Stealth tax rises are eating into your income
A curious feature of the Australian tax system is “bracket creep”. Taxpayers whose income climbs by no more than prices (inflation) get no increase in their living standards. Instead, they see more and more of their income pushed into their highest tax brackets, or to even higher tax brackets. It means the government’s income from…
Central banks face a difficult choice
With Russia and Ukraine at an impasse, commodity prices are surging and the risk of stagflation increases. Given the challenging backdrop, we remain defensive, liquid and focused on managing downside risk and preserving capital. Recent news has been dominated by the conflict in Ukraine. This is a humanitarian crisis, and our hearts go out to…
Investing mistakes during a crisis
Two things surprised me last Thursday morning that should not have done. The first was that Heathrow in February is around 20 degrees colder than Cape Town. I was not correctly dressed. The second thing I learned when my phone reconnected at Terminal 5 was that Russia had invaded Ukraine. Again, I might have expected…
The oil shock by nature is an accruing one, not a one-off
Markets In the past 48 hours, the Russian ruble traded between 111 and 177 against the US dollar. The moves suggest traders struggle to price Russia’s economic collapse in an illiquid fashion. Over in Europe, things are getting pretty complicated. EU leaders are trying to build a comprehensive and sectionalized united economic response to the…
Gold – the only ‘safe haven’ asset?
Gold prices have risen amid the Ukraine crisis. However, as this shocking situation evolves, we think gold remains set to become the ‘TINA’ (there is no alternative) safe haven asset. The Russian invasion of Ukraine has had many consequences – first and foremost is its devastating humanitarian impact. While we cannot lose sight of how…
Disrupted gas supplies will hit global prices
As economic sanctions on Russia escalate, there has been an attempt to isolate vital energy exports from the mix. This may be wishful thinking. US President Joe Biden last week said sanctions against Russia, including cutting off Russian banks and individuals from the global SWIFT transaction system, were “specifically designed to allow energy payments to…
Acceleration to Asia
In the last two decades, Asia has become a powerhouse of global growth. Demographics and digitalisation have fuelled economic and business expansion, and this has played an important feature in the management of the COVID-19 crisis and the region’s resilient economy. Looking ahead to a post-pandemic world, we believe a new economic order will prevail,…
How are markets adjusting to the ongoing crisis?
It’s been a week since Russia invaded Ukraine, and markets are still trying to adjust to the geopolitical crisis and shocking tragedy in the region. Trading across asset classes was volatile all week. U.S. stocks trended higher through Thursday despite choppy trading (especially in overnight sessions), while European stocks are at their lowest levels of…
Yondr Money raising capital to fund expansion
Neobank and rising fintech company Yondr Money, is set to raise $1.5M – $2M to fund its expansion as an alternative to mainstream banks. The Melbourne-based fintech promises to reduce costs and improve customer experiences whilst most importantly helping Australians improve financial literacy. Initial backers include Mike Smith, former CEO of ANZ Bank, who sits…
What inflation means for fixed income portfolios
With Australian core inflation spiking in December, it is essential to consider the impact of inflation on asset allocation. Persistent high inflation has several implications for credit markets, which we believe need to be managed via both fixed and floating rate strategies. There are also a few options for investors looking to mitigate the impact…
