Kung Hei Fat Choi!

1 min
February 1, 2022
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Today is New Year’s Day for Greater China and much of South East Asia and so a wish for health and prosperity for all friends and colleagues who are celebrating (as best they can).

The Year of the Tiger for almost 2bn people.

The Year of the Tiger isn’t just being celebrated in China of course, but across much of Asia. Singapore, North and South Korea and Cambodia have the same symbols to China and while Myanmar, Thailand, Vietnam and Japan have some slight differences in some years, all of them celebrate the year of the Tiger. Indeed, even before we include mainland China itself, that is a population of over 478m people and once we add in the 1.44bn in China that is 1.92bn people celebrating this week!

For those less familiar with the Chinese system, there are twelve animals that move in rotation, and this year is the Year of the Tiger. Each animal has 5 elements, Wood, Water, Fire, Earth and Metal, so that the birth year only comes around again once in a lifetime on the fifth cycle. This year is the turn of the Water Tiger, sometimes referred to as Tiger Crossing a mountain, last seen in 1962. For those interested in more detail, here is a reasonable place to start.

One of the more disappointing developments in the last few years has been the return of orientalism and the ‘othering’ of Asia in general and China in particular. This seems to be largely for US Geo-political reasons and comes at a time when we should all be trying to learn about and understand other cultures. The Chinese horoscope, and in particular its notion of the generating and controlling cycle of the elements, is an important window on Chinese philosophy and for that reason alone should be taken a little more seriously in the west.

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Market Thinking May 2024

After a powerful run from q4 2023, equities paused in April, with many of the momentum stocks simply running out of, well, momentum and leading many to revisit the old adage of 'Sell in May'. Meanwhile, sentiment in the bond markets soured further as the prospect of rate cuts receded - although we remain of the view that the main purpose of rate cuts now is to ensure the stability of bond markets themselves. The best performance once again came from China and Hong Kong as these markets start a (long delayed) catch up as distressed sellers are cleared from the markets. Markets are generally trying to establish some trading ranges for the summer months and while foreign policy is increasingly bellicose as led by politicians facing re-election as well as the defence and energy sector lobbyists, western trade lobbyists are also hard at work, erecting tariff barriers and trying to co-opt third parties to do the same. While this is not good for their own consumers, it is also fighting the reality of high quality, much cheaper, products coming from Asian competitors, most of whom are not also facing high energy costs. Nor is a strong dollar helping. As such, many of the big global companies are facing serious competition in third party markets and investors, also looking to diversify portfolios, are starting to look at their overseas competitors.

Market Thinking April 2024

The rally in asset markets in Q4 has evolved into a new bull market for equities, but not for bonds, which remain in a bear phase, facing problems with both demand and supply. As such the greatest short term uncertainty and medium term risk for asset prices remains another mishap in the fixed income markets, similar to the funding crisis of last September or the distressed selling feedback loop of SVB last March. US monetary authorities are monitoring this closely. Meanwhile, politics is likely to cloud the narrative over the next few quarters with the prospect of some changes to both energy policy and foreign policy having knock on implications for markets/

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