HOUSE_OVERSIGHT_026696.jpg
1.22 MB
Extraction Summary
1
People
6
Organizations
7
Locations
2
Events
0
Relationships
3
Quotes
Document Information
Type:
Financial report / economic analysis (page 16)
File Size:
1.22 MB
Summary
This document is page 16 of a financial report analyzing the economic outlook for the US market around early 2017. It details the attractiveness of US equity and real estate markets to sovereign investors due to rising interest rates, currency strength, and the incoming Trump administration's tax policies. It includes a chart comparing 10-year government bond yields across the US, UK, Germany, and Japan. While stamped 'HOUSE_OVERSIGHT', the page itself contains no direct mention of Jeffrey Epstein; it appears to be general economic research likely included in a larger production of documents.
People (1)
| Name | Role | Context |
|---|---|---|
| Donald Trump | US President-elect/President |
Mentioned in relation to a 'pro-business' corporate tax regime following him taking office in January 2017.
|
Organizations (6)
| Name | Type | Context |
|---|---|---|
| US Treasury Resource Center |
Source for bond yield data.
|
|
| Bank of England |
Source for bond yield data.
|
|
| Bundesbank |
Source for bond yield data.
|
|
| Ministry of Finance (Japan) |
Source for bond yield data.
|
|
| XE |
Source for currency data.
|
|
| House Oversight Committee |
Implied by Bates stamp 'HOUSE_OVERSIGHT'.
|
Timeline (2 events)
Locations (7)
| Location | Context |
|---|---|
|
Primary focus of economic analysis (returns, protection, real estate, infrastructure).
|
|
|
Region for asset allocation increases.
|
|
|
Region where sovereigns noted concerns.
|
|
|
Region where sovereigns noted concerns.
|
|
|
Comparison for bond yields.
|
|
|
Comparison for bond yields.
|
|
|
Comparison for bond yields.
|
Key Quotes (3)
"There is also market confidence of a 'pro-business' corporate tax regime following Trump taking office in January 2017"Source
HOUSE_OVERSIGHT_026696.jpg
Quote #1
"Most notable, however, is the growing optimism around the potential for new infrastructure deals in the US following political campaigning suggesting an investment opportunity of US$1 trillion."Source
HOUSE_OVERSIGHT_026696.jpg
Quote #2
"Many respondents were concerned about growing protectionism in the US"Source
HOUSE_OVERSIGHT_026696.jpg
Quote #3
Full Extracted Text
Complete text extracted from the document (2,244 characters)
Growth of the US for both returns and protection
The attractiveness of the US has been driven by interest rate rises (with expectations for further raises this year) and bond yields lagging in other developed markets (figure 8). There is also market confidence of a 'pro-business' corporate tax regime following Trump taking office in January 2017, causing sovereigns to note the growth potential of US equity markets (with 40% of sovereigns expecting to increase North American allocations in 2017), as other developed market stocks remain flat. Currency strength underlies this optimism (USD up 3% against EUR and 20% against GBP in 2016¹), with some sovereigns deliberately targeting dollar exposure through their international investments. Liability sovereigns noted the dual benefit of the open currency position, both eliminating hedging costs and generating additional returns relative to home market currency.
The attractiveness of the US has been driven by interest rate rises (with expectations for further raises this year) and bond yields lagging in other developed markets (figure 8). There is also market confidence of a 'pro-business' corporate tax regime following Trump taking office in January 2017, causing sovereigns to note the growth potential of US equity markets (with 40% of sovereigns expecting to increase North American allocations in 2017), as other developed market stocks remain flat. Currency strength underlies this optimism (USD up 3% against EUR and 20% against GBP in 2016¹), with some sovereigns deliberately targeting dollar exposure through their international investments. Liability sovereigns noted the dual benefit of the open currency position, both eliminating hedging costs and generating additional returns relative to home market currency.
In our 2015 sovereign study, we highlighted the attractiveness of real estate investments in developed markets. Under FIRPTA (Foreign Investment in Real Property Tax Act), sovereign appetite for real estate investment in the US has further grown. Most notable, however, is the growing optimism around the potential for new infrastructure deals in the US following political campaigning suggesting an investment opportunity of US$1 trillion.
Despite positivity, sovereigns in Europe and Asia noted that successful US real estate investments gave no guarantee of similar opportunities within infrastructure. Many respondents were concerned about growing protectionism in the US, questioning if it might both limit access to infrastructure and real estate investments for foreign sovereigns and would have long-term economic implications as foreign relations are strained.
¹Source: XE currency data. Data from 01 January 2016-01 January 2017.
[Side Note]
Currency strength underlies optimism for the US.
Currency strength underlies optimism for the US.
[Chart]
Fig 8. 10-year government bond yields
Fig 8. 10-year government bond yields
US
2.5
2.5
UK
1.3
1.3
Germany
0.2
0.2
Japan
0.0
0.0
Source: US - US Treasury Resource Center, UK - Bank of England Data, Germany - Bundesbank Statistics, Japan - Ministry of Finance Interest Rate Index. Data taken as daily average yield on 30 December 2016.
16
HOUSE_OVERSIGHT_026696
Discussion 0
No comments yet
Be the first to share your thoughts on this epstein document