Global Investment Strategy

Special Report on U.S. Elections & BrExit

Date: 2016-03-15 - Prepared by: The GISI

In this report we analyse investment implications of U.S. elections and of a potential BrExit.

The finance community in the US seems convinced that Hillary Clinton is the next President and this complacency is reflected in stock and bond prices. The UK market seems more hesitant and some of the risk is priced in. We look at the Canadian market performance during the 1995 Quebec independence referendum and compare that to today’s environment.

The US and the UK have a negative Net International Investment Position (a.k.a. Net Foreign Debt). In fact, the total Gross US Debt is around US$ 30 Trillion, hence any drastic political changes will most likely have significant economic policy implications which may lead to foreigners pulling back some of their investments.

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