Providence Capital

What went well and what could have been better? Financial markets started the year on a positive note: bonds were in demand, if rates fell. Equities saw a way up, after a difficult 2022. The first bump came in March, when a minor US banking crisis took place. Doubts about the solvency of small banks, … Read more

We fought many plagues Of course, first we had to fight the pandemic. We did that spending a lot of money. Many millions of people, in the US, in Europe, in all kinds of countries, were given money without having a job. Nor were they in a position or even allowed to work. The huge … Read more

Economic complaints are raining down from all sides, often with increased interest rates as the deeper background. And yet this monthly report is titled: interest rate happy? Was this perhaps a typo? After all, who gets happy about higher interest rates? In fact, it acts like a grindstone, slowing down economic growth. Everything just goes … Read more

Inflation rates fell, while interest rates rose sharply in September. The explanation is possibly because statistics look back, but markets look forward. The oil market, which is important for inflation, looked tight and prices rose sharply. That price rise has yet to feed through to the rest of the economy. And even if inflation now … Read more

A few years ago, the financial world was as beautiful as Goldilocks: self-evident growth and low inflation. But it looks like it’s ugly stepsister has taken over. The manufacturing economies of this world are struggling. The West is ordering less, so the East, starring China, South Korea, Japan, and Taiwan, is getting fewer export orders. … Read more

This could be an account of a first boring summer-month. Do I hear ‘’summer”? When I step into the municipal outdoor pool early in the morning, it turns out to have cooled down considerably due to the rain, to about 19 degrees. I would have been better off stepping into the North Sea at around … Read more

It is starting to get a bit boring: interest rates, rising further as core inflation remains high, especially in Europe (around 5.5%). Energy prices do help ‘headline inflation’ to come down, except in Germany and the Netherlands (+6.8%) but sticky inflation remains sticky. The goods industry is slowing or stagnant while the service sector continues … Read more

There are increasing signs of a recession in the goods sector: during the pandemic, parcels were flying around our ears. Then we were stuck and could not even go out or on holiday either. We are now catching up, but we have had enough of buying stuff for a while now. That is why many … Read more

Inflation can also be profitable The earnings season has started again. Caution about profits has been trumped up for some time, but it still appears to be unwarranted. Companies in the food sector, such as Unilever, Procter & Gamble, Ahold, Coca Cola and Nestlé almost all managed to increase their sales prices more than expected. … Read more