STUART THEOBALD: Investors should keep a close eye on the fundamentals in 2022
My sense is that investors are less certain than it appears
It is hard not to have a sense of apprehension going into 2022. Interest rates in SA are trending up from a 50-year low as we enter an upward cycle. Inflation in big markets is at levels not seen for 30 years. Central banks in the biggest economies are beginning to unwind unprecedented levels of liquidity as they turn towards dealing with inflation. There is no playbook for this phase as we’ve never had central bank balance sheets as swollen with printed money as we do now.
The unwind is happening in a global economy that has had more than a fair share of external shocks thanks mostly to Covid-19 (though Chinese property earthquakes can be big contributors too). Equity markets are at or near historic levels implying that investors are confident that company profitability is going to be strong. Business confidence is positive in all big markets. This is the right kind of environment to be attempting to wind back an experiment in flooding the world with money to fight off a Cov...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.