Global Investing

Rich investors betting on emerging equities

April 4, 2013

By Philip Baillie

Emerging equities may have significantly underperformed their richer peers so far this year (they are about 4 percent in the red compared with gains of more than 6 percent for their MSCI’s index of developed stocks) , but almost a third of high net-worth individuals are betting on a rebound in coming months.

Central banks and the next bubble

February 21, 2012

Central bank balance sheets are expanding at what some say is an alarming pace. Can this cause the next bubble to form and burst?

Japan fires latest FX wars salvo; other Asians to follow

October 31, 2011

Emerging central banks that sold billions of dollars over the summer in defence of their currencies might soon be forced to do the opposite. Japan’s massive currency intervention on Monday knocked the yen substantially lower not only versus the dollar but also against other Asian currencies.  The action is unlikely to sit well with other central banks struggling to boost economic growth and raises  the prospect of a fresh round of tit-for-tat currency depreciations. Already on Monday, central banks from South Korea and Singapore were suspected of wading into currency markets to buy dollars and push down their currencies which have recovered strongly from September’s selloff.  The won for instance is up 6.9 percent in October against the dollar — its biggest monthly gain since April 2009.  The Singapore dollar is up 4.5 percent, the result of a huge improvement in risk appetite.

from MacroScope:

New twist in Hungary’s Swiss debt saga. Banks beware.

September 9, 2011

A fresh twist in Hungary's Swiss franc debt saga. The ruling party, Fidesz, is proposing to offer mortgage holders the opportunity to repay their franc-denominated loans in one fell swoop at an exchange rate to be  fixed well below the market rate.  This is a deviation from the existing plan, agreed in June, which allows households to repay mortgage installments at a fixed rate of 180 forints per Swiss franc (well below the current 230 rate). Households would repay the difference, with interest, after 2015.

Sliding over troubles

March 3, 2009

Bond yields are on the rocks, prices are hitting the steepest slopes and credit derivatives are at an impasse. So what better way to spend the time than to join 200 bond traders for a skiing weekend in Switzerland?

The other side of bank secrecy

December 12, 2008

For many, the words bank secrecy and offshore centre tend to raise James Bond-like scenarios of illicit bags of cash smuggled across the border to be locked away in a coded safety box. But often the rich of this world have legitimate reasons to open a protected bank account in Switzerland or other tucked-away offshore locations.
Some, like the residents of oil-rich Gulf countries, do not even have worry about the tax man as these nations are largely tax free. “Offshore does not mean that the money is undeclared,” said Jonathan Ivinson, head of tax at international law firm Hogan and Hartson.
Despite a global crack-down on money-laundering and tax evasion, bankers say many affluent clients from places like Latin America will continue to keep their money away, safe from a potential coup.  In countries where corruption is rife, people would rather not let their local banker know how much money they earn for fear of kidnapping.
“It obviously depends a lot on how worried, how unhappy you are about the jurisdiction you live in,” said Prince Max, the second son of Liechtenstein‘s ruling monarch and the head of the
country’s largest bank LGT. “If you live in a highly volatile and unstable country it is very rational for people to address this risk.”
– Lisa Jucca

Give and take in Switzerland

December 11, 2008

Switzerland prides itself for being a reasonably generous country. Each year it gives 1.2 billion Swiss francs, or about 0.4 percent of its gross domestic product, in aid to poorer countries, a higher portion of aid than larger states such as Britain.