Finally

Good Morning Ladies and Gentlemen

”Power without abuse loses its charm.”

Paul Valéry

Finally

The US election campaign seems to have lasted forever, but it finally ended this week. On Tuesday, November 5, voters decided that former President Donald Trump would succeed President Joe Biden in the White House. They also determined the future composition of the Senate and, to a large extent, the House of Representatives.

Interest rate cuts in the U.S.

On Thursday, Federal Reserve Chairman Jerome Powell and his team lowered the interest rate by a quarter point, bringing it to a new range of 4.5% to 4.75%. This marked the second step in the interest rate change that began in September of this year and occurred just two days after the presidential election. Most analysts had anticipated this 25 basis point cut, so it was no surprise.

…and in the UK.

The Bank of England’s Monetary Policy Committee also voted to reduce interest rates from 5% to 4.75%, marking the second reduction this year. Bank of England Governor Andrew Bailey reaffirmed his stance on gradual interest rate cuts, stating that borrowing costs should continue to decline as long as the economy develops in line with expectations.

Lower interest rates are good for risk assets

As I mentioned in one of my previous “Stefan’s Weekly” updates, rate cuts, i.e. lower interest rates, are generally favourable for financial markets, particularly for risk assets.

Chaos and order / Paul Valéry

Society fluctuates between chaos and order, and both extremes threaten its existence. Paul Valéry’s unique perspective is that he does not view the “disorder of modernity” as a problem to be fixed. Instead, he sees it as a captivating phenomenon that should be preserved. This appreciation for and celebration of modern disorder was uncommon during Valéry’s time (1871 – 1945), and it remains unusual today, especially in an era with a strong desire for order and stability.

Another last thought before the weekend

With Paul Valéry’s thoughts in mind and confidence that while short-term noise can significantly impact stock market activity, global financial markets ultimately adhere to economic principles over time, I look forward to the exciting times ahead.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li