Hi guys is anyone concerned with the slow creep of world interest rates or is it just me. It seems all the recent liquidity surge is resulting in a crowding out effect. Everywhere rates seem to be onthe move up. Also worrying is the recent rise in US unit labor costs into a slowing economy.
The thing about rising rates is they have a much higher neg correlation to corporate earnings than anything else so it could be interesting to see how this plays out.
Personally I still think the markets go higher as it isnt that big a deal yet BUT the current central bankers strategy of slow and steady mininalist rate rises can go horribly wrong and bite them in the arse if the market starts to think they are behind the curve THEN watch these markets crack.
A more decisve line of action should definately be taken in countries like the UK where property contiunes to surge and I still feel the US never raised to a high enough level which has allowed this pent up inflationary demand to continue to fester
Just my thoughts
The thing about rising rates is they have a much higher neg correlation to corporate earnings than anything else so it could be interesting to see how this plays out.
Personally I still think the markets go higher as it isnt that big a deal yet BUT the current central bankers strategy of slow and steady mininalist rate rises can go horribly wrong and bite them in the arse if the market starts to think they are behind the curve THEN watch these markets crack.
A more decisve line of action should definately be taken in countries like the UK where property contiunes to surge and I still feel the US never raised to a high enough level which has allowed this pent up inflationary demand to continue to fester
Just my thoughts