Epsilon Theory Professional
In The Flow
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Why does it matter whether you think profit margin expansion has been driven more by globalization (Bridgewater) or financialization (Epsilon Theory)?
Because central banks can continue to drive financialization and earnings margin expansion even as globalization collapses.
Whether you’re a trader or a portfolio manager or a financial advisor or an allocator, ET Pro can help you identify both the inflection points and the trajectory of the market Zeitgeist – particularly the question that any long-term portfolio owner MUST get roughly right in order to succeed: are we in an inflationary or deflationary world, and how quickly (if at all) and in what ways is that world changing?
You can make a lot of money collecting Golden Age comics. The Silver Age, though? Meh. The story arcs and narratives are a joke. The art is so-so at best. The publishers are just squeezing the installed base, and the creators are just mailing it in. They’re old, but so what?
Same with the Silver Age of Central Bankers. It’s hard to make money, particularly in Emerging Markets, when it’s every man for himself among DM central banks.
Narrative Monitors
ET Pro Inflation Monitor
We track the prevalence and attention of inflation topics in financial and broadly circulated news sources, including their attachment to narratives around financial markets.
Updated through April 30, 2019. Updated monthly.
ET Central Bank Omnipotence Monitor
We track the prevalence and attention of credibility attached by a wide variety of news sources to central banks and their influence on participants in financial markets.
Updated through April 30, 2019. Updated monthly.
ET Trade and Tariffs Monitor
We track the attention paid to and sentiment of a various trade and tariff-related topics in a range of news sources, especially with respect to their attachment to financial market narratives.
Updated through April 30, 2019. Updated monthly.
ET US Fiscal Policy Monitor
We track the strength and consistency of narratives about US fiscal policy, including budgets, tax policy and debt.
Updated through April 30, 2019. Updated monthly.
ET Credit Cycle Monitor
We track the strength of narratives about the credit cycle in general, plus lending, liquidity and other trends in credit markets.
Updated through April 30, 2019. Updated monthly.
In Focus
ET In Focus reports are single-issue topical analyses. They cover investment and portfolio construction topics, issues relating to the businesses of investment management and wealth management, and narrow analyses of the narrative structure and trends on specific issues, companies, sectors, countries or financial markets.
In this ET Pro In Focus note, we explore the narrative structure of ESG and SRI investing. Our question: is it finally part of the Zeitgeist, or a trend that will continue to come and go?
For fund managers and asset management executives, the fundraising question is often the most important and most inscrutable. Understanding how narratives and career risk factors interact with decision-making processes is critically important.
We introduce a new narrative measure and then put major global equity markets under the narrative microscope in Q1 2019.