Hey, don’t worry I’m not suffering a mild case of schizophrenia here… although it was important to get your attention.
You know my views… I wrote about them last week.
But not every one agrees with me, so I thought we should consider their argument.
…and then I want to add more weight to the my point of view, which I think you will find really valuable.
Here we go…
A few pundits are saying that we could be staring down the barrel of interest rate increases sometime this year – that the next move in interest rates could be up.
HSBC chief economist Paul Bloxham (ever heard this guy talk? Refined tone, very intelligent, super smart and convincing) has gone out on a limb and is telling anyone who’ll listen that this easing cycle is over.
He’s still a lone voice in that noisy boredom (the collective noun) of economists, but there’s a certain logic to his argument.
Rates are at record lows and at what is obviously a very stimulatory level.
Unemployment is steady at a pretty low level (any nation in Europe would be over the moon with 5.4 percent!) Growth seems to be returning to trend as the big international issues that threatened the outlook late last year seem to have sorted themselves out.
America is up and going again (the Dow is at an all time high as I write this), China is back on track and Europe is more funny, but also more stable.
In the old days, it’s exactly this change to the outlook that would drive a reversal of rates from levels like these.
But that was the old days.
Bloxham hasn’t realised that the game has changed. Radically. Put away your bat and get out your footy boots.