It’s hard to miss all of the doom and gloom in the financial press. Via Credit Suisse, it’s infected markets too:
…our Global Risk Appetite Index is near panic…our equity-only (relative performance across EM and DM countries) and credit-only (relative performance of US IG sector/rating/maturity buckets) versions are already there.
Trade disputes, the Italian budget, Fed tightening, and emerging market turbulence are contending to be the main driver of this risk appetite slump. However, growth concerns have featured too, as European data in particular have disappointed. Meanwhile, many investors claim that widening credit spreads and a flattening yield curve portend the cycle’s end.
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
