But there is a price for that downside protection: underperformance when markets rise sharply.
Nobody much cares about how companies make money when markets rise.
If central banks focus on asset markets when they rise as well as when they fall, they will remove much of the froth.
Gold acted as a safe haven in the sense that it did tend to rise when stock markets fell sharply.
However, there is a danger that, when labour markets are gummed up, a cyclical rise in unemployment can turn into a structural one making it impervious to an economic upturn.
Asian Pay Television's IPO comes at a time when Southeast Asian markets and equity offerings are on the rise.
WSJ: Asian Pay Television Poised to Raise $1.1 Billion in Singapore IPO
The days are gone when clients could be persuaded with charts purporting to show that the stock markets rise 10 percent a year, or demonstrating how a certain hypothetical investment strategy could get their nest egg to a million dollars by the time they reach 65 years old.
That means consumer retrenchment when interest rates rise or the bills come due, which will hurt emerging markets if they do not work harder to generate domestic demand, instead of relying on exports for growth.
The fear (think Mexico in the early 1990s and Southeast Asia a few years later) is that Big Finance will overwhelm these smallish capital markets and then, when the winds shift (usually as interest rates or risk premiums rise), pull out--with panic at the door.
It is a great relief to hear the FAO be partially market savvy when they say that speculators trading commodities on the financial markets are not to blame for the huge rise in prices.
FORBES: China Tackles Inflation. Food Prices Rising. Good For Monsanto & Syngenta.
That means that when markets and management fees crumble, costs have a nasty habit of staying fixed or even continuing to rise.
Yet, when sentiment was on the rise, as with QE2, the perception was that it hugely affected the equity markets.
应用推荐