Latest Blog: Stop the Game! - 01/31/2021
-
-
CIO INSIGHTS
-
CIO INSIGHTS
-
BACK TO CIO INSIGHTS
BACK TO ARTICLES & INSIGHTS HOME
-
-
-
-
Investment Insights are written by Angeles' CIO Michael Rosen
Michael has more than 30 years experience as an institutional portfolio manager, investment strategist, trader and academic.
LAND OF BORAT
Published: 08-20-2015I probably should not confess to enjoying Borat (full title: Borat: Cultural Learnings of America for Make Benefit Glorious Nation of Kazakhstan), 86 minutes of low-brow, sophomoric gags lest I shatter my highly refined, cultured and sophisticated image. So I’ll never admit (in writing) to laughing almost non-stop. It’s the story of a reporter from Kazakhstan traveling across America to discover what makes the country great. I don’t know how the 17 million people of Kazakhstan feel about being portrayed by an imbecile, but Sacha Baron Cohen does a pretty good job of pointing out the fatuousness of Americans.
All this is in way of introduction to what I know about Kazakhstan, most of which comes from that movie. In other words, pretty close to nothing. But while global stock markets fell 1-2% today, the good people of Kazakhstan saw their currency, the tenge, drop 22%, on top of a 4% decline yesterday as the National Bank of Kazakhstan (known widely as the NBK) allowed the tenge to float.
Most (73% to be precise) of Kazakhstan’s exports is oil, whose price, you may have noticed, has been under some pressure. As a consequence, exports are off 34% this year, pushing its current account balance into a deficit. Compounding the problem of a plunging oil price, Kazakhstan’s main trading partner, Russia (one-third of its trade), has seen the ruble fall 47% against the US$ in the past year. And its second-largest trade partner, China (18% of trade), devalued 2% last week. So the combination of a 60% drop in the price of its main export and lost competitiveness against its main trading partner has put the tenge under tremendous pressure. So today, the NBK threw in the towel and allowed the currency to plummet.
We shouldn’t make too much of the travails of a small country (its GDP is on par with Detroit’s). But I don’t think it should be entirely ignored either. I see it as indicative of the strains in the global economic balance as countries try to fight off the forces of weak growth with monetary easing and currency devaluation. And although small, the people of Kazakhstan have a great deal of pride, as Borat said:”Kazakhstan is the greatest country in the world, all other countries are run by little girls.”
PRINT THIS ARTICLERELATED ARTICLES
-
Shades of 2007? 10-17-2014
Nice graphic in today's FT showing the spike in vol and sell-off in risk (Greek bond yields jumped from 5.5% to 9% in ...
READ MORE -
Yasou! 05-29-2015
Let me stipulate up-front: I love Greece. Everything about it: the food, the weather, the history, the music, the ...
READ MORE -
Happy Singles Day! 11-11-2014
11 November is celebrated in the US as Veteran's Day and throughout Europe as Armistice Day, marking the armistice ...
READ MORE
-
-
We build portfolios of best-in-class investment managers across all asset classes. If you would like to be considered for our portfolios, please contact us using our manager inquiries form.
- MANAGER INQUIRIES
-
SUBSCRIBE TO ANGELES' INSIGHTS
Get the latest investment information and stay on top of market trends.
-
CONTACT US
SANTA MONICA
429 SANTA MONICA BLVD,
SUITE 650
SANTA MONICA, CA 90401
310.393.6300
GET DIRECTIONS -
NEW YORK
375 PARK AVENUE,
SUITE 2209
NEW YORK, NY 10152
212.451.9240
GET DIRECTIONS
- SEC/ADV: REQUEST
- © 2021 ANGELES INVESTMENT ADVISORS, LLC & ANGELES WEALTH MANAGEMENT, LLC
- TERMS | PRIVACY
-
COPYRIGHT © 2021
ANGELES INVESTMENT ADVISORS, LLC
ANGELES WEALTH MANAGEMENT, LLC
How Can We Help You?
Institutional InvestorsFully resourced investment office built to manage sophisticated client investment programs
Private WealthPersonalized discretionary portfolio and wealth management services powered by institutional process
Investment ManagementRigorous process and a flexible platform designed to meet client needs
Articles & InsightsLatest insights and perspectives from the Angeles team
Contact UsGet in touch