt Data & AI

CrossBorder Capital

CrossBorder Capital is a London-based independent investment advisory firm. Founded in 1996, it exploits a gap in the investment arena by focusing on Central bank liquidity. 

It specialises in the monitoring and analysis of global liquidity flows - an important determinant of asset prices, from currencies through to bonds, equities and real estate.

CrossBorder Capital implements its investment strategy and currently manages over US$ 350m.


<ul>
<li>Did Treasury Secretary Yellen's recent trip lead to a US-China Accord that allows the US dollar to weaken and China's PBoC to ease again?</li>
<li>Markets are acting as if this happened, but in reality this 'accord' simply reinforces existing forex and liquidity trends</li>
<li>
Emerging Market liquidity is currently high. This is inconsistent with an upcoming recession, but aligns with a rising Global Liquidity cycle. Expect more US and Chinese easing.</li>
</ul>


Did Treasury Secretary Yellen's recent trip lead to a US-China Accord that allows the US dollar to weaken and China's PBoC to ease again?
Markets are acting as if this happened, but in reality this 'accord' simply reinforces existing forex and liquidity trends

Emerging Market liquidity is currently high. This is inconsistent with an upcoming recession, but aligns with a rising Global Liquidity cycle. Expect more US and Chinese easing.


A Secret US-China Accord? Will It Boost Global Liquidity?

Macroeconomics

<ul>
<li>Comparable to the China Growth Scare of 2015-2016, the Manufacturing PMI is below 50, imports are falling, and deflation worries are rising.</li>
<li>The real estate crisis is worse than in 2015-2016, with housing prices falling again, floor space under construction declining, consumer confidence near historic lows, and LGFV financing issues increasing.</li>
<li>Unlike 2015 (and 2022), the current depreciation of the Chinese Yuan has not (yet) been accompanied by falling stock prices. </li>
</ul>


Comparable to the China Growth Scare of 2015-2016, the Manufacturing PMI is below 50, imports are falling, and deflation worries are rising.
The real estate crisis is worse than in 2015-2016, with housing prices falling again, floor space under construction declining, consumer confidence near historic lows, and LGFV financing issues increasing.
Unlike 2015 (and 2022), the current depreciation of the Chinese Yuan has not (yet) been accompanied by falling stock prices. 


China: An Accident Waiting to Happen? Comparing the Current Chinese Economy to the One in 2015

<ul>
<li>The risk premium of equity asset classes has further declined. The risk premium on US Equities is now just 3.1%, which is very unattractive.</li>
<li>The risk premium of equity asset classes has further declined. The risk premium on US Equities is now just 3.1%, which is very unattractive.</li>
<li>Our ‘Bellwether EPS indicator’ points to a year-on-year earnings-per-share decline of nearly 22%, leaving little room for earnings growth to remain positive.</li>
</ul>


The risk premium of equity asset classes has further declined. The risk premium on US Equities is now just 3.1%, which is very unattractive.
The risk premium of equity asset classes has further declined. The risk premium on US Equities is now just 3.1%, which is very unattractive.
Our ‘Bellwether EPS indicator’ points to a year-on-year earnings-per-share decline of nearly 22%, leaving little room for earnings growth to remain positive.


China

The MSCI Em (Emerging Markets) Index is a free-float weighted equity index that captures large and mid cap representation across Emerging Markets (EM) countries. The index covers approximately 85% of the free float-adjusted market capitalization in each country.

MSCI Emerging Markets Index (MXEF INDEX)

China’s Ongoing Real Estate Disaster Is Pushing Emerging Markets to the Brink

Ongoing issues in the Chinese property sector have pushed Emerging Market Equities to within 1.5% of a critical index level.

Jeroen Blokland

The Weekly Market Monitor (31) – Bye, Bye, Triple-A

The US has lost the Triple A-rating, which, unlike many suggest, will have major implications. If not in the short run, then definitely in the long...

Jeroen Blokland

A Secret US-China Accord? Will It Boost Global Liquidity?

Treasury Secretary Yellen's recent trip may have led to a secret US-China Accord that allows the US dollar to weaken and China's PBoC to ease...

Michael J. Howell

China: An Accident Waiting to Happen? Comparing the Current Chinese Economy to the One in 2015

Current economic conditions in China increasingly resemble those of 2015-2016, with some looking worse than eight years ago.

Jeroen Blokland

Markets Better Not Focus on Valuation

Valuation measures reveal pricy equities and cheaper Treasuries. A comprehensive overview of valuation across asset classes.

Jeroen Blokland