Investment views based on the cycles and economic fundamentals.
Not all views expressed in this blog are in line with the views of F&C.
Investment Chart Kondratiev Wave
Tuesday, 22 May 2012
!0 year Germany going to 0.5-1% (Buckley)
This morning George Buckley from deutsche bank sold his moderately optimistic gospel for the short term and the pessimistic gospel for the long term.
It is becoming abundantly clear that Europe is in a Japan scenario. The 10 year yields of Germany are following the script precisely. So yields will go to 1% and then stay there for ten years at levels of 0.5-1%.
Real yields are so low for a good reason: growth will be slow in the next century. The UK will see lower growth than the average since 1830.
It is also ridicilous that economists don't believe the Bank of England and that inflatie will be only 2%, not the 2.5% of the consensus.
Yes they were wrong after 2008, but they were pretty close to target from 1997-2007.