Macroeconomic and Geopolitical Analysis - Example
Information. Let's say the Fed is raising interest Rates to fight inflation, while a geopolitical conflict disrupts oil supply and a strong USD hurts exports.
- U.S. tech stocks may fall (valuation hit by higher Rates).
- Commodities like oil and gold rise (conflict + inflation hedge).
- Emerging markets may struggle (debt + strong dollar).
- Defense, energy, and utilities may outperform.
- Holding cash or short-term bonds becomes more attractive.
What impacts do these factors have?
Factor Impacts
| Factor | Risk Assets (Stocks, Crypto) | Safe Assets (Bonds, Gold) | Real Assets (REITs, Commodities) |
|---|---|---|---|
| Rates ↑ | valuation pressure | bond prices fall | Mixed |
| Inflation ↑ | Mixed | fixed income loses value | inflation hedge |
| Dollar ↑ | exports & EMs suffer | capital to USD assets | commodity prices fall |
| War / Sanctions | volatility ↑ | flight to safe havens | oil & defense benefit |
Summary: Your scenario favors Real Assets (Energy, REITs). Risk Assets face headwinds.
Scores — Risk: -3, Safe: 0, Real: 1
Summary Table: Factor Impacts
| Factor | Risk Assets (Stocks, Crypto) | Safe Assets (Bonds, Gold) | Real Assets (REITs, Commodities) |
|---|---|---|---|
| Rates ↑ | ↓ (valuation pressure) | ↓ (bond prices fall) | Mixed (depends on inflation) |
| Inflation ↑ | Mixed | ↓ | ↑ (hedge) |
| Dollar ↑ | ↓ (exports, EMs) | ↑ (U.S. assets attract capital) | ↓ (commodity prices fall) |
| War/Sanctions | ↓ (volatility ↑) | ↑ (safe havens) | ↑ (oil, defense) |
| Stimulus ↑ | ↑ (boost to economy) | ↓ (possible inflation) | ↑ (infrastructure, real estate) |