{"id":7197,"date":"2020-06-19T13:34:56","date_gmt":"2020-06-19T11:34:56","guid":{"rendered":"https:\/\/clusterfamilyoffice.com\/?p=7197"},"modified":"2020-06-19T13:34:56","modified_gmt":"2020-06-19T11:34:56","slug":"peligro-navegar-viento-los-bancos-centrales","status":"publish","type":"post","link":"https:\/\/clusterfamilyoffice.com\/en\/peligro-navegar-viento-los-bancos-centrales\/","title":{"rendered":"The danger of sailing against the wind of central banks."},"content":{"rendered":"

At this point in the pandemic and with the markets having recovered so rapidly since the lows of 23 March, we would like to offer some thoughts for investors from the latest report from Oaktree Capital<\/a>. Let us start by listing some of the obvious reasons why investors should not be so optimistic about market prices. For example, the risk of virulent resurgence posed by the fact that economic activity has resumed in most Western countries. It is true that not having resumed economic activity would generate more economic and social crisis, but the health crisis that may be generated by strong resurgences could certainly be a drag on the share prices of many companies.<\/p>\n

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Another reason for pessimism is that the slow recovery of consumption and social interaction habits, so necessary for free economic exchange, may extinguish many businesses and enterprises that simply will not make it alive to the full reopening of economies when it occurs.<\/p>\n

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Some scientists also warn that a fully effective and safe vaccine may not be available until well into 2021, which would slow down the return to economic normality more than expected.<\/p>\n

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Other economists warn of the large number of private corporate bankruptcies and the irreparable damage that can be done to public accounts by the policy of almost infinite monetary risk to avoid collapse. Not to mention the uncertain changes in business models in sectors such as travel, retail sales, offices or any activity that has traditionally been carried out by concentrating many people in closed environments or high population density.<\/p>\n

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For all these reasons and many more, there is no shortage of reasons for those who prefer to keep their money where it is and see the glass of this pandemic as half empty, even though prices are already near record highs. Perhaps some of them got out of the market in the middle of the fall and are still losing money in 2020. But as we said recently, whoever is still in the negative today could have done better.<\/a>. So let us look at some of the reasons why it is very dangerous, or at least unprofitable, to underestimate the power of the tailwind of coordinated monetary policies of all the world's central banks.<\/p>\n

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