For some time now Westpac has considered selling its New Zealand banking operations on the heals of the Reserve Bank of New Zealand requiring banks to separate local banking operations and capital from international ones. A prime take over candidate could be HSBC. While “the world’s local bank” is no longer expanding internationally at the…Read More
There is no doubt that commodity prices and overall inflation have soared since the Coronavirus lockdowns in 2020. A combination of base effects, quantitative easing, an exodus from cities and supply chain disruptions have lead to massive year on year changes in CPI. The included image is an overlay of CPI from 2001 to 2014…Read More
The Debt Supercyle Bridgewater founder Ray Dalio along with others have pointed out that there are a lot of similarities between the 1920s and the 1930s and today, both times being the end of a debt supercycle and the fourth turning within the Strass-Howe generational theory. While history doesn’t repeat but rhymes and some of…Read More
We seem to be nearing the end of the current debt supercycle where the marginal return on debt across society (individual, corporate and government) is no longer enough to produce growth, and so some form of deleveraging of the debt has to occur. This can be in the form of inflation or deflation, but either…Read More
The recent acceleration in technological change has brought a lot of talk of universal basic income (UBI) as the future for developed economies. While there are a lot of formal arguments that could be made against this, I thought it better to present a vision for a better world, if robotics and AI really are…Read More
Apologise for the break for June and July, we were in the process of moving and markets were relatively mixed over the summer months. A reminder that the two distinctive features of the 1332 Capital newsletter are that views are communicated over different time periods (immediate, cyclical and secular) as well as tracked between newsletter…Read More
Conventional economic theory states that during a recession interest rates should be lowered to spur lending. In practice, there is an argument to be made that this actually perpetuates the recession and leads to asset bubbles, debt supercycles and an increase in wealth inequality. 1. Clear bad debts faster giving room for the economy to…Read More
Inflation can mean very different things depending on what monetary system and part of the business cycle an economy is currently in.
Welcome to our inaugural monthly market newsletter. The newsletter will summarise our current analysis on the economy and markets from different macro time periods; immediate term, cyclical and secular. Immediate term reports what is happening in the present and recent history, the last trading day, week, and month. Cyclical tracks on a quarterly basis where…Read More
The past year has certainly seen more financial institutions adopt Bitcoin as a reserve asset, either for themselves or for their clients. Several news outlets have reported that BNY Mellon will hold, transfer, and issue Bitcoin on behalf of its clients. The use of the word issue raises the question as to whether they will…Read More