20 January 2019

Daniel Lacalle

PhD Economist and Fund Manager
  • ECB president Mario Draghi has been reminding eurozone governments that they needed to implement structural reforms and use the period of low rates to deleverage. No one listened. Photo: Reuters

    The ECB’s quantitative easing failure

    - Dec 17, 2018 1:28pm
    The main reason why the European Central Bank’s quantitative easing program has failed is that it started from a wrong diagnosis of the eurozone’s problem – that the European problem was a demand and liquidity issue,...
  • Pro-EU demonstrators protest outside parliament in Westminster, London. Photo: Reuters

    Brexit: A deal that pleases no one

    - Nov 21, 2018 12:22pm
    The agreement announced between the British government and the European Union has been received in the United Kingdom with criticism from all sides. The defenders of staying in the European Union consider it very negative, of...
  • Former US President Barack Obama campaigned hard for the Democratic candidates in the midterms. The Democrats regained control of the House but the Republicans strengthened their majority in the Senate. Photo: Reuters

    US midterm elections: few changes, similar challenges

    - Nov 12, 2018 11:36am
    The midterm elections in the United States have produced a result that was very similar to what the surveys estimated. The “blue wave”, an overwhelming victory by the Democratic Party that was predicted by some, did...
  • The question now is not if there will be another major global financial crisis, but when, experts say. Photo: Reuters

    The next financial crisis

    - Nov 2, 2018 12:33pm
    We have been reading numerous comments recently about a forthcoming recession and the next crisis, particularly on the tenth anniversary of the collapse of Lehman Brothers. The question is not whether there will be a crisis,...
  • The global stock market slide had many traders and investors scratching their heads. Photo: Reuters

    Market crash? Another red card for the economy

    - Oct 15, 2018 4:23pm
    A few months ago I wrote this article at the World Economic Forum called “A Yellow Card For The Global Economy“. It tried to serve as a warning on the rising imbalances of the emerging and...
  • Traders work on the floor of the New York Stock Exchange. Concerns surrounding rising interest rates again took center stage after US government debt yields hit highs not seen in more than seven years. Photo: Reuters

    The US Ten-Year shows the extent of the bond bubble

    - Oct 10, 2018 11:34am
    “Only when the tide goes out do you discover who’s been swimming naked.” – Warren Buffett  The US 10-year bond has reached, at the close of this article, a yield of 3.2 percent, the highest since...
  • Brazil needs to open its economy further, abandon socialist populism and attract capital. Photo: Reuters

    Brazil faces significant challenges

    - Oct 3, 2018 11:16am
    Uncontrolled spending and ruinous results: Brazil has been a prime example of the policy of “more is less”. Under Luiz Inácio Lula da Silva and Dilma Rousseff, the country felt invincible and believed that entering into...
  • China is using an artificially high yuan to buy cheap resources with the endgame being a massive devaluation in a few years' time. Photo: Reuters

    Is China a currency manipulator?

    - Oct 2, 2018 11:55am
    The US administration has avoided the debate on currency manipulation in the past years due to the impact of the financial crisis. Why? Because all major economies have tried to solve their imbalances through the same...
  • When oil prices rise abruptly we should be concerned because they can cause a domino effect on the real economy. Photo: Reuters

    Is the oil burden a rising problem?

    - Sep 28, 2018 3:29pm
    While markets become increasingly bullish, oil prices are close to a “warning zone” where the barrel could be one — if not the only — catalyst of a major slowdown. The concept of “Oil Burden” is...
  • The Indian rupee has fallen to an all-time low, becoming Asia's worst-performing currency this year. Photo: Bloomberg

    India: The biggest risk in emerging markets?

    - Sep 12, 2018 9:58am
    The biggest mistake in analyzing macroeconomic data is to assume causality to factors that are just catalysts. Don’t blame the Fed or Trump. That is just noise. The problem of emerging markets is largely self-inflicted and...
  • A trader works on the floor of the New York Stock Exchange as the Dow Jones Industrial Average passes the 25,000 mark in January this year. There has been an intense debate as to whether the market has become too expensive. Photo: Reuters

    Why I believe the US stock market is cheap vs others

    - Sep 10, 2018 3:13pm
    The stock market, like any other market, is a set of relative opportunities, not absolute ones.I have never seen a more pessimistic environment despite a stock market that continues to reach all-time highs.  Many friends are...
  • Beijing’s stealth currency devaluation will make Chinese household and corporate debt riskier, experts say. Photo: Reuters

    Why stealth yuan devaluation will hurt rather than help China

    - Aug 29, 2018 4:52pm
    I find it amusing to read some analysts stating that the Chinese government’s stealth yuan devaluation has offset the impact of tariffs. A 10 percent tariff hurts a small part of the economy. However, a 10...

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