Rathbones Review Winter 2016

What a year it has been for political surprises. It is now just over four months since the EU referendum result shook the country and financial markets alike.

Rathbones Review Winter 2016 front cover PDF

The stock market recovered quickly, helped by the fact that many UK companies actually do more business abroad in dollars than in sterling. Sterling itself continues to be weak, reflecting concerns about the outlook for the UK after Brexit.

As I write the result of the US presidential election is unknown, although the die will be cast by the time you read this. Wall Street tends to prefer Republican candidates, yet it often performs better under Democrats. However, the presidency has historically had little impact on investors. This may not be true from 2017 to 2021.

Donald Trump has explicitly committed to protectionist trade policies, including a 45% tariff on Chinese imports. In our view, this would be a disaster for world trade and therefore economic growth. Our lead article discusses protectionism in more detail. We believe politicians should be making the case for free trade, rather than letting populist rhetoric set the agenda. Hillary Clinton has also made protectionist noises: let us hope that these are only for campaigning expediency.

Elsewhere in this edition, we look at an eclectic range of subjects, from Eleanor Rathbone, Cathy Come Home and the changing face of the City of London to how technology is transforming how we live (‘The A to Z of sharing’) and generate and store energy (‘Bring me sunshine’).

I hope you enjoy this edition of Rathbones Review and, as ever, we appreciate any feedback you might have.

Paul Chavasse, Head of investment management, Rathbones

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