Aug 3, 2023Liked by Callum Thomas

Thanks Callum. It's very valuable to have a systematic review like this for various asset classes.

A couple of comments if I may, while acknowledging that they may be difficult to incorporate into your frame work:

1) Gold is an obvious omission from some charts/ tables given it's well accepted diversification role in a portfolio.

2) While I tend to agree that US Treasuries will have their day once something serious breaks, there is a risk that pro-cyclical fiscal largess by US Govt, the BoJ changes to YCC and US sanctions on Russian FX reserves are shifting the longer term role of US Treasuries. I don't know how this can be incorporated into a broad asset allocation assessment other than to acknowledge the seeming significance of these moves and the risks they pose to the traditional valuation metrics.

thanks and regards


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re 2): forgot to mention the Fed's QT program (if they are serious and able).

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Thanks Bruce, I will think about how to include gold in the monthly... but I do cover it when things get interesting in the weekly e.g. https://topdowncharts.substack.com/p/weekly-insights-edition-116

For bonds, interesting points, I will ponder how to quantitatively include those, but indeed to factor them in, especially BOJ policy. But in general agree that the outlook for bonds is less than clear-cut as I still have a couple of indicators flaggin potential upside risk in yields..

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