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E-Commerce Surges in Southeast Asia
Present growth trends and adoption of e-commerce in Southeast Asia are reminiscent of the United States in 1997. In that year, a young American company called Amazon.com reported sales growth over 800% 1. Two decades on, Amazon's growth story has become well-known and e-commerce has become a significant part of the U.S. retail economy. In Southeast Asia, a collective market
The End of Shareholder Primacy?
The recent decision by America's Business Roundtable to abandon its support for shareholder primacy was a long time coming, and reflects a broader shift toward socially conscious investment. Now that the multi-stakeholder model is receiving the attention it deserves, it will be incumbent on governments to create space for it to succeed. MILAN – This month, the Business Roundtable, a
Global Fetters: Insights From Jackson Hole
The institutional “golden fetters” of the interwar period have been replaced by fundamental “global fetters” that severely constrain monetary policy. While Federal Reserve Chair Jay Powell’s speech at the Jackson Hole Economic Policy Symposium last week didn’t break any new ground other than confirming market pricing for further near-term rate cuts, several academic papers presented at the symposium and Bank
Plenty to Worry About, but Not Much to Do
Every summer for the past several decades I have organized a series of Friday lunches in eastern Long Island for serious investors. More than 100 people attend the four sessions, with 25–30 at each one. The participants include hedge fund, private equity and real estate billionaires, venture capitalists, an academic and some corporate leaders. I moderate a discussion of the
Can a Growth Scare Benefit Tech Stocks?
Given the recent volatility, investors may be wary of tech. Not so fast, Russ explains. Despite an abrupt and punishing market swoon that disproportionately punished more volatile sectors, technology is holding its own. During the past month the sector has outperformed by roughly 100 basis points (bps, or one percentage point). Even with the prospect for more volatility, investors may
Yield Curve Inversion: Markets Are Correct to Price In Higher Recession Risk
On 14 August, the yield spread between two-year and 10-year U.S. Treasury bonds moved below zero for the first time since February 2006. Though it has since widened back to positive territory, the move was significant because such “inversions” of the yield curve – in which short-maturity yields exceed those for longer-maturity bonds – have preceded nearly all recessions dating
Takeaways on the Yield Curve Inversion
Economic Blog A closely watched point on the Treasury yield curve has fallen negative for the first time in this economic cycle. As shown in the LPL Chart of the Day, Yield Curve Inversion Raises Economic Questions, the spread between the 2-year and 10-year Treasury yields fell as low as -2 basis points (-0.02%) in trading on August 14. Read
A Sustainability Framework: Societal Shifts as Investment Risks
Successful long-term investing depends upon the identification of sustainable companies. We believe traditional investment analysis tends to underestimate some risks faced by companies today. In particular, we see rising risks to sustainability from the potential breakdown of relationships between industries and companies with society. Each company and industry operates under a "societal license” that, if damaged or revoked, can ultimately
ECB Signals Easing, But What’s Left in the Policy Arsenal?
Acentral banker’s nightmare is losing control of inflation expectations. Whereas decades ago the challenge facing major central banks was reining in overly high inflation expectations – a process that ushered in central banks’ independence and inflation targets – the European Central Bank’s (ECB) challenge today is reviving unduly low expectations up toward its stated aim of “inflation rates below, but
5 Key Investment Themes for the Remainder of 2019
Rick Rieder and Russ Brownback highlight the investment themes that they think will drive markets and dominate debate within the investment community over the next several months and beyond. Over recent weeks, we have been vocal about five “big themes” for markets that will likely dominate the second half of 2019. These themes take stock of a collection of secular