7 Day Yield Special Edition: Globalization versus the rise of populism



welcome to special edition of 70 yield on Metro shell fears of globalization have sparked a new wave of nationalism how pervasive is this trend and is it contagious 7a yields Lydia Marsh sat down with Peter bee gees global investment opportunity practice leader dr. Alexis crow to explore that and more we saw during the campaign cycle this rise of nationalism and with the new administration coming in you know how is that likely to impact global businesses obviously this has implications for the future of globalization and global commerce for the first time really in history we've seen the business community not necessarily aligned with a Republican candidate and so that's provided with a unique set of circumstances for companies to be able to navigate emerging markets so after the election we've seen emerging market currencies tumble for a number of different factors relative to the dollar so the first is looking at an expectation of a Fed rate rise in December which two futures markets point this morning to ninety percent the second factor being an expectation of fiscal stimulus with the new president one season office and the third being this rise of populism and the rise of the right in Europe which by no means has seized with brexit so all of these complications and the developed economies are pushing a stronger dollar that in turn has a deleterious impact on emerging market currencies and that has implications for global investors positive and negative so immediately after the Trump victory we saw a lot of capital outflows out of bonds and emerging markets and equities but also in the time of a dislocation such as this it's also a time to invest for long-term opportunities so one of the things we're doing with clients is looking at the long-term appreciation of assets and enterprise value of the long-term in emerging markets you touched a little bit on Commerce earlier and you know if we look at it from a global perspective again our trade agreements likely to be may be renegotiated or revisited well so one of the most important things I think we've learned this week is that we have to for the facts mm-hmm so we have to wait until the president-elect actually makes all of his cabinet appointments before we're really able to see what's going to happen with regard to foreign commerce and at these a lot of the presidential advisers or president elects advisors have come out and said to the markets that were focused on fiscal stimulus infrastructure spending tax credits as opposed to starting a trade war with China so is this a sit and wait scenario or are there steps that companies can take now both in the US abroad while we wait for the administration to get up and running I think that the next three months leading up to the inauguration will be analogous to the last four months after the referendum in the UK where there is this wait-and-see mentality which is good for consultants not necessarily for businesses so there's a wait-and-see mentality however there are certain things we can do so investing long-term when there is a dislocation and emerging market currencies is won by investing in operations the second is to be able to look at other potential regional groupings and opportunities that those might yield so any final points that you can leave our listeners with in every dislocation there's an opportunity so I look to some of the fortune 500 companies who have said to whatever president came into office this is a time for unity in to unite a divided country and I think that's of the utmost important




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