Economics for Investment Q4 - Savings rates are key to growth

Our latest Economics for Investment provides clients with detailed economic and market information on the major economies - US, China, Euro zone, UK and Japan. The Focus section uses our Tricio checklist to analyse whether the US stock market is in a bubble. Most of the items are checked which suggests there is indeed a bubble (though it does not necessarily predict an imminent bust). Nevertheless we believe there is genuine uncertainty over whether AI can generate the profits currently implied in the valuations of the big tech stocks. It may be able to, though we also note that transformative technologies often create bubbles and busts and investors can lose a lot of money. We provide a series of suggestions for how investors can approach the issue, depending on their risk profile.