Last Friday’s events in the Middle East had significant effects in the global markets: the S&P dropped more than 1.5%, while the emerging markets indices fell between 2-3%. In this Sunday afternoon, we want to share with you where we stand before markets open tomorrow. The most relevant question is whether events will trigger a read more

The EU leaders are most likely close to key decisions about the future of the euro. The financial rescue package announced during the Greek episode of the crisis last year was designed to buy time in order to work on solving the fundamental problems. That package was not enough to stop the crisis domino at read more

The beginning of the year renders itself for rethinking medium-term issues, especially risks. As the ‘Market Views’ section of this site shows, we at Baffin Advisors revisit our views about the global economy and markets constantly. However, we used the beginning of the year to send a letter to our clients with an extensive review read more

This last bout of the euro crisis was to a large extent triggered by the debate on how to improve the EU institutions. It is paradoxical that the right conceptual issues can accelerate the crisis that originates from the euro fundamental institutional flaws, but it is what is happening. The Germans decided to openly discuss read more

The current debate about currency wars, the G20 meeting, QE2 (quantitative easing by the US Fed), it all makes for great Op-ed opportunities and commentary. One relevant question we prefer to focus on is that of asset pricing implications (preferably in the medium-term) and how to position our portfolios accordingly. This note is not a read more

We are at an interesting junction in the markets, with this non-trivial rally in front of significant uncertainties around the world: elections in the US next week as well as very relevant announcements expected from the Fed, while global rebalancing is being ‘designed’, the EU discussing major institutional reform and the developing world continues to read more

The independence and incentives of an asset manager are key factors towards efficient and productive portfolios (from the clients’ point of view). The asset manager’s compensation rule is maybe the most important component of his incentive structure, and as such it has to be analyzed and designed rigorously. Transparency is a core value at Baffin read more

The high volatility of the last few months has generated panic moments in the markets, perceived uncertainty about future scenarios, and sharp inconsistencies in some of the public policy debates. Though there are reasons to marginally re-shuffle the probability distribution among the most likely scenarios, there is no real reason to change the base-case scenario. read more

The lower house of congress in the US has just approved the Healthcare Bill that the senate had approved recently. This has not been priced into the market with a very high probability, at least not with this timing. Futures (that trade overnight) is showing the S&P500 at -0.8%. The negative interpretation markets seem to read more

Last week Dubai World’s announcements generated a major shock. It triggered a new debate about excess liquidity, bubbles and re pricing. In that framework, it would be expected that the emerging markets would suffer the most. We believe that the volatility caused by the Dubai World news will not generate a big spill-over-effect, and most read more