Your humble Spy has gone on a research tour to Shanghai this week and therefore today’s article is but a brief snippet. Yes, dear readers, someone has to take on the task of sampling beers and baijiu in dramatic quantities and Spy has once again stepped up to the, eh, glass? As China’s wealth grows and the tentacles of the global fund industry reach further into the Middle Kingdom, Spy is committed to leaving no bar unvisited and therefore no juicy gossip unheard. From WFOEs to QDII and MRFs to QFII, Spy is drinking his way to local knowledge and a deeper understanding of the landscape.
As Donald Trump raises the stakes in his tariff trade war, one thing is clear, foreign asset and wealth managers consistently tell Spy: The further opening up of China’s financial services market could be a happy result even if their soya beans and aircraft get more expensive. One man’s meat is another man’s poison – clichéd but true.
Spy has encountered more than a few jumpy investors on his travels of late. It seems the recent volatility, which a year ago would have automatically encouraged a “buy the dip” mentality is shifting and rather fast. Nervousness abounds. Spy remembers one fund selector begging for some geopolitics last year because it livened things up. Be careful what you wish for, says Spy.
Correlation is not causation. Repeat after me. One picture doing the rounds that caught Spy’s eye which made him smile is about the Fed Chairs and their respective heights and interest rates. Spy fears there really are fixed income traders out there who might take this nonsense seriously:
Jamie Dimon, JP Morgan’s leonine boss, must have a small smile on his face. His much derided crypto warnings are looking more and more prescient and in his shareholder’s letter he is seeing opportunity everywhere for his bank. The veteran did, however, warn of even more volatility ahead, especially if the Fed lets inflation get out of control. Spy is not too sure who he was warning, the Fed or his clients…
Meanwhile, in Spy’s back yard in Hong Kong, his FSA and Last Word colleagues have been supporting the local Rugby Tens with enthusiasm. Many of the great and good of the local asset and wealth management community joined in the fun supporting a good cause and finding the occasional beer:
Finally, Spy’s photographers have spotted a new campaign in Hong Kong from Fidelity. Using a tree as a growth metaphor in asset management has never been done before…or has it?
Until next week, when Spy is back from China…
