Nickolai Hubble

Nickolai Hubble

Nickolai Hubble is chief strategist of The Fleet Street Letter and Fortune & Freedom, which are published by Southbank Investment Research. He’s also the editor of Jim Rickards Strategic Investment in Australia and a contributing editor of The Daily Reckoning Australia.

After finishing his degrees in finance and law at Bond University in Australia in 2009, working for an investment bank didn’t seem so enticing any more. An internship with his scholarship provider Goldman Sachs during the height of the financial crisis was quite enough of that.

Instead, Nickolai went to work for independent publishers that allow their analysts to predict the financial crises that investment bankers cause.

In 2012 Nickolai exposed the sub-prime practices of Australian banks to his readers at The Money for Life Letter. His accusations that bankers and mortgage brokers routinely manipulate their customers’ loan applications were vindicated by a Royal Commission in 2018.

In 2018 Nickolai predicted Italy’s budget battles would lead to “Bloody October” and successfully warned his subscribers about the worst period in financial markets since 2008. In August he compiled his predictions into a book called How the Euro Dies.

Nickolai doesn’t just investigate financial markets and predict crises and opportunities. He’s also a flying trapeze, juggling and chin balancing performer and instructor. He’s lived in England, Ireland, Scotland, Austria, Germany, Australia, Thailand and Japan, stubbornly refusing to identify with any nationality.

Nickolai is the only person to have spun a plate on a stick while playing the bagpipes while swinging on a flying trapeze bar eight metres up in the air.

  • The countdown to lockdown

    Capital & Conflict – brought to you by Fortune & Freedom Of course they won’t call it that. But the media and the protesters will. And it’ll feel like one. The countdown to our next lockdown has already begun. That’s…

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  • Inflation can no longer be ignored by stocks or central bankers

    Capital & Conflict – brought to you by Fortune & Freedom Yesterday’s Fortune & Freedom explained how central bankers have managed to avoid acknowledging the side-effects of their misbehaviour for so long. But the trends which kept a lid on…

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  • Stocks get another tobacco smoke enema through their annual Jackson Hole

    Capital & Conflict – brought to you by Fortune & Freedom What happens when you mistake a symptom for a disease? Because that’s just what central bankers are doing right now. And their mistake is all that’s keeping stocks afloat….

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  • A confession about your future

    Capital & Conflict – brought to you by Fortune & Freedom “It’s tough to make predictions, especially about the future,” explained Yogi Berra. But it’s been a good run for Fortune & Freedom so far. The bitcoin price boomed after…

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  • Welcome to the War on Covid

    Capital & Conflict – brought to you by Fortune & Freedom It may well be that lockdowns are a good idea, that nations should theoretically open up after reaching some vaccine threshold, that track and trace will prevent outbreaks according…

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  • The battle for immigrants gives the UK a decisive advantage

    Property in Japan is considered a depreciating asset, like a car. When young people inherit property in Japan, it is seen as a burden because of the costs of upkeep or demolition. Arson by the owner to escape tax and insurance fees is a real problem.

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  • What I learned from the Hard Money Council

    The first idea is simple. For a few weeks, markets have been worrying about whether the central banks will taper, meaning they will begin to withdraw their quantitative easing (QE – the creation of money to buy government bonds and other securities) and other forms of loose monetary policy.

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  • What if vaccines don’t end the pandemic?

    Now you might think that we are finally getting somewhere when it comes to this pandemic thing. Perhaps we’re even getting towards the end of it. But I’m not so sure that the vaccines will save us and unlock the global economy.

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  • How Afghanistan defeats Europe’s empire

    On Friday, I ask Nigel Farage about whether the mess in Afghanistan would lead to a repeat of Europe’s 2015 refugee crisis. He said something which shocked me about the connection between that crisis and Brexit.

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  • And then came the recession

    I’m getting worried the global economic recovery from the pandemic is about to go very sour. And with it, asset prices. In fact, a recession may well be on the horizon. The reason is simple. Economists might be able to count the amount of economic activity, but not whether it’s worth it.

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  • The US dollar is heading for the graveyard of currencies

    In keeping with what Boaz Shoshan and John Butler spoke about, let’s kick off today’s Fortune & Freedom with a clever point made by a reader about the collapse of the global reserve currency, the US dollar…

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  • Welcome to the consumer price inflation bubble

    If you liked the tech bubble and the housing bubble, you’re going to hate the consumer price inflation bubble.

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  • The stock market is one hell of a drama queen

    My daughter, much like the stock market, is at that age when she can’t quite communicate what she wants, but all hell breaks loose if she doesn’t get it.

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  • The Bank of England goes for woke

    In fact, inflation is now so bad that the Bank of England and the House of Lords got into a public spat about the central bank policy of quantitative easing (QE – creating money to buy government bonds).

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  • Stocks, bonds, gold and property each predict a different future

    If you believe the market’s prediction is wrong and you know better, well, you can make money on the difference. But only on the difference.

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  • The Lords versus the Bailey

    Is the Bank of England addicted to QE? Or did the pot call the kettle black?

    The UK’s exports to the EU have surged well above pre-referendum and pre-Brexit averages. What does it mean for UK politics going forward if Project Fear is vanquished?

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  • Locked out of crypto, or into the banking system?

    The claim that cryptocurrencies are connected to fraud is a case of the pot calling the kettle black, says Sam: “The traditional system continues to have lost far, far more to scams and fraud than crypto ever has.” It reminds me of the stories about cash being used for illegal purposes. But more on the banking system’s culpabilities in a second…

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  • Cryptocurrency investor vs goliath

    In yesterday’s letter, reader J.B. reported on some difficulties he was having with buying more cryptocurrencies. His bank was making life difficult. Today, the tale turns epic.

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  • Readers reveal the reality of financial repression

    It’s time to dig into the mailbag today. Your demands for a virtual conference on escaping financial repression have been heard, loud and clear, by the way.

    And so, for today, let’s look into the damage done by financial repression in the form of low interest rates, what happened when one reader attempted to buy cryptocurrencies to escape financial repression, and more…

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  • A crisis for the NHS, or from the NHS?

    Find out what Nigel Farage has to say about the backlogs, the future of the NHS and the potential crisis that awaits Britain as it tries to save those the NHS was supposed to, in this video…

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  • Covid cases surge after Freedom Day

    I’ve always known different nations’ news channels report the same news entirely differently. I follow the news from the UK, Germany, Australia and the United States each day. And they’ve offered completely different facts and “science” throughout the pandemic.

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  • Not just another housing bubble

    House prices around the world are booming in the midst of a pandemic, not to mention despite Brexit. But why? And will it last?

    As you’re about to discover, I believe this goes beyond the usual housing bubble. But first, the data…

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  • Misunderestimating risk

    But consider this. Your definition of the word “risk” and the definition used by the financial industry serving you is completely different. And the gap is the source of rather a lot of anguish, if you ask me.

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  • When the gold price booms

    Your regular editor Boaz Shoshan is otherwise incapacitated today. So it falls to your former editor Nickolai Hubble to offer up some words about our favourite subject, cryptocurrencies gold. The gold price is posed to surge in coming years as…

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  • The contingency plan of Argentina

    Ever wonder who founded our newsletter publishing company? Not Southbank Investment Research, but our friends in the US who preceded us. Well, it’s time to meet him. Bill Bonner and his wife, Elizabeth, have spent much of 2020 hunkered down…

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  • Lockdown Down Under

    “Where the bloody hell are you?” was the slogan in an Australian tourism campaign in 2006. It got banned in the UK… Today, the Aussie tourism industry doesn’t have to wonder any more. The country simply shut down one of…

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  • Badly disguised signs of a bubble

    Kodak has joined the growing list of companies with spiking stock prices and is perhaps the most surprising of all. What these companies share is a good story, not a great business. In this episode, Boaz Shoshan, Kit Winder and…

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  • Time to dig up John Law?

    I was thinking about how it’s a shame we don’t have a new North America to discover. We could send the Royal Navy off to colonise it and then sell it off like John Law did, thereby solving the problem of the national debt. And then it hit me. The world does have such a place…

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  • Your stock banned for Chinese accounting?

    With Boaz Shoshan otherwise occupied, Southbank’s tech expert Sam Volkering and macro-strategist Nickolai Hubble talked about the news this week. UK GDP plunged by a quarter, before bouncing back less than expected. But what does that really mean? Will gold’s…

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  • My wet nostril dream about Russell Napier

    What made Russell Napier so interesting is that he stuck with his prediction of prolonged deflation in the face of QE1, QE2, QE3 and so on and so forth. While many financial analysts were worrying about hyperinflation, let alone inflation, Napier said we’d see a lack of inflation. And he was right.

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  • Inflation pays off government and mortgage debt

    Presumably you are older now than you were in the 70s… Well, in today’s podcast, we explore what a return to inflation would mean – whether its effects on your life would differ to the last bout Britain went through….

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  • If you could have your time again

    Your regular editor Boaz Shoshan remains on holiday. And Kit Winder is busy researching the stocks you’ll want to buy in coming months. So it falls to me, Nick Hubble, to carefully avoid talking about Brexit today. Was yesterday the…

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  • They only lasted two months

    Boaz Shoshan is putting the finishing touches on this month’s Zero Hour Alert this morning. So I’m back in the hot seat at Capital & Conflict. But you know what, this morning I really don’t need to give you much…

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  • The most serious warning of my career 

    It’s finally ready… I spent most of last week getting a high-level security pass – submitting my passport to the authorities, getting an endorsement from senior political figures and even passing through airport style security. It was the culmination of…

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  • Italian banks go boom

    Let’s do the maths. The total value of non-performing loans in the European Union is valued around €900 billion. Banks have made provisions, meaning set aside money, for about half of that. Leaving about €450 billion in questionable loans. The…

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  • European integration doesn’t lead to convergence. It leads to financial crises.

    Nick Hubble here. I wasn’t quite finished with you on Monday, so Boaz Shoshan let me elbow back in with more today. Two days ago I showed you how the high priests of Europe’s monetary experiment are abandoning ship. The…

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  • Europe’s monetary priests begin to renounce their religion

    A “suicide pact”. That’s what the famous Australian economist Steve Keen called the euro in a recent interview. And his views are catching on. But not where you’d expect. Back in 2011, Jacques Delors told the Telegraph, “Everyone must examine…

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  • Range bound doesn’t have to mean profitless

    It’s the last day of 2018. I hope it’s been a great year for you personally. Because it wasn’t for financial markets. But there’s no point reliving what made markets tank in 2018. It’s probably still fresh in your mind….

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  • A handover doesn’t mean it’s over

    Today is my last day as your editor of Capital & Conflict. I’ve been here since February 2017. Let me know what you think of my scribbles by emailing [email protected]. But don’t worry, I’m not leaving you completely. Just moving…

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  • Brexit to wipe 99% off UK GDP

    The forecasts are out and the headlines are in. Brexit will be an economic catastrophe – worse than the recession we didn’t have after the referendum. It’s encouraging to see the newspapers talking about the economic cost of government policy….

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  • Discover How the Euro Dies, in film

    Have you ever wondered what our office looks like? Today’s Capital & Conflict comes to you from our newly complete recording studio. It was recorded on the day stockmarkets surged on the news Italy would back down in its budget…

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  • Brexit is but a symptom of what’s to come

    My new book officially launches tomorrow. Not that you can’t claim a free copy here now, and start reading today. That’s probably a good idea given how fast my predictions about Italy’s budget battle came true. I’ve revealed a chunk…

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  • Profit from Europe’s last gasp

    I have a confession. The market crash in October wasn’t just about Italy’s budget debacle. It was also about the underlying force which is getting Italy into trouble right now. Here’s how I explain it in Chapter 5 of my…

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  • What really happened at Thanksgiving

    It’s Thanksgiving in America. But before you can get to the festivities below, I wanted to make you aware of a shocking prediction. What if the market melts up before it melts down? What if stocks go for one last…

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  • What is the market discounting?

    Bloomberg pulled no punches this morning: “One of the toughest years for financial markets in half a century got appreciably worse Tuesday, with simmering weakness across assets boiling over to leave investors with virtually nowhere to hide.” The strange thing…

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  • Brexit’s chaos is always just around the corner

    A medical emergency left my keyboard out of reach yesterday. I was unable to write to you on one of the most interesting days in British politics for many months. After six attempts to take a blood sample by nurses…

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  • Time to get a golden safety net

    Let’s start the day with a correction. And not just the stockmarket kind. In Monday’s Capital & Conflict I told you Italy’s Target2 balances had hit a record last month. But they only remained near record levels instead. Thanks to…

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  • The Italeave bill hits a new record

    They’ve done it again. Italy’s Target2 balances hit -€489.5bn in October. That’s a new record low. Of any country, ever. Including during the European sovereign debt crisis. But very few of us know what it means. In fact, nobody knows…

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  • It’s going according to plan. But whose?

    Welcome back to the semblance of stability. After a terrible October, markets have stabilised. Even the Aussie dollar is doing well. Despite a consensus forecast among investment banks of a 20% decline in Sydney and Melbourne house prices. No worries,…

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  • The stalemate means it’s showtime in the US

    If you thought the last two years of American politics were entertaining, the next two will be spectacular. The Democrats have taken the lower house of US Congress. But Republicans gained seats in the Senate. Which ruined the Democrats’ narrative…

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  • On the cusp of… something?

    Do your remember Donald Trump’s upset win over Hillary Clinton? Of course you do. But do you remember the financial market fallout? Business Insider laid it out nicely at the time: US stock futures are plunging as well. As of…

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  • The vaguely bipolar Bank of England

    I read a history of the Bank of England (BoE) last year. It wasn’t very exciting. Even when armed guards took up positions to protect the bank from riots and during the war, not much happened. But one thing did…

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  • The tally for Bloody October

    The world’s stockmarkets lost eight trillion US dollars in value in October according to Bloomberg. By that measure, it’s the worst month since 2008. Change in value of global stocks by month Source: Bloomberg October wiped out almost all of…

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  • How Italexit could sabotage Brexit

    Jokes about there not being an EU to exit from next year are making the rounds in the papers. My book about exactly how this will happen hit the printworks last night. You can get a copy here. But today…

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  • How Brexit boosted the budget

    For all the talk of ending austerity, you might think there was any in the first place. But I can’t see any budget surpluses on any charts. Government debt to GDP flatlined for three years around 88%, it didn’t really…

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  • The end of the euro and the beginning of your crash profits

    My time off is over and I’ve finally made it into the UK, for good. Thank god you’re still here too. Because Bloody October was only just the beginning. As I warned about in August, October would be the beginning…

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  • The next crisis triggers go off

    Yesterday, Nick O’Connor took you through my predictions about Italy that have come true. I called them “crisis triggers”. And so far, they’ve proven accurate. Two more clicked into place overnight. Which means the potential for a market crash is…

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  • Zombies, bombs and vigilantes

    The financial news looks like my Netflix account after watching the wrong movie. The recommended viewing section has been invaded by zombies, bombs and vigilantes. The Bank of International Settlements is warning about “The rise of zombie firms”, which are…

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  • How to delude yourself about Trump

    Feedback loops are very important for survival. But what happens when they’re misleading? Or deliberately misinterpreted? Suddenly, the gullible emotion of self-preservation becomes downright dangerous to your health. Quicksand is the best example. It looks like sand, feels like mud,…

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  • Foreign aid for the EU

    Boris Johnson is fighting for a harder Brexit. And he wants to use the UK foreign aid budget to save the elephants… Daniel Hannan says the EU is trying to call our bluff, but we’re not bluffing. We’re “bloody minded”….

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  • Money for nothing and childcare for free

    Before we get to the Labour Party’s attempt to ruin Britain, overnight news confirmed yesterday’s Capital & Conflict. But in an interesting way. Finance Minister Giovanni Tria didn’t just bow to Lega and Five Star demands. He bowed out of…

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  • Italy to abolish poverty. Or nationalise it.

    It’s Giovanni Tria’s 70th birthday tomorrow. His political career might not last that long though. The Italian government budget proposal is due by midnight tonight. Sort of. The finance minister must submit finance and growth targets. As the Bank of…

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  • A eurosceptic the Europeans can understand

    On Monday we looked at the future of the UK and EU. Yesterday, my thoughts turned into front page news. Prime Minister Theresa May threatened the EU with its worst fear. Turning the UK into a low-tax and business-friendly environment…

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  • Harmony is an emergent order

    The more power they get, the less popular they’ll be. That’s the inherent tension underlying the EU. But why is it true? When you can only choose one policy for all of Europe, then that policy will fit badly somewhere….

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  • Harmony or competition in the EU

    In their desperate scramble to find something to negotiate about, the EU and UK governments are turning to ever more ridiculous topics. The latest artificial disagreement is about deadlines. First Prime Minister Theresa May refused to extend the March Brexit…

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  • Big government vs big business

    You might notice you’re not mentioned in the headline. Which is the point of today’s Capital & Conflict. Policymakers and business decision-makers care about your vote and your money, not your interests. And, for some reason, most people are more…

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  • Lagarde for Pope

    It’s all so familiar. If I was you, I’d be thoroughly furious. Maggie seems to be absolutely fuming too. Let’s play a game so I can show you what I mean. Round 1. You have to guess which of the…

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  • Tria’s tangle could unravel markets, again

    Back in May, the reality of Italy’s election struck home in bond markets. The two-year Italian government bond suddenly plunged. And Europe’s banks followed soon after. Each announcement about who would feature in the Italian cabinet either sent markets reeling,…

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  • The rule of central bankers turns rotten

    If the government set the price of coffee or coal, you’d know what to expect. A mess. There’d be shortages and surpluses, quality problems, questionable business practices in the industry, and suspicious links between politicians and big business. But even…

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  • Australia’s banking system is about to blow

    We’re edging ever closer to the financial crisis I’ve been investigating since 2012. I moved to four different cities in Australia to conduct my research, interviewing mortgage brokers and former bankers over four years. Over the last few months, a…

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  • You’re a bunch of sexist, racist, …

    What do the US Open umpire Carlos Ramos, Australian Greens Senator Adam Bandt, and Brexit voters have in common? They might have plenty in common, as far as I know. But I’m going to write about the odd abuse they’re…

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  • Dominic Raab finally figures it out

    There is hope for Brexit yet. And I’m not talking about Tony Blair’s comment to delay it. Although that is still my preferred outcome. Continuing Brexit negotiations after the May 2019 European elections would make things very interesting. French President…

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  • Revenge of the ratings agencies

    Do you remember when ratings agencies ruled financial markets? A 2010 BBC opinion piece started with, “Is there any more powerful and feared institution in Europe (or the world) than Standard & Poors?” Yikes. Today I explain why I think…

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  • Nationalism or imperialism? Your choice

    Nationalism or imperialism? Take your pick. These days, empires are called unions, but they’re much the same. The idea of ruling over areas greater than nation states remains. Sure, under an empire you might still have the semblance of nation…

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  • The third bubble is the worst

    You’ve lived through the tech bubble. And the housing bubble. So what’s next? Put it like this and the answer is obvious. There’s only one major asset class left. And its prices are near historic highs. The next bubble is…

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  • Buying the same Korean horse twice

    Last year, the world looked set for a return to war in Korea. For the first half of this year, the narrative suddenly changed. But now the peace process is looking more like a short-lived peace performance instead. Today we…

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  • Delivering Greece’s vengeance for them

    The EU’s disintegration continues this week. The headlines don’t seem to change much. Unless you pay careful attention to where they’re leading. If you float above Europe and see Brexit as just another domino pushing at the EU’s foundations, you’ll…

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  • Lessons from the failure of Europe’s many monetary unions

    Earlier this month I took you through the graveyard of Europe’s many monetary unions. We only had time for the old ones though. The eurozone system failed many times before it even began properly. The currency snake and the European…

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  • Project Fear’s Friday funnies

    If you haven’t been reading Capital & Conflict for long, add some sugar to your coffee before you read it today. Or something stronger. The newspapers are building their own Project Fear over a no-deal Brexit. You might call it…

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  • Waiting for the blow-off top

    The American stockmarket chalked up the longest rally in history yesterday. The former record bull market, from 1990 to 2000, delivered 417% in returns compared to today’s 323%. But we’re not finished yet. Market peaks tend to feature blow-off tops….

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  • Emerging market Domino Day

    Do you remember Domino Day? That painfully iconic European event where students from across Europe tried to set records for how many dominos they could set up and knock over? Well, it’s back. Only this time, it’s emerging markets that…

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  • The Germans vs the Horrorclown, October 2018

    “The Italian Horrorclown”. That’s what Germany’s mainstream Der Spiegel newspaper called Italy’s Deputy Prime Minister Matteo Salvini late last week. The picture to go along with the story wasn’t flattering either. Meanwhile, Der Spiegel also found a Greek economist willing…

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  • Can you afford the next crisis?

    Recessions happen. Financial crises happen. Markets crash. Currencies collapse. The odd thing, given how often it happens, is that people still don’t expect it. Are you expecting some sort of crash in coming years? A recession perhaps? This week’s The…

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  • The EU just gave it away

    Since the Brexit negotiations began, I couldn’t work out why they were so acrimonious. Free trade is mutually beneficial. Restricting it is mutually harmful. What is there left to argue about? The answer comes from British intelligence. At least that’s…

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  • It’s the timing, not Turkey, that’s scary

    Turkey’s crisis is nothing to worry about. Because if it wasn’t Turkey, it’d be someone else. What should worry you is the timing of the Turkish crisis. The world has barely embarked on quantitative tightening or interest rate increases. And…

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  • The problems with property

    My attempt to move to London continues today. We’re currently thwarted by a disappearing visa agent and a steady stream of stabbings in the news. But the marriage certificate is making its way through the Japanese bureaucracy. My surname has…

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  • The only debt they will try to repay

    Sovereign debt, corporate debt, margin lending, household debt, mortgage debt, consumer finance debt, student loan debt, and so on and so forth. Do you ever need to repay any of it? There are interest-only mortgages. Equity release can fund your…

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  • The immigration dupe fails, miserably

    Yesterday we avoided the Boris Burka furore to talk about the mechanics of the Soviet Union’s internal trade settlement mechanism. Which is important because it explains how the eurozone will fail economically in the same way. Monetary unions may destroy…

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  • The sentence that dooms the euro

    Acting Man’s blogger Pater Tenebrarum summarised the eurozone’s Target2 system with words that doom the euro: “TARGET-2 is a settlement system without a settlement mechanism.” Understand this sentence is the key that unlocks the death of the euro. And the…

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  • The Bank turns bullish on Brexit

    The Bank of England (BoE) raised interest rates by 0.25% last week. It was an unanimous decision by all nine members of the committee. The Telegraph called it the second rate hike in a decade, but the first real one….

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  • The power hodgepodge

    Who runs the EU? It’s a simple question. But the answer is far from obvious. I’d bet a survey would throw up a thousand different answers. Only a few months ago, Emmanuel Macron and Angela Merkel were going to reshape…

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  • Europe, a graveyard of monetary unions

    Those who don’t learn from history are doomed to start a currency union in Europe. That’s the key message from today’s Capital & Conflict. It’s not a particularly stark revelation. You’ve been watching the eurozone fail since before it existed….

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  • The Collapse Competition – EU vs UK

    Brexit is heating up, fast. The military is involved in preparations for a hard Brexit. The Troubles are set for a comeback in Ireland. Export and import reliant businesses are cutting back investment. Border security and infrastructure is being readied….

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  • A Fungibles Trade War

    Plenty has happened since we examined the bizarre trade war developments yesterday. Donald Trump’s meeting with the EU’s Jean-Claude Junker can be summarised with this Bloomberg quote: Trump said he hoped for a “very positive” outcome from meeting with Juncker…

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  • Trade war duplicity

    Before we begin, there’s something urgent I need to alert you to. It’s regarding the incident that took place at our London Bridge office last week, and how it’s allowed us to offer a best ever deal on our most…

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  • How to make Germans buy you French food

    Today, I will show you a crafty scheme to make German taxpayers pay for your French cheese and wine. It’s called a hard Brexit. Which is now looking more likely. Another week, another Brexit deal falls by the wayside. You…

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  • Hear no evil

    Yesterday, we explored the issue of immigration – the elephant in the room that is Europe. What bothers me about immigration is not really the first or second order effects. Because I’m naĂŻve. I grew up going to international schools….

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  • If migration remains taboo

    What if the most decisive issue of our time is also the most divisive? The one you’re not allowed to talk about. The one that’ll get you into trouble, just for mentioning it. Plenty of organisations manage to avoid uncomfortable…

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  • The worst argument against gold

    The political world is delivering a steady stream of chaos this week. And it’s only Tuesday. Keep in mind, financial markets obsess over politics. And for good reason of late. With central banks poised to prevent any sort of rout,…

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  • Escape the financialisation of retirement

    Why do we invest our retirement savings in financial markets? The answer better be damned good given it’s practically government policy. Ironically enough, the government policy of auto-enrolment tells you plenty about the nature of the system. It relies on…

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  • When is the market wrong?

    The surprising thing about financial crises is that they come as a surprise. The stockmarket and the bond market are supposed to be forecasting mechanisms. They “discount” the future, meaning they figure out how much something is worth by estimating…

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  • Legislating Murphy’s Law into Brexit

    Brexit is roiling markets. The pound dumped, jumped and dumped again as ministers resigned. Is a soft Brexit more likely than ever? Is a hard Brexit on the cards now? Which of the two is good for Britain and bad…

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  • Don’t give money to moochers

    My research into Britain’s future continues here in Japan. And I’ve reached a very simple conclusion to guide your financial decision-making going forward: don’t give money to moochers. That’s the consensus view from those who know what it’s like to…

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  • What would a political crisis do now?

    Angela Merkel and Emmanuel Macron are in trouble. The politics of tolerance and charisma are not working. What if Europe’s leaders fall? One after the other? Could financial markets stomach political uncertainty now? I’m not just talking about political storms…

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  • Why you should expect the trade war to escalate

    Tomorrow, it begins for real. The trade war gets hot. Donald Trump’s tariffs come into effect. $34 billion in Chinese goods will be subject to 25% tariffs. But if you ask the man himself, the trade war began many years…

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  • Debt solves everything, hopefully

    It doesn’t matter who you are, debt will solve your problem. If you’re a company CEO whose job and pay packet are all about raising the share price, the answer to your challenge is simple – debt. You just need…

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  • The eurozone is worse than Munchkinland

    Clearly the European Central Bank president Mario Draghi hasn’t read The Wonderful Wizard of Oz. Because he’s behaving like the Wizard himself. We know it’s just you hiding behind the curtain, Mario… And it’s only a matter of time before…

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  • Meet the dollar debt slaves

    You might think the US trade war is about the US. But it isn’t. It’s about the US’ ability to affect other nations. The real question is how much clout the global superpower has. Is it enough to get its…

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  • The Bank of Japan owns my life

    With Australia and Germany out, your editor’s interest in the World Cup has halved. But Japan and England play tonight. Yesterday, in anticipation of the game, I bought beer made by the Bank of Japan (BoJ). At a shopping centre…

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  • Immigration regurgitation

    It’s pretty rare to hear anything profound from a politician these days. But this week, it’s come thick and fast from across Europe. Our first candidate tried to be polite and civil about things. But failed miserably. Because the numbers…

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  • A monetary coup under the cover of Brexit

    What sort of policies will be passed under the cover of Brexit? My worry is that you can twist the referendum any way you like and claim a mandate for whatever you want. As long as you include the word…

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  • The new pressure valves are whistling

    If you’re utterly mystified by the last few years of economic and political events, we’ve devised a narrative for you. Central banks have crushed volatility. Financial markets are now stable. The problem is, financial markets are just a reflection of…

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  • The pension disappearing trick

    You wouldn’t expect a government actuary report to be terrifying. But let me tell you, the “Government Actuary’s Quinquennial Review of the National Insurance Fund as at April 2015” report definitely is. First, notice its rather optimistic assumptions. It modelled…

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  • Mistaking the thermostat for the thermometer

    With so much political action in Italy, the White House, Germany and Brexit Britain, we’ve been neglecting the global financial markets. Against the dollar, the pound is down almost 8% from its peak in January after a 17% rally that…

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  • Global bonds wobble to inversion

    Earthquakes are especially disconcerting when you’re sitting on the toilet. Perhaps that’s why they make them so comfortable here in Japan. Before I’d emerged from the bathroom, the various family members across the country had already checked in with each…

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  • The World Cup’s most important fields

    The World Cup has begun. You’ll find yourself utterly mystified by my coverage over the next few weeks. As a German by birth, Brit by citizenship, Australian by choice and Japanese by something called a “family register”, I have decent…

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  • How not to pitch Britain

    I’m having a tough time trying to persuade the Japanese future in-laws to let their first-born move to London. Relations between Japan and our capital city have been strained since former mayor Boris Johnson flattened a ten-year-old Japanese child trying…

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  • How to make Trump pay

    Can you imagine if Barack Obama had delivered the Korean peace talks that Donald Trump just did? The world would be swamped with a flood of praise from around the globe. But Trump only gets derision. For his methods and…

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  • Italian capital flight confirmed for May

    In the end, the Italians gave it away themselves. Not the World Cup, their capital flight. Deposits are fleeing the country. The European Central Bank (ECB) might not be releasing its Target2 balances for another few weeks. But the Bank…

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  • Your retirement is a political promise

    It’s always fun to see the government fail the very people who stir it into action. Prohibitionists who fall victim to organised crime gangs. Warmongers who get called up in the draft. Rent control advocates who live in dilapidated buildings….

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  • No deal is better than any deal

    In 2016 I joined the Free Market Road Show. We travelled around Europe giving speeches about things like the EU and the sharing economy. The troupe mostly visited eastern European countries, where the battle of ideologies is still distinct. In…

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  • ECB not behind the Italian crash

    Which currency would you hold over the next year? You only get three choices: the euro, the Italian lira or bitcoin. Which do you choose? You’ll find out my pick below. Trying to stay more than one step ahead of…

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  • Italy’s backdoor bailout delayed

    Italy’s financial crisis didn’t return with a bang on Friday as I expected. And Italy’s Target2 liabilities didn’t spike in April either. They more or less held steady: Italy Target2 balances Source: European Central Bank (ECB) Italian bonds staged a…

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  • The EU’s dumbest law yet

    This Brexit thing is a real debacle so far according to the latest figures from the Office for National Statistics. Especially compared to the continent. UK incomes are rising faster than inflation. The highest proportion of Britons are employed since…

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  • All roads lead from Rome

    “Italy could be out of the EU before Britain,” writes Jeremy Warner at the Telegraph. I wish I came up with that line. Instead, I’m rather worried the Italian and EU crisis will do the precise opposite. Brexit will be…

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  • The Union strikes back

    The dark side’s henchman has revealed himself. We still don’t know who is pulling the strings behind the scenes. But Italy’s President Sergio Mattarella is doing her dirty work with an emphatic “Nein!” of his own. This weekend, President Mattarella…

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  • Observations from your future

    It’s a bank holiday today. If you’re on the way to work, we hope your train was cancelled in time. They don’t cancel trains here in Japan. When I say that the trains run on time, you have no idea…

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  • Guide to Understanding the Price of Gold

    Gold is the world’s most polarising asset. People either love it or hate it. You’ll be denigrated a gold bug for owning it, or an ignorant moron for not. There are good reasons for this division. Gold’s position is an…

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  • America’s lost decade is over

    This Capital & Conflict will attempt to persuade you that America is a poor, bankrupt nation without hope or promise. And you should do something about it. I’m still trying to persuade myself, because what I’ve found is rather shocking to…

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  • The EU is surrounded and infiltrated

    Brexit to the west. Italian populism, fiscal mayhem and euroscepticism to the south. Right-wing populism to the east and north. A pro-Russia agenda to the south and east. An immigration debacle throughout. And minority parties left, right and centre. It’s…

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  • Gleich funkt es

    “Gleich funkt es,” my German family always said as their final warning. It roughly translates to, “Any moment now, sparks are gonna fly.” Youngins on the receiving end of that comment got their act together real quick. Have you noticed…

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  • The only thing driving the stockmarket

    It turns out that investing is really very simple… in a way. Howard Wang of Convoy Investments explains that investment prices are driven by the amount of money and the amount of assets. Asset price = quantity of money/supply of…

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  • 10 Reasons to Leave the EU

    This article is an update on a pre-referendum article from Dominic Frisby. To read the original, click here. The EU referendum has come and gone, and Article 50 has been triggered. But Brexit is far from over. Some still don’t…

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  • Abandon your pension mountaineering

    My mum lives in front of the Wilder Kaiser. It’s a pretty mountain in Austria. The top half is a shiny face of bare rock which glows in the afternoon sun. You can climb up and over through the Ellmau…

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  • Trade war casualties pile up fast

    The EU’s pride is the latest casualty of Donald Trump’s trade war. But it’s not the only recent victim. The push for “fair trade” is causing all sorts of problems in every corner of the world. The worst seem unrelated…

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  • What do you actually own?

    Do you really own something if it’s controlled by the government? Property rights are a precondition for prosperity. The idea is that you own yourself, your property and the fruits of your labour. This basic concept is fairly new in…

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  • Return of the lira

    The lira is coming back. After two months of silence from Italy’s coalition negotiations, it’s all happening too fast. Remember, politics is Italy’s only way out of the euro. That currency and its monetary policy has kept one of the…

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  • The emerging market debt debacle begins

    Politicians and central bankers love to talk down their currency. It’s an age-old policy – part of mercantilism. A cheaper currency makes your exports more competitive internationally. And your imports more expensive, encouraging the consumption of local goods. Both favour…

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  • I warned you about North Korea

    Were you surprised to see North Korea’s Kim Jong-un and South Korea’s Moon Jae-in shake hands over the Korean border? Then you didn’t read Capital & Conflict on 23 November 2017. In fact, I’ve been predicting the reunification of Korea…

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  • Why we’re the world’s most fragile economy

    A spat about bank capital hit the news late last week. Not only is the topic immensely boring, but it’s also completely misguided. That should make you stop reading, unless you’re aware of the implications. If banking were to blow…

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  • Which snowflake causes the avalanche?

    If you think you’ll get a chance to relax this public holiday, you’re wrong. It’s all happening. Did you hear about the Swedish crisis? Or the one in Argentina? Perhaps that the Canadian and Australian housing bubble burst? Financial crises…

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  • Let’s play a game

    It’s called “good news or bad news”. I’m going to reveal news to you. And you have to guess whether it’s good or bad. The point being that you’re guessing. I don’t know the answer either. So don’t try too…

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  • The oldest threat will strike in 2018

    At the last minute, Donald Trump rescued his allies from his own trade war. He extended the exemption from steel and aluminium tariffs for another 30 days. But it wasn’t enough to prevent US steel stocks from sliding about 5%….

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  • There will be a little pain in the stockmarket

    Today is the day. By the time you read this, the temporary exemption to Donald Trump’s tariffs will expire. Much of the world will be subject to steel and aluminium tariffs when exporting to the US. Ironically enough, it’s also…

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  • Opt out of the blunder from Down Under

    Capital & Conflict offers you a simple piece of advice: opt out of the blunder from Down Under. As the news furore over the immigration debacle reaches fever pitch in the UK, let’s take a look at the nation which…

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  • After synchronised growth comes…

    The Trump bonanza continues across the world. Profits are up on Wall Street. Earnings season is wildly exceeding expectations for companies like Amazon. Founder Jeff Bezos saw his wealth surge $12 billion in a day. Facebook shares were up 10%…

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  • The pension panic is coming

    If you know something is going to happen in the future, when do you react to it? More importantly for the purpose of making money in financial markets, when is everyone else going to react? Because that’s when prices move….

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  • Taper tantrum take 3

    For months it’s been all about 3%. Investment analysts, traders, managers and commentators all agreed: if the ten-year US Treasury bond hits 3%, something is going to snap. Well, according to Bloomberg radio, yesterday was the big day. For the…

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  • The return to a natural state

    Today we imagine a return to a normal world. Or at least try to. Because it wouldn’t last long. Goldman Sachs CEO Lloyd Blankfein gave an interview on CNBC after his company announced its earnings for the first quarter of…

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  • The Second Coming of Sub-prime

    Do you remember when sub-prime mortgages were a small problem in an obscure part of the US mortgage market? Next thing, all hell broke loose. Well today we investigate a similar scenario. At first, it appears to be a small…

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  • The Russian trolls at the IRA

    A bad case of Russian hysteria is breaking out across the Western world again. It’s all too familiar for anyone with an interest in history. But there are some modern twists. Imagine this headline at the height of McCarthyism: “Facebook…

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  • They all roll over, but who falls out?

    Blowing up some portion of Syria’s chemical weapons infrastructure changes everything. Or nothing, depending on who you ask. Don’t ask me. All I know is that we’re walking into whatever was planned for us. If Bashar al-Assad actually launched a…

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  • Ignoring the implicit reckoning

    Given World War III might’ve started by the time you read this, I’ve got to be careful what I say. Especially with a UK partner visa application in the works. And so, let’s take a look at the premise of…

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  • The investment power of politically incorrect

    That escalated quickly. 2017 was marked with extraordinary low volatility for the US stockmarket. But so far, 2018 is shaping up to be the opposite. Instead of record amounts of days without a move greater than 1% in either direction,…

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  • The prospects of the US dollar

    Let’s delve deep into the future of the US dollar. That’s another way of saying we’re talking about everything at once. Because the US dollar is the world’s reserve currency, the currency of the biggest economy, the currency of international trade…

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  • Trade war alliances emerge

    It’s bad news all round. Not that anyone can agree on what’s good or bad news these days. And even if we could, there’s no agreement on whether good or bad news makes the market go up or down. Perhaps,…

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  • The implausibility of a crash

    Everyone agrees. The biggest risk to the markets is obvious. Central bankers are swapping quantitative easing (QE) for quantitative tightening (QT). And QT could make the world blow up in all sorts of ways. Citibank credit strategist Matt King told…

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  • Total control of the stockmarket

    Donald Trump has replaced central bankers when it comes to financial market news. Instead of trying to second guess what the money printers will do next, we await Trump’s tweetstorms. And there’s been plenty of action lately. But first, consider…

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  • The energy to dump the dollar

    We hope you had a happy Easter. The US financial markets didn’t. They were open yesterday. And it wasn’t a pretty sight. The worst opening day for the second quarter since the Great Depression led the S&P 500 below its…

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  • How to gamble on monetary madness

    The FTSE 100 is back where it was 18 years ago. Less than half the companies from back then are still in the index today. The Goldman Sachs Commodity Index is back where it started too. The oil price touched…

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  • DeFAANGed and disappearing

    American markets were down again overnight. But only marginally so. The few stocks that led the market up are now taking it back down again. A series of scandals are behind their drops. But how can a select few companies…

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  • No returns since the Millennium

    Stocks went back to their falling ways once more overnight. It seems the occasional respite is just a so-called “dead cat bounce”. The problem with a bear market now is that it begins with the FTSE index at the level…

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  • Trump schools May in trade agreements

    We should’ve hired Donald Trump to negotiate Brexit. His advice would’ve been clear. Trigger Article 50 and tell Europe we’re leaving. And then threaten it with a whole new set of trade barriers under World Trade Organisation (WTO) rules. Its…

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  • The Dear Leader and the stockmarket

    Getting into a sports stadium is always easier than getting out. Unless you leave early. The stockmarket is much the same. Up the escalator and down the elevator is the mantra describing the nature of the stockmarket’s booms and busts….

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  • The synchronisation of warning signals

    Australia didn’t even have a recession in 2008 or 2009. China’s enormous stimulus programme and a wave of immigration saw to that. It was a demonstration of the power of countercyclicality. As long as some parts of the world are…

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  • Mistreatment after a misdiagnosis

    If you’ve ever found yourself wondering why the financial industry doesn’t learn from its mistakes, today’s Capital & Conflict is for you. Financial crises are bizarrely common given how painful they can be. Bankers seem to learn slower than toddlers…

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  • Top Crypto Friendly (and Hostile) Countries

    Blockchain is the technology that makes bitcoin function. But bitcoin and other cryptocurrencies are only one application for blockchain technology. In fact, they might not be the most important one. Right now, the Australian Securities Exchange is preparing to convert…

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  • Why Britain will succeed

    Britain has agreed on a transition deal with the EU. But the EU’s negotiator reminded us that “nothing is agreed until everything is agreed”. So have we agreed on a transition deal or not? The agreement on the transition deal…

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  • Crunch time comes for cryptocurrencies

    Cryptocurrencies are marketed as an anti-government and anti-establishment alternative. But can they survive a government and establishment onslaught? Because they’re getting one. Facebook, Google and potentially Twitter will ban cryptocurrency advertising on their platforms. That includes advertising of related products….

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  • What would a recession do now?

    It’s always difficult to predict the state of the economy. But at the moment, I don’t even know what state it’s currently in. Unemployment around the world is impressively low. Monetary policy is pushing extraordinary amounts of stimulus. Growth and…

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  • A change of heart on Brexit

    I’ve argued for years that Britain should draw out the Brexit process as long as possible. Every week, the EU weakens. Every week, warnings about Brexit fade. But this week has me wondering if I was wrong. There seems to…

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  • Yielding nonsense spells trouble

    Reading a publication called The Interest Rate Observer might sound awfully boring. But right now, it’s interesting. And that’s not a good thing. Take for example this simple factoid. Telecom Italia’s bond, which expires in 2022 and carries low credit…

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  • The problem with a property price slowdown

    The UK’s property boom is sputtering and stuttering. You should be very worried about what happens next. House prices fell nationally in the last three months reported Halifax. The Royal Institution of Chartered Surveyors (RICS) house price index hit zero…

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  • Proof in your wallet why cryptocurrencies will succeed

    Ever found yourself with a Scottish banknote south of the border? Or a Northern Irish one on the wrong side of the water? Britain still has ten note-issuing banks. These are banks who issue their own pound banknotes. They look…

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  • The trade war tantrum exposed

    In 2016, the Obama administration imposed duties on Chinese steel of more than 500%. Yesterday the EU extended its anti-dumping duties on Chinese steel of between 48.3% and 71.9% depending on the company. Of the EU’s 53 steel anti-trade measures,…

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  • Escaping the currency snake

    I had no idea how obviously bad the euro is. If you take a look at history, you realise the path to the common currency is littered with consistent failures. And after each warning, the Europeans pushed ahead with their…

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  • Time to buy a house in Ireland

    My resignation from Capital & Conflict is pending. It hinges on the Brexit negotiations. And the suitability of property for sale in Ireland and Northern Ireland. Perhaps you can help. I’m looking for a pair of properties – one either…

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  • Your stock portfolio in ten years will be…

    It’s going to be a miserable ten years for US stocks. That’s what Michael Lebowitz CFA claims on realinvestmentadvice.com. And he’s got plenty of data and analysis to back him up. Of course, the world’s stockmarkets take their lead from…

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  • Still only one player in the game

    Trainspotting provides today’s economic analysis. The movie is about a drug addict’s attempts to come clean. It doesn’t go so well. Perhaps because he’s trying to do it in Scotland. In the end, he steals thousands of pounds from his…

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  • Get ahead of the Great Crypto Escape

    The next financial crisis is coming. Never mind what it is though. You don’t really need to know. What you do need to know is that they happen with a certain regularity. And we’re well overdue. We don’t look at…

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