Ghost In The Machine
The Ghost in the Machine Q1 2024
March 19, 2024
Welcome to the latest edition of The Ghost in the Machine, which has no specific theme, but does take a look at the year ahead for Sugar and Corn, the science behind grain seed technology, while also taking a look under the bonnet of bond market asset allocation, positioning in FX, equity markets and crypto-currencies. It has been said that investors have taken a goldilocks view of the global economy and monetary policy in recent years. But as the recent market turbulence has demonstrated, there are vulnerabilities, and bond markets have a number of structural issues to contend with as they revert to a more typical term premium structure.
The dollar’s accentuated weakness to start the year owes much to an improved outlook for global growth, but as with so many of the sharper market reversals in recent years , market positioning may prove to be the Achilles heel of this ‘consensus trade.
A very turbulent couple of months for Bitcoin and other crypto-currencies begs the question who are the ‘animal spirits’ that hold Bitcoin? Until the January turbulence, the equity market rally appeared to be bullet proof, but does it make sense to call for an end to the rally, just because it has gone on for so long, and what are the prospects for volatility?
Sugar markets took the wooden spoon in performance terms in 2017, and there is little optimism about prospects for 2018, given an array of headwinds. The versatility of corn in usage terms appears to know no boundaries, and it is now a key part of the US economy, but are there limits to innovations in its production and use.
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