This site uses cookies to improve your experience and to provide services and advertising. By continuing to browse, you agree to the use of cookies described in our Cookies Policy. You may change your settings at any time but this may impact on the functionality of the site. To learn more see our Cookies Policy.
OK
Dublin: 12 °C Monday 19 August, 2019
Advertisement

The world’s best-performing asset in the last year… Irish government bonds

Anyone who bought Irish bonds second-hand 12 months ago must be feeling pretty smug by now…

Image: Richard Drew/AP

THE BEST PERFORMER in the world over the past year: Irish government bonds, returning 19.0 per cent.

The icing on the cake? The best performer in the entire world over the last six months is… Irish equities, returning 15.3 per cent.

It’s a double feature. Bank of America Merrill Lynch’s global equity strategists led by Michael Hartnett attribute this to the effects of “The 3R’s: Restructuring, Recapitalisation, and Regime change”.

In a note to clients, they write:

The Irish Restructured debt, Recapitalised banks and voted for Regime change (austerity). Indebted countries that fail to implement fiscal contraction will see markets do job for them. Only way to get ahead of severe debt dynamics is “Big Bang”.

Without common sense fiscal policy that allows periphery to refinance debt at reasonable terms, European equities should not be owned, in our opinion.

Markets simply want: global policy coordination; a clear exit plan for Greece; firepower to support peripheral bonds in exchange for credible austerity.

We know what they want; we’ll see what they get here pretty soon.

- Matthew Boesler

  • Share on Facebook
  • Email this article
  •  

Published with permission from:

Business Insider
Business Insider is a business site with strong financial, media and tech focus.

Read next:

COMMENTS (29)