How “NO-DEAL Brexit” Would Affect the World’s Economy?

How “NO-DEAL Brexit” Would Affect the World’s Economy? What could a no-deal Brexit mean for developing countries? Main losers if there is a no-deal Brexit: European Union and Turkey. Main winners if there is a no-deal Brexit: China, USA, Japan, Thailand, South Africa, India, Brazil. Image: howmuch.net, UNCTAD

Earnings Matter, Over the Long Run

Earnings Matter, Over the Long Run Over the long run, equities move with earnings. Currently, there is a big gap between U.S. and Europe earnings. As Warren Buffett said: “for 240 years, it’s been a terrible mistake to bet against America.” You may also like “Global Earnings since 2006.” Image: Cullen Roche

Global Earnings since 2006

Global Earnings since 2006 This chart shows global earnings since 2006 (USA, Emerging Markets, Japan and Europe). As Warren Buffett said: “for 240 years, it’s been a terrible mistake to bet against America.” This chart below illustrates it well since 2006. You may also like “Earnings Matter, Over the Long Run.” Source: J.P. Morgan Asset Management

S&P 500 Cash Return Yield by Sector and Region

S&P 500 Cash Return Yield by Sector and Region Currently, the S&P 500 cash return yield (buybacks + dividends) is 5.2%, the highest since 2011. That’s much more than Europe, Japan and emerging markets. Image: Fundstrat Global Advisors, LLC

Societe Generale’s Chart of Swan Risks

Societe Generale’s Chart of Swan Risks This chart shows the downside and upside risks to the growth outlook. Biggest risks (black swan): protectionism/trade wars (25%), and European policy uncertainty (20%) Image: Societe Generale Cross Asset Research

Are Value Stocks Cheap or Expensive?

Are Value Stocks Cheap or Expensive? Value stocks usually trade at a 24% discount to the stock market.But as of 02/29/2019, they are trading at 31% discounts in the U.S., 33% discounts in Europe and 34% discounts in emerging countries. Image: GMO

Why Do Eurozone Bond Investors Accept Zero Long-Term Interest Rates?

Why Do Eurozone Bond Investors Accept Zero Long-Term Interest Rates? Because they have a deflationary view of the euro area economy. Now, investors are losing so much money just by holding German bonds in real terms (adjusted for inflation). Today, the Germany 10-Year bond yield hits 0% again. Keep in mind that raising interest rates in…

Stock Market Equity Risk Premium

https://www.isabelnet.com/wp-content/uploads/2019/03/stock-market-equity-risk-premium.mp4 This fabulous model shows if the US stock market return for the next 10 years is more or less attractive than the 10-Year Treasury Note The US stock market equity risk premium is the US stock market excess return for the next 10 years over the US 10-year Treasury Note. This is the premium…

Stock Market Valuation

https://www.isabelnet.com/wp-content/uploads/2019/03/stock-market-valuation.mp4 This powerful model looks into the US stock market and alerts if it is overvalued or undervalued The model shows the valuation percentage to the right and to the left. In the middle, it shows what the probability of each event happening is. Probability is a way to show how often an event will…