Correct \’Haircuts\’

\’Haircut\’ is a term that has a precise meaning in finance.  But many journalists and commentators use the term incorrectly, which is unfortunate because \’haircuts\’ have played a major role in the GFC.  Knowing what haircuts really are is crucial to understanding the liquidity crises of the GFC.

Eyes on the prize

Tennis racquet with tennis balls against clay court

Sporting tournaments, such as Wimbledon, The Masters and The Melbourne Cup, receive great fanfare, but much more important \’tournaments\’ are playing out continuously in the economy.

Inflation or deflation?

Inflation fell rapidly in every major economy during 2014 – see the graph below.  In 2015 global inflation has temporarily stabilised at very low levels.  What will happen next is the biggest question facing global investors.