Who will still want those guzzlers later on?
The bulk of US economic growth this year can be attributed to data centers. But what will all that infrastructure be worth once chips arrive that are a hundred times more energy-efficient than today’s models?
Chart of the week: 海 市 蜃 楼
The title of this column is the Chinese word for “mirage” or “illusion.” Hot air, in other words. Just like the impressive Chinese growth figure that was proudly announced this week.
Vive la France!
Last week, the French government survived two motions of no confidence, mainly by promising not to raise the retirement age from 62 to 64 for the time being. For S&P, however, this was reason enough to downgrade France’s credit rating from AA- to A+. It may seem like a minor detail, but for managers of fixed income funds that require at least AA-rated investments, it created an immediate problem. Did all those French government bonds suddenly need to be dumped?
The reverse silk road: why Asian money now lands in Luxembourg
Asian investors are turning to Luxembourg as their preferred gateway to global private markets. The flows are quiet but transformative.
Chart of the week: the balance dance
The word is out! Fed Chair Jay Powell is considering stopping the reduction of the Federal Reserve’s balance sheet. If you think that balance sheet has slimmed down significantly after three years of quantitative tightening, you’re mistaken. Moreover, Powell is putting himself in an impossible position once again by lowering interest rates at the same time.
Forget ‘superstar city’: a new look at REIT cash flows
A groundbreaking study shows that “superstar cities” systematically lag in total returns — a crucial insight for valuing REITs (real estate investment trusts). The explanation lies in lower rental yields and surprisingly low risk, which fundamentally changes how future cash flows should be assessed.
Donald Trump and the Nobel Peace Prize
The recent developments in the Middle East make one thing absolutely clear: president Donald Trump deserves the Nobel Peace Prize. This is the logical conclusion if we look at what the prize is supposed to reward: concrete peace achievements that save lives.
The death of IPOs, long live Luxembourg
The public markets are shrinking, but private capital is booming, and Luxembourg is quietly building the exchange of the future.
Chart of the week: the euro is heavily overvalued
So far this year, the euro has appreciated by no less than 13 percent against the US dollar. That drop in the dollar’s value — because that’s what it really is — was first explained as America discarding its “exceptionalism” under Trump.
Answers from the campfire
Last week, during the Fund Event, I sat in a packed room around a metaphorical campfire. This time, questions didn’t come through the chat, but as paper airplanes floating through the air. Some landed in the fire and were answered immediately. Others fell into the ashes. Time to pick those up.