Beyond Bulls & Bears

Self-Driving Vehicles: Evaluating the Possible Impacts

The race to develop truly autonomous vehicles continues to pick up speed. Not only are passenger cars in the race, but also trucks and buses. Autonomous vehicle technology truly holds the potential to reshape many industries, in ways we probably haven’t even thought of yet. Recently, Franklin Templeton Investments assembled a panel of industry experts to talk about where they see the future of self-driving technology, and how long they think it will take to get to the finish line.

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Fixed Income

Why Australia May Not Join the Rate-Tightening Party

“We don’t think the RBA is likely to raise rates in the next 12-18 months. There is a heavy load on the shoulders of Australian households. Australia’s economy is benefiting from global growth, particularly in China, but that growth would have to be quite significant to reduce household debt or improve wage growth. If these issues don’t improve in the next year or so, we believe the RBA’s next course of action could be a rate cut.” – Chris Siniakov and Andrew Canobi, Australia Fixed Income team

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Alternatives

A Story of Risk Management, and Flying to the Moon

Risk management is a key part of many endeavors, from space travel to investment management. In either case, achieving one’s goals requires awareness of what could go wrong, as well as careful attention to details in often-changing conditions to ensure the smoothest possible journey. Tilak Lal, vice president, Performance Analysis & Investment Risk at Franklin Templeton Investments, describes what risk is within the investment space, and how risk management is essential to success.

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Fixed Income

The Fed’s Long Unwinding Road

“The multi-year massive expansion of the Fed’s balance sheet has had a recognized powerful effect on asset markets—lowering yields and flattening the yield curve. Yet investors now seem to expect that the reverse process will have little impact, if any. We disagree.” - Michael Hasenstab, Templeton Global Macro

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Perspectives

Preparing for a Possible Post-LIBOR World

“We believe a change from LIBOR to an alternative benchmark would be significant. Global lenders use LIBOR to set interest rates for a variety of financial products, including interest-rate swaps, student loans, mortgages, collateralized loan obligations (CLOs) and floating-rate loans. A change would require amendments to contracts and credit agreements, underlying trillions of dollars in global assets.” – Franklin Templeton Fixed Income Group’s Mark Boyadjian and Reema Agarwal

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Fixed Income

In the Know: Trump’s Fed Chair Pick Seen as Market Positive

“The markets should take some comfort in Powell, as he is a current Fed governor and more or less represents the current state of affairs, business as usual. He has worked alongside Yellen since 2012, and they are philosophically alike (dovish bent).” Christopher Molumphy, Franklin Templeton Fixed Income Group

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Education

Retirement Income Planning Takes a Flexible Approach

Dennis Heinke, vice president of North America Product Strategy at Franklin Templeton Investments, discusses the challenge of generating retirement income and some strategies that can help alleviate some of the anxiety surrounding it.

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Alternatives

Science Fiction to Science Fact: The Rise of the Machines

“Exponential growth in computer processing speeds, advances in big data, open-source software and cloud computing have all converged over the last decade to move AI from the realm of science fiction to science fact.” - Mat Gulley and Ryan Biggs

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Education

Social Security Benefits Set to Increase, but Don’t Get Too Excited

Gail Buckner, CFP®, offers some useful information about a 2018 Social Security benefits bump, and outlines a new Congressional bill that may change the benefits equation down the road.

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Equity

Why Abe’s Victory Could Help Lift Japanese Stocks

“In our view, Abe’s victory could lead to four more years of pro-growth policies and the possibility of a second term for the very ultra-dovish Bank of Japan Governor Haruhiko Kuroda.” – Templeton Global Equity Group’s Cindy Sweeting and Alan Chua

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Multi-Asset

A Selective Look at Corporate Credit

“In line with a positive assessment of economic fundamentals, we view credit conditions as favorable. Interest rates remain low, corporate balance sheets generally remain strong and debt-service costs appear manageable. Markets still appear receptive to debt offerings.” – Ed Perks, Franklin Templeton Multi-Asset Solutions

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Fixed Income

Global Economic Perspective: October

In this month’s Global Economic Perspective, Franklin Templeton Fixed Income Group discusses the state of the US economy and monetary policy implications, the fallout from the German elections and impact of the Catalonia crisis in Spain.