Spellman 1When prospects dimmed for private funds to advert a collapse of the bank Monte dei Paschi (MPS), the Italian government stepped in before Christmas with a bailout to protect depositors’ savings and inject new capital so that the world’s oldest bank, and the country’s third largest, could survive.

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bod.hunter2Washington, DC, our nation’s capital and the center of governmental angst in fair times and foul, is going through its most profound trauma in years, a collective PTSD. For most of Washington’s political class, even on the Republican side of the aisle that divides the city, “this wasn’t supposed to happen.” Hillary Clinton was to be president and Donald Trump an also-ran, a showman who provided entertainment, though all-too-often holding up a mirror to the foibles and hypocrisies of those who do politics for a living.

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At a moment when much of the western world seems impotently indifferent to the destruction of a country – Syria – it is startling to be reminded yet again that thousands of Americans and Europeans risked their lives and futures in another country’s civil war. To Spain, between 1936 and 1938, came approximately 2,800 from the United States who formed the Abraham Lincoln Brigade, as well as tens of thousands more from Britain, Poland and France, all volunteers in what they saw as a battle against fascism. In far higher proportion than the Spanish defenders of the Republic they came to help, they died on the battlefields with no markers on that soil. Of those an estimated 750 were American.

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Spellman 1Central in forecasting 2017 and beyond is whether a new economic order is taking shape.  Before the U.S. elections, economists were inclined to advise investors “to expect more of the same in the months to come,” as Lazard Asset Management did in October.[1]   After Donald Trump’s win, the paradigms that shaped the U.S. and European economies and policies over the past decade suddenly seem to have abruptly shifted or collapsed.  Cheap oil.  A stock market crash, the worst since the Depression.[2]   Investment banks on life support.  Negative interest rates.  Bull market for bonds.  Deflation.  Weak dollar.  All were the decade’s recurring headlines, but these are less frequent now.  These days, it is:  Record stock indices.  Reflation.  Strong dollar.  Higher gas prices.  Bear market for fixed income.

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MichaelWhite2016As the nations and people of the North Atlantic hurtle towards 2017, the populist forces which are unraveling the certainties that have bound them together since World War II become more powerful with every passing week. Britain’s vote on June 23 to “Brexit” the European Union (EU) was not the first centrifugal explosion. But it was certainly the most dramatic signal of changing times until November 8 brought the election of Donald Trump, an economic nationalist and diplomatic isolationist, to the U.S. presidency.

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