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Why crowdfunding threatens traditional bank lending
June 2004
by Chris Leahy, Felix Salmon, Mark Brown, Julian Evans,, Peter Koh, Julie Dalla-Costa,
Bond markets - Few places to hide Asia - Panic sellers ignore fundamentals Russia - Local causes of a vicious correction Fund managers - Investors turn defensive Equity market - Earnings might outstrip rate rises Latin America - A region immune to volatility
Bond marketsFew places to hide
Graham Neilson, ABN Amro's global head of credit strategy, is emphatic. "This isn't 1997 again, and it isn't 2001 again. It is 1993/94, and the comparison is not lost on the market," he says. "The comment then was that rates going up presented an opportunity to buy. That was bollocks the first time around and it will be again."
The upshot of interest rate rises in 1994, as Neilson points out, was one of the biggest bond market unwinds ever. "Bond yields went from 5% to 9% and people were carried out," he says. "It challenged the assumption that you should be a buyer in a dip."
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