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Showing posts from March, 2020

5 things to start your day

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Five Things - EuropeFollow UsGet the newsletterWelcome to your morning markets update, delivered every weekday before the European open.Good morning. More signs of stabilization in Europe's virus battle, Trump proposes more big spending and what will the second quarter hold? Here's what's moving markets.Leveling OffThe number of new virus cases in Italy leveled off at a two-week low, providing more evidence that the outbreak in the country is starting to come under control as it prepares to extend lockdowns. Spain reported record deaths, but also said it sees signs of stabilization. In the U.K., the government is scrambling to catch up on testing and the chancellor has removed taxes on medical equipment in a bid to get ventilators and testing kits to front-line staff more quickly. And Dutch scientists have discovered a potential early warning sign for Covid-19 in wastewater, indicating environmental testing may also prove useful.$2 TrillionU.S. President Donald Trump duste…

Brussels Edition: Merkel’s legacy at stake

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Brussels EditionFollow UsGet the newsletterWelcome to the Brussels Edition, Bloomberg's daily briefing on what matters most in the heart of the European Union.After more than 14 years in office, Angela Merkel is in her element as she returns to the frontline of crisis fighting: Polls show a surge in support for her party and broad public approval of her policies. Yet history may judge her less on her custody of Europe's powerhouse economy than on what she does to help the region's weakest members through an unparalleled public-health disaster. Merkel's dilemma is whether she goes all out to help the bloc emerge intact from the pandemic or risk it splintering along national lines. Being at the center of a crisis is a familiar position for the chancellor, only now every country is affected and the threat to the EU's integrity even more palpable.— Alan Crawford and Nikos ChrysolorasWhat's HappeningVirus Update | After a brief respite, bad news came out of Spain ag…

Jeffrey Katzenberg talks Quibi; AMC Theatres CEO raises eyebrows; Frameline postponed

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Ways to Dodge the Wreckage of a Horror Quarter

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Points of ReturnFollow UsGet the newsletterA Hung and Drawn QuarterThe first three months of 2020 have been dreadful. This is mainly because the world has been afflicted by a pandemic that has forced many of us to live in social isolation. But also, a lot of people have lost money.As we survey the wreckage at the end of the quarter, however, we can see ways to have avoided the damage. The default position for long-term asset allocators is 60% in stocks and 40% in bonds. As this chart shows, long U.S. bonds did so well as everyone rushed for safety that the losses for a 60/40 fund were trivial, despite the 20% plunge for the S&P 500:To be precise, a 60/40 fund would have lost only 2.8%, while a very conservative 50/50 allocation would have made 1.4%. If they rebalanced quarterly, they would both now be poised to buy a lot of stocks and sell bonds to do it.If it was a good quarter for conservative asset allocators to show their worth, however, it was an obscenely bad one for aggress…