Investment Office

Selecting relevant market observations

Investment Thoughts
Macro Observations
Capital Markets
Markets in History
Beyond Finance
Quotes on the Fly
Chart Gallery
Coffee Chronicles
Asset Management
Asset Allocation
Asset Class Returns
Market Characteristics
Pension Funds
Pension Funds Switzerland
Public Pension Funds
Corporate Pension Funds
Industry-Wide Funds
Multi-Employer Funds
Investment Advisors
User Manual
Family Offices
Wealth Managers
Independent Advisors
Family Offices
Private Banks



Cool Charts










Latest Observations, December 2018




The Coffee Chronicles

"Once again, these are just facts, and facts are never powerful enough vis-à-vis theories about war and what we want to believe."
Stephen Kotkins, Dartmouth, 1917 Centennial Series: War, Revolution, Socialism, War. October 2017


Does the Yield Curve Really Forecast Recession ?
It's well known that in the United States recessions are often preceded by an inversion of the yield curve. Is there any economic rationale for this?
David Andolfatto, Andrew Spewak, Federal Reserve Bank of St. Louis, November 30th, 2018


Labor Force Participation Rates, 25-54 year old
A Strong Economy – But We Can Aim Higher. Remarks by MARY C. DALY President and CEO Federal Reserve Bank of San Francisco To the Regional Economic Development for Eastern Idaho (REDI), November 12, 2018

The financial and business cycles in the United States
"Put differently, calendar time might not be the best way to compare cycles over time."

Andrew Filardo, Marco Lombardi and Marek Raczko, BIS Working Papers, Measuring Financial Cycle Time, 7 November 2018


Quote on
the Fly

"So when the majority of volume in the market is traded by people who do not care about fundamentals, what is that fundamentally mean for the stock market ? It is a pretty scary thought, right ?"

Brad Katsuyama, The Stock Market had become an Illusion, March 26, 2016


The Coffee Chronicles


"I have several theories about things and stuff.

My theory about evolution: Darwin was adopted!"

Steven Wright, Wicker Chairs and Gravity, 1990


The history (and future) of inflation
It may not feel like it, but we live in inflationary times relative to long-term history.
Jim Reid, Craig Nicol, Nick Burns, Sahil Mahtani, Deutsche Bank, September 19, 2018



Do stocks outperform Treasury bills?

"All of the wealth creation can be attributed to the thousand top-performing stocks, while the remaining 96 percent of stocks collectively matched one-month T-bills."

Prof. Hendrik Bessembinder, Francis J. and Mary B. Labriola, Arizona State University, W. P. Carey School of Business, May 2018

The ECB’s QE End Is Bullish
Closing the chapter on QE is bullish—not bearish—for investors, in our view.
Fisher Investments MarketMinder, November 8, 2018


Why French Investors are Truly les Misérables
"Over a 100-year period, French investors would have lost over 90% of their money after inflation no matter how they invested their money."
Dr. Brian Taylor, Global Financial Data, 17 April 2017


Can banks individually create money out of nothing? — The theories and the empirical evidence
This study establishes for the first time empirically that banks individually create money out of nothing. The money supply is created as ‘fairy dust’ produced by the banks individually, "out of thin air".
Richard A. Werner, International Review of Financial Analysis, December 2014


What do rising rates mean for international investments?
Brian Levitt, OFI Global Asset Management, October 11, 2018 

Do we still believe interest rates will remain low for long? 
Brian Levitt, OFI Global Asset Management, October 11, 2018


Notes on The Bitcoin Standard
"Bitcoin, as designed, is deflationary."
Michael Kendall, Man on the Margin, July 16, 2018


American Default

The Untold Story of FDR, the Supreme Court, and the Battle over Gold.
Sebastian Edwards, Princeton University Press, May 2018


The Coffee Chronicles

“In the depth of your ignorance, what is it that you want?"


Orson Welles getting frustrated with some studio personnel as he attempts to narrate some badly written commercials that he clearly finds quite annoying. Obscure Audio 2: Orson Welles Outtakes - Frozen Peas, 1970


Asian currencies vs. Yuan, rebased at 100 on 31.12.2013

Charles Gave, Guerre Commerciale Chine/ Etats-Unis, Institut des Libertés, October 7 2018


Why Financial Institutions Struggle to Modernize…and Why They Have to
Prattle is pleased to publish this interview with Zac Sheffer, CEO and Founder of Elsen, focusing on the modernization of financial institutions and the future of data in finance.

Prattle, February 7, 2018 

Quote on
the Fly

Shadow Risk in Passive Investing
"The shift from active to passive investing is a significant amplifier of future volatility."


Christopher Cole, Founder and CIO of Artemis Capital, Volatility and the Alchemy of Risk, Reflexivity in the Shadows of Black Monday 1987, October 2017





Pension Funds Switzerland 2018
For institutional investors only


Public Pension Funds


Corporate Pension Funds


Industry-Wide Pension Funds


Multi-Employer Pension Funds



Seismic waves
Seismic waves are waves of energy that travel through the Earth's layers. What would be the equivalent in today's markets?
Investment Office, September 2018


Bloomberg: Prattle Analysis Shows Men Speak 92% of Time on Earnings Calls
Prattle, September 18, 2018




A Tangled Tree: A Radical New History of Life

"My favorite part of the book is the section, starting on p.244, on bacteria that are resistant to antibiotics that have not yet been invented."
Greg Van Kipnis, Daily Speculations, September 16, 2018


Pension asset allocation
Aggregate P7 asset allocation from 1998 to 2017


Willis Towers Watson, Global Pension Assets Study 2018, February 2018



The Count of Monte Cristo
The Count of Monte Cristo has numerous financial data and speculations in it that shows that during the Napoleonic years there was active speculations.
Victor Niederhoffer, Daily Speculations, September 16, 2018



The Callan Periodic Table of Investment Returns
Annual Returns for Key Indices Ranked in Order of Performance (1998–2017)

Callan Associates Inc., 2018



The Coffee Chronicles

“But it was really difficult to explain our needs and for them to get their head around what we are doing, or even have an interest in doing something in low volume. So that meant we had to develop it ourselves.”

Christian Van Koenigsegg, The Drive, November 2016



Asset Class Returns in Swiss Francs (2008 - 2017)

Dr. Alex Hinder, Hinder Asset Management, 2018




The Oxymoron of World Trade
Oxymorons are powerful combinations of contradictory meanings. We encounter oxymorons in every human form of expression attempting a description of reality, whether it be in works of tragedy (“fearful bravery” in Shakespeare’s Julius Caesar), in our daily lives (work that is “almost done”), or even in the projected future of human societies (“artificial intelligence”).
Didier Darcet, Gavekal Intelligence Software, The Quant Corner, September 2018


Information in the Yield Curve about Future Recessions
"Furthermore, when interpreting the yield curve evidence, one should keep in mind the adage “correlation is not causation.”
Michael D. Bauer and Thomas M. Mertens, Federal Reserve Bank of San Francisco, Economic Letter, August 27, 2018



Chart of the Month: Gold in Turkish Lira (TRY)

1875 CIO Office, Current Views, 1875 Finance, August 2018


General Electric: The Fallen Giant
"General Electric’s decline has been steady during the 21st century. In 2000, GE’s market cap was over $500 billion and as recently as 2005, General Electric was the largest company in the world. Since then, GE has lost over $400 billion in market cap, and today, GE doesn’t even make the top 50 in the world."
Dr. Brian Taylor, Global Financial Data, 22 June 2018


Consumers Response More to negative News than Positive Info
"The laboratory provides insight into how cognitively taxing it can become for people exposed to changes in the economic landscape to acquire and process information."
Antonella Tutino, Federal Reserve Bank of Dallas, Economic Letter, Volume 13, Number 7, May 2018



on the Fly


“It is better for the Bank of Japan not to attract attention and remain as quiet as the forest for a rural shrine.”
Hisato Ichimada, Governor of the Bank of Japan, 1946-1954



The Coffee Chronicles

"An era does not just create technology. Technology creates the era."

W. Brian Arthur, The Nature of Technology, 2009


Neurosis Is Killing Your Returns!
Short-term volatility is the psychological price investors pay to achieve stocks’ high historical long-term returns.
Michael Hanson, Fisher Investments MarketMinder, 14/06/2018


Memory Sticks!
Didier Darcet, Gavekal Intelligence Software, The Quant Corner, June 2018





on the Fly


“In a dataset of 10 developed countries for the period 1890-2000, we show that diversification benefits decline as financial markets open up to international capital flows. Diversification benefits disappear as investors chase them." Dennis Quinn and Hans-joachim Voth, The Diversification Fata Morgana: Capital Account Openness and the Fall and Rise of Stock Market Correlations, 1890-2000 , 2015



The Coffee Chronicles

"Villager: How can we find a samurai we can pay with only rice?

Gisaku: Find hungry samurai."

Akira Kurosawa, The Seven Samurai, 1954


A monopoly on liquidity
"The board game Monopoly® was originally invented by Elizabeth Magie, under the name “The Landlord’s Game”, as a means of demonstrating the evils of rentier capitalism. Originally, there were two sets of rules — essentially, socialism (where the rewards for development were shared by all) and capitalism (where the rewards accrue to the monopolist, who crushes all opponents) — the purpose being to show the moral superiority of the first set."
Erik Britton, Fathom Consulting, 16 March 2018


The Russian Stock Market Before the Revolution
"Russian stocks advanced more in price than American stocks between 1864 and 1914, but American companies paid larger dividends. Price and dividends offset each other and during that 45-year period, the two stock markets provided approximately equal returns."

Dr. Brian Taylor, Global Financial Data, 21 March 2018



Understanding inflation and its impact on your portfolio
Thanks to globalization, technological advances, monetary policy and demographic trends, inflation in most developed economies has been moderate in recent decades. However, a continuation of this benign inflationary environment is by no means certain, as evidenced by a recent White Paper released by Mercer Investments Research highlighting the growing inflationary pressure.

By Gil Platteau, Country Head Switzerland, Mercer Investments.  More...



Lonely Bytes – Cryptocurrencies & The Future of Money:
A New Technology Solution Desperately Seeking A Problem?
Michael Howell, CrossBorder Capital, March 13, 2018



The Coffee Chronicles

"And the real problem is, in my opinion, that as we move, from the local community to the State, from the State to the Federal Government, it becomes increasingly difficult for us to control the mechanism we have established, and that mechanism tends to control us." Milton Friedman, in 1978, Free To Choose Network, May 22, 2012


The Questions for the Coming Year
"As Charles has shown over the years, this is the best combination for equity markets, as tight fiscal policy and loose money almost invariably leads to far higher P/E ratios. Alas, the opposite is true for the reverse: loose fiscal policy and tight money typically trigger a de-rating of equity markets. And this is the policy mix we seem to be heading towards."
Louis-Vincent Gave, Gavekal Research, December 15, 2017




The Coffee Chronicles

"A couple of geeks who sketched out some software could destroy Sears Roebuck?"
"60 Minutes" episode from 1999, "Jeff Bezos & Amazon - An Inside Look". The late reporter Bob Simon asked (sneering) an analyst about Amazon highflying stock.


Market Capitalization Amazon vs. Sears
1999 vs. 2017

Scott Galloway, L2 Inc. December 2017





on the Fly



“What we said for years, going back to the beginning of so called Quantitative Easing in America was that it was not Quantitative Easing, it was Quantitative Diseasing (...) and that Quantitative Easing as it is called is always contractionary and deflationary, and that we’re having a bull market and economic expansion DESPITE it, not BECAUSE of it."

Ken Fisher, Fisher Investment Capital Markets Update: Summer 2017



Passive-aggressive Bureaucracies

"Means become ends and ends become means. Consequently, the original goals of such organizations are now considered to be nothing more than obstacles on the way to realizing new aims (...) the collective perpetuates its existence, regardless of whether it has any role left and how well it functions."
Sam Vaknin, Lidija Rangelovska, Malignant Self-love: Narcissism Revisited, 10th edition, 2015


Bad Things That Didn't Happen in 2017
A look at the false fears that weren’t
Fisher Investments MarketMinder, December 28, 2017


Retail's Anti-Christ
Market Value Today vs. 2006

Scott Galloway, NYU, December 2017


Changes at the Top

The Five Largest Companies: Now vs. 2006

Scott Galloway, NYU, December 2017



Pension Funds Switzerland 2018

 For institutional investors only


Pension Funds Switzerland 2017

 For institutional investors only


Pension Funds Switzerland 2016

 For institutional investors only



Pension Funds Guide
Switzerland 2015

 For institutional investors only

pdf Version


Asset Management Switzerland 2015

 For professional investors only









Bubbles and Crashes

Business Cycles
Central Banks




Creative Destruction
Credit Crunch


Current Account


Financial Crisis
Fiscal Policy


Gloom and Doom

Government Debt

Historical Patterns

Household Debt

Interest Rates


Market Timing


Monetary Policy

Real Estate


Sovereign Bonds
Systemic Risk


Tail Risk


Tipping Point
Trade Balance