Global Economy Archives - CMG AdvisorCentral

Is Europe Late to the Party?

Posted on 04.08.14 |

PJ Grzywacz
President, Chief Compliance Officer
CMG

È tempo per un po ’di QE? Nein danke. Vielleicht?

TRANSLATED: Is it time for a little QE? No thank you. Maybe?

Although Mario Draghi, President of the European Central Bank (ECB), announced that the Bank’s governing council is prepared to take emergency action if inflation falls too low, it may be a case of too little, too late. By emergency action, he of course means quantitative easing, which to this point has been anathema to German policy makers.

Each of the EU’s competitors has acted with some form of stimulus, loose monetary policy or unconventional quantitative easing in an attempt to stimulate growth. In the U.S. we have gone through every monetary tool in the bag. In the UK, the Bank of England is so pleased with its QE, it is considering whether it needs to make “any adjustments” (read “any” as in “any, ever”) at all to its bond buying programs. Read More >

The Ukrainian Butterfly Effect

Posted on 03.20.14 |

PJ Grzywacz
President & Chief Compliance Officer
CMG

Before the recent events in the Black Sea, few investors, financiers or market commentators would have been able to place Crimea on a map, much less appreciate its impact on the global financial markets, investment portfolios and stock market risk. The events of the past several weeks in the Ukraine and Crimea have captured everyone’s attention as hot headed media analysts talk of a new Cold War and Putin’s annexation of Crimea. The truth is much more complicated than that and the impact of these events is much more subtle than the headline grabbing sanctions against Russian oligarchs seeking to fill their shopping bags in New York or London.

The Ukraine has been at a crossroads of east and west, Europe and Asia for hundreds of years and ethnic boundaries are rarely as easily drawn as the maps we use to find these distant lands. Elections over the past several years have worn out these historic fault lines – the east pulling towards Russia and the west aspiring to join the EU. Historically, the Russians, the Poles, the Austro-Hungarians and the Ottomans (to name a few) have battled and controlled these lands at various points in history pulling the country, its borders, its culture and religion in different directions. During the second world war (or the Great Patriotic War as the Russians and eastern Ukrainian’s refer to it), these tensions were strained further as fascist resistance to communist forces moving west made a hero out of Ukrainian Insurgent Army leader, Stepan Bandera (to western Ukrainian’s) (in 2006 a statue was erected in the central square of Lviv.) While not the majority of protesters, members of the extreme nationalist right wing who were involved in driving President Yanukovych out, draw much inspiration from Bandara’s fascism and rumors are rampant about the extent to which right wing protesters were involved in scuttling the compromise, which ultimately lead to the departure of Yanukovych and then subsequent Russian action in Crimea.

Strategic Patience is Smart for Investors

Posted on 03.13.14 |

I was reading a story by Condoleeza Rice in the Washington Post titled Will America heed the wake-up call of the Ukraine? In the piece Ms. Rice counsels U.S. politicians to adopt a policy of “strategic patience.” This is also excellent advice for investors today.

What do events in the Ukraine and other trouble spots in the world mean to you and your clients portfolios? We have received a number of calls that go something like this – “with the threat of war, should I make any changes to my portfolio?” Or in other words, what they are asking is should they get out of the market, raise cash or hedge?

This is what I shared with an advisor client recently and I share it with you today.