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TS Lombard has a 30 year track record in making bold, off consensus-calls at major inflection points in economicspolitics and markets. For example, building on our global economic and financial analysis to find imbalances and fragilities, we identified the coming storm of the Global Financial Crisis – identifying the crucial turning point in the cycle and calling the stock market bottom as recovery began.

We are at another inflection point. We are convinced bears, and expect the S&P 500 to fall at least 20% with longer lasting downward pressure. On our analysis stock market bulls are wildly optimistic in pricing earnings returning to ‘normal’. The private sector recovery will be slow, even assuming no resurgence of the virus. Incomes have been hammered. Companies and households have no desire to invest or spend. CapEx is on hold and household savings rates are soaring and will stay high. Our forecast is that the full year 2020 will see US GDP down nearly 4% (still -3% YoY by 2020 Q4) and the EA’s down by 8.5%. World growth will be depressed for years. The recovery from this year’s recession will only get GDP back to 2019 levels by 2022. To access all our research relating to the virus and what it means for growth and asset prices please register for trial access.

'Bloomberg Surveillance' Full Show (07/09/2020)

'Bloomberg Surveillance' Full Show (07/09/2020)

What June’s job report may imply about the U.S. economic recovery

What June’s job report may imply about the U.S. economic recovery

U.S. budget deficit will increase next year regardless of election result, economist says

U.S. budget deficit will increase next year regardless of election result, economist says

COVID-19: In-store shopping in the US begins, but retail sales remain low

COVID-19: In-store shopping in the US begins, but retail sales remain low

Market trading on a view of 2021 that isn’t going to happen, economist warns

Market trading on a view of 2021 that isn’t going to happen, economist warns

China’s rising debt problem could ‘come to haunt us very soon’: TS Lombard

China’s rising debt problem could ‘come to haunt us very soon’: TS Lombard

Zero progress made in Brexit negotiations, analyst says

Zero progress made in Brexit negotiations, analyst says

India's Economy is in Shreds, TS Lombard's Deveshwar Says

India's Economy is in Shreds, TS Lombard's Deveshwar Says

09 Jul 2020 - Dario Perkins

Can Europe outperform during America’s COVID-19 secondwave?

Europe is having a better crisis than the US, with COVID-19 seemingly under control and the sclerotic labour market preventing mass unemployment. Policy has protected jobs, rather than the income of the jobless. Yet it is questionable whether this will lead to sustained “outperformance”, especially if the crisis requires lasting structural change.

26 Jun 2020 - Steven Blitz

Politics of unemployment to reign

  • As the economy reopens, the revealed recessionary environment will reflect the imbalance of the expansion just ended – a surplus of service-related workers with no obvious direction in which to go to find re-employment.
  • We consequently expect the economy to be in a slow grinding recovery even 18 months from now, weighed by the overhang of excess labour, moving along a trajectory greatly dependent upon the fiscal responses enacted both this summer and next.
17 Jun 2020 - Dario Perkins

COVID-19 and secular stagnation - the next business cycle

The 2010s expansion has ended, a “low-nominal” environment dominated by a bad macro policy mix and secular deflationary forces. Breaking out of secular stagnation will not be easy – even with more activist fiscal policy. De-globalization, demographic shifts and technological change will also create a more challenging market backdrop for the 2020s.

Why the People’s Bank of China is having a good coronavirus pandemic

07 Jul 2020 - South China Morning Post

Larry Brainard, chief emerging market economist at TS Lombard, an independent investment research firm, feels that PBOC awareness of shortcomings in China’s financial system and “the recognition that [Chinese] savers matter” have characterised the monetary policy response.

China's shadow banking likely to stay in contraction as lenders get cautious

07 Jul 2020 - S&P Global

"The still relatively slow improvement in shadow banking activity indicates that credit is not moving fast enough to [small and medium-sized enterprises] and the real economy," Rory Green, China economist at TS Lombard, told S&P Global Market Intelligence.

China’s Stocks Are on a Tear. Can They Keep Going?

06 Jul 2020 - Barrons

Other factors have bolstered Chinese stocks, TS Lombard’s Rory Green says, including state media talking about the broader benefits of a “healthy bull market” and three consecutive months of “northbound” inflows—or foreign investors using Hong Kong brokerage firms to invest in mainland China—after a sharp decline in March.

The Fed is rightly wary of embarking on yield curve control

04 Jul 2020 - Financial Times

The central bank may want to shrink its balance sheet “once the world gets back to normal”, said Steven Blitz at TS Lombard.

TS Lombard's is the only research that has helped me to achieve some understanding of the tectonic shifts in the global economy over the last thirty years.
Anna Gaworzewska, Head of Country Risk Economics, Lloyds Banking Group
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Richard Rock, Founder & Chief Investment Officer, The Caprock Group
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Ian Ling, Ashburton Investments and Private Investor

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