The Flip Side

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Will European equities outperform the US in 2025? Feb 06, 2025

Show notes

Europe is the top performing region year to date in equity markets. Can this outperformance be sustained given the Stoxx 600 has underperformed compared to the S&P 500 over the last 25 years? Even backing out Big Tech from indices, European stocks are significantly discounted compared to their American peers.

In episode 68 of The Flip Side, Venu Krishna, Head of US Equity Strategy & Global Equity Linked Strategies, and Emmanuel Cau, Head of European Equity Strategy, consider the factors investors should watch, from the macro and geopolitical backdrop on both sides of the pond, to the influence of the Magnificent 7 and currency and rate effects.

Clients can read further analysis of these topics under Equity Strategy on Barclays Live.

Does inflation still matter? Jan 15, 2025

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Inflation has been a critical focus for investors in recent years. US headline PCE and CPI peaked at 7.2% and 9.1% in mid-2022, but with levels coming down toward the 2% Federal Reserve target rate, is it still worth the attention? Or can investors go back to more or less ignoring inflation, as they did pre-pandemic?

In Episode 67 of The Flip Side, Brad Rogoff, Global Head of Research, and Mike Pond, Head of Global Inflation-Linked Research, dive into these pressing questions, examining the lingering risks of inflation being stuck at levels just high enough to influence Fed policy, as well as potential shifts in the labour market and tariffs, which could drive inflation risk.

Will Trumponomics be incremental or transformational? Dec 11, 2024

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US President-elect Donald Trump has indicated his incoming administration will make major policy changes on everything from tariffs to taxes, all the the potential to transform the global economy. Will Trump's policies lead to sweeping economic change or will the effects be incremental? In episode 66 of The Flip Side, Brad Rogoff, Head of Research and Global Chairman of Research, Ajay Rajadhyaksha, dive into these big questions.

They examine the potential effects of implementing large-scale immigration reforms and deportations, which would have ripple effects on the labour market, particularly for industries reliant on undocumented workers. Brand and Ajay also explore the promise of deregulation, debating whether reducing regulatory hurdles for businesses can truly accelerate economic growth. Lastly, they tackle looming questions around tariffs and tax cuts, considering their potential to disrupt or stimulate trade and investment.

Is China’s economic stimulus a game-changer or window dressing? Oct 10, 2024

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Interest rate cuts, reduced down-payment requirements for mortgages and media reports of the re-capitalisation of banks – are just a handful of the policy changes the Chinese government announced in its recent stimulus package to get the $18trn economy moving.

Chinese financial markets have initially reacted positively, with the Shanghai Composite Index and Hong Kong Stock exchange soaring on the news. And with additional measures expected, markets seem poised to benefit from further momentum.

In episode 65 of The Flip Side, Global Chairman of Research Ajay Rajadhyaksha and Head of Asia Cross-Asset Strategy Kaan Singh discuss the stimulus policies and consider whether they are large enough to reinvigorate China’s economy or simply ‘window dressing’ tactics.

Does market volatility risk a US hard landing? Aug 14, 2024

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Recent volatility in global financial markets has left analysts and investors speculating whether it is being driven by technical factors or more fundamental shifts indicating a looming US recession.

Inflation, rising US unemployment and heightened geopolitical tensions are considered major catalysts for the volatility. The unease in markets was exacerbated by the unwind of the yen carry trade and swirling questions about the Magnificent 7 tech companies’ pace of AI adoption.

In episode 64 of The Flip Side, Global Head of Research Jeff Meli and Global Chairman of Research Ajay Rajadhyaksha discuss recent financial market dynamics and debate the re-emergence of a hard landing for the US economy.

Will investors benefit from the 'equitification' of credit markets? Jul 10, 2024

Show notes

Corporate bond and loan markets have traditionally been rigid when compared to equity markets, characterised by low liquidity, low trading volumes and higher transaction costs. In recent years, the explosion of credit ETFs and the growth of private credit markets has meant all that is changing, causing what our Research analysts call the ‘equitification’ of credit.

In episode 63 of The Flip Side Global Head of Research Jeff Meli and Head of Thematic Fixed Income Research Zornitsa Todorova debate the upsides and downsides of this emerging trend and which investors stand to benefit.

Can consumers curb their carbon addiction? Apr 24, 2024

Show notes

US carbon emissions are down c.20% from their peak over the past 20 years, thanks primarily to efficiency gains, such as increased miles per gallon for cars, switching to LED lights and moving towards high-efficiency boilers.

Further emission reductions will require more changes from consumers on a number of fronts, such as switching from fossil fuels to electricity for cars, home heating, and so on.

The US government is trying to influence behaviours through a range of subsidies and incentives. Is pushing on all fronts the best approach, or should efforts concentrate on one big issue that can have an outsized impact over the long term?

In episode 62 of The Flip Side, Global Head of Research Jeff Meli debates that question with Will Thompson from our Sustainable and Thematic Investing Research team.

Can the Fed take credit for declining inflation? Mar 12, 2024

Show notes

Inflation in the US peaked at around 9% in 2022, and by January 2024, CPI inflation had fallen to 3.1%. This dramatic reduction was achieved without triggering a widely expected recession. Does the Fed’s interest rate hiking cycle deserve credit for this correction, or were other market forces responsible for the generally positive economic outcome?

In episode 61 of The Flip Side, Global Head of Research Jeff Meli debates that question with Chief US Economist Marc Giannoni, considering how factors such as market expectations, post-pandemic economic realities, shifts in labour force, and housing stock availability drove cooling alongside – or instead of – the Fed’s monetary policy.

Can AI solve the modern productivity puzzle? Feb 08, 2024

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In episode 60 of The Flip Side, Hiral Patel, Head of Sustainable & Thematic Research, talks to Christian Keller, Head of Economics Research, about the extent to which and pace at which AI could boost productivity levels globally. They explore the potential costs and benefits to businesses and societies, as well as the range of public policy changes related to education, taxation, antitrust and more that may be required if generative AI is to truly become a GPT.

Is US debt reaching crisis levels? Dec 14, 2023

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Warnings that rising US national debt levels are reaching a crisis point have waxed and waned for decades. In Flip Side podcast, our analysts discuss urgent questions about whether the current US government debt is sustainable.

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