Investors Face Challenges in U.S., Europe Eco Data

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Oct. 31 (Bloomberg) -- Michael Mullaney, VP & chief investment officer at Fiduciary Trust Company and Bloomberg Contributing Editor David Blanchflower discuss the challenge to investors of finding economic growth in the United States and Europe. They speak on Bloomberg Television’s “In The Loop.”

Based on?

We think the economy is improving in the united states and also in europe and across the world.

As such, valuations are better outside the u.s. right now.

Returns have not been quite as strong.

We would rather dedicate our assets to those spaces, rather than domestic.

Danny, you were showing me a great chart of inflation in europe.

What is the bigger picture?

I do not really agree with what he has said.

We have seen data for the u.s., consumer confidence, just collapsed.

Data from germany today is weakening, and the inflation numbers from europe today are scary.

We are talking about a drop in four months from 1.6 to .7%. germany and confidence falls today.

We are heading rapidly towards deflation.

The u.s. and europe is slowing.

I do not know why michael think that it is not.

In some sense, the next move from central banks might well be to boost qe.

He is right that that would be positive for asset prices, but the economy is slowing.

Michael, getting to this idea of deflation, you have four months of inflation reaching alarmingly low levels.

What does that change, if anything, to your premise?

If you think about deflation, the lack of inflation, it is positive for price-earnings multiples.

We should begin to get some expansion.

As far as economic activity in europe, what i am looking at now is the purchasing managers indices coming from the manufactured and nonmanufacturing markets, both above 50, the demarcation line between expansion and contraction.

There seems to be a rebound in the industrial european space, which is what is happening in the u.s. as well.

There has been a bit of slowing in the recent numbers, and again and increase in the unemployment rate in europe.

If anything, it looks like another turn down.

Danny, one of the pairings that moved yesterday, post-fed was euro-dollar.

Everything else was silent for about a half-hour after the decision.

Euro-dollar still trading at 1.36. that had a guest yesterday saying that parity would be great for the economy, great for germany, because their exports can be stronger.

What is the right level for euro-dollar?

The logic in europe is you have overly tight fiscal and monetary policy.

The central bank is not intervening, whereas the u.s. central bank is.

So you have a stronger euro and you should see.

1.37. europe and being killed by this.

It is hard to see where they will go because of the structures.

The span is sent -- spanish central bank governor has been voted against things that have been in their interest.

If the euro area and ecb do not respond, then the fed should respond.

Many people here are concerned about inflation if qe keeps going.

We had dated yesterday showing the u.s. is falling.

1.2%. all these people have been telling us about inflation are wrong.

The fed really needs to worry about this.

U.s. inflation is too low and it needs to do something to increase inflation.

We are way below the target of 2. i love that you have a point of view and you defend it.

Thank you for the time.

Michael mullaney, thank you for the time.

We are back in two minutes with more on t-mobile.

Maybe being crazy like a fox, or

This text has been automatically generated. It may not be 100% accurate.


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