You're now leaving the Market Thinking website

Please note that you are about to leave the website of Market Thinking and be redirected to Toscafund Hong Kong. For further information, please contact Toscafund Hong Kong.


Insight - Making Sense of the Narrative


The timing of US tariffs on Chinese EVs and Solar panels is political, but they also signal a significant shift in the Global Economy as Globalisation rapidly unravels. The reality is that China's competitive advantage is actually in automation, network effects, an integrated supply chain and a huge home market, which means that pretending it is about cheap labour and subsidies achieves nothing other than punishing consumers. Europe in particular can't compete with China because its energy costs are too high thanks to US led tariffs on Russia and the madness of net zero policies and US pressure to match these new tariffs threatens to seriously unbalance the unity of the EU - already troubled by populist push back against the key Globalist policies of open borders and net zero. Perhaps most important though is that a US economy that has successfully cut its import dependency is one that has every incentive to talk down the $

A new government and a crisis mini-Budget are perfect catalysts for macro traders to double down on existing large and already highly profitable strategies and to produce persuasive narratives to back it up. Thus, going into month and quarter end...

Bringing together our series on Model Portfolios, we show how a balanced 60:40 Portfolio of Equities and Bonds based on our Global Bond Model Portfolio combined with either our Global Equity Factor Model Portfolio (Portfolio 1) or our Global Equity Theme Model Portfolio (Portfolio2) show different risk return profiles, but both show better returns with much lower risk than the benchmark.

A little noticed (by most) statement came out in early July – effectively the day of Boris Johnson’s resignation – from an unusual source, a joint press release by Britain’s MI5 and the US FBI. The statement was on China and essentially stated that the biggest threat the UK faced was from Chinese competition

The world of FX reserves has been upended over the freezing of Russia’s assets in a way not seen since Nixon closed the Gold Window in 1971.