Archive - December 2012

London Wall Partners have plenty to say on a wide number of economic and financial matters. This section provides a list of our news and views on a historic basis.

As 2012 draws to a close, three things about central banks and monetary policy are becoming more apparent.
As 2012 comes to an end, a review of the performance of financial markets indicates that it has been (at the time of writing) a relatively good year for returns. The major equity indices have managed very acceptable gains - the UK 6.5%, the US 12.5%, Europe 13.5%, Japan 10%, Hong Kong 22%.
NEWS RELEASE -
Fletcher and Beckwith join forces to form ‘London Wall Partners LLP’

Leading independent financial adviser and wealth management expert Nick Fletcher (the former Saunderson House CEO), has teamed up with global investment manager and economist Jeremy Beckwith (the former Kleinwort Benson CIO), to form London Wall Partners LLP. Launched today with full FSA authorisation, the firm is partner-owned and funded, and will provide conflict-free advice based on a thorough and unbiased assessment of the market – principally to individuals, but also to trusts.

That the Eurozone ends 2012 in an apparently stable condition is mainly down to the work of two people. The first is Mario Draghi with his promise of potentially unlimited intervention in sovereign bond markets. The second is Angela Merkel’s with her summer policy decision that forcing Greece from the Eurozone would be more damaging than keeping it in.

Sifting through the small print of the Chancellor’s Autumn Statement, which could be summarised as very much a “steady as she goes” story, one finds the breakdown of the UK economic forecasts generated by the Office of Budget Responsibility.

Gold fulfils the conditions of a perfect “medium of exchange” (or money). It cannot be created or destroyed by human whim, it has few alternative industrial uses, which might affect its value and it has a very low weight to value ratio (and so is easily transportable).
Though the financial crisis of 2008 was created in America by the collapse in value of US sub-prime, mortgage-backed securities, its consequences have been far more damaging to the European banking system than to those in the US or the UK.
The Asian economies have for several decades delivered faster economic growth rates than Western economies but their stock markets have been far more volatile. Though these growth rates are now receding, they are still expected to be much higher than in Western economies over the next decade
The Japanese stock market peaked at the end of 1989 at almost 39,000. The bottom (so far) was in early 2009 when it briefly went below 7,000. Since 2000, it has not been higher than 18,000, and is currently trading at around 9,000.
Since 1979, the UK economy has shown a level of economic growth, inflation and stock market performance that essentially corresponds to the average, Western economy.
Since the early 1980s, US consumer spending has been the driver of the global economy as its peaks and troughs have tended to lead trends in the rest of the world. It has been the most productive, large, developed economy in the world because it has been so successful at developing and applying new technology. The US stock market has been one of the best-performing markets over the last 25 years.