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The Survivability of the Euro, Part I: Reform, Relevance and Robustness

Invesco’s Future of Europe series aims to address some of the most pressing questions surrounding the euro, the eurozone (EZ) and the European Union (EU), whilst also examining Europe’s troubled past, uncertain present and possible future. The second paper in the series, The Survivability of the Euro, comprises three parts, of which Reform, Relevance and Robustness is the first. In this paper we analyse the vital issue of imbalances between member states and explore the conflicts that they generate.

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Is it time to worry about a liquidity crisis?

Large-scale asset purchases by major central banks has added to the abundance of liquidity in markets, however the tide is now turning in the opposite direction. As balance sheet normalization accelerates, it seems likely that liquidity issues could accelerate too.

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Protectionism rears its ugly head again

With the US applying aluminum and steel tariffs to Canada, Mexico and the European Union, and exploring tariffs of up to 25% on imported cars, free trade is being threatened.

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They say they want a revolution

The way market participants are investing is changing rapidly for many – on one side we see an increasing need for reduced costs, and on the other, value added is becoming ever more important.

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Cyclical, structural, influential

In a yield-starved, low-growth, low inflation world, emerging markets with higher real growth, inflation and the associated underlying economic vigour may offer an attractive proposition for developed market investors.

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Coping with chaos

Many investment approaches used for portfolio construction are based on efficient frontiers, notions of stable correlations and normal distribution assumptions. But how will they cope once chaos enters the market?

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Balance sheet normalisation for US central bank

The balance sheet of the US Federal Reserve has expanded strongly in recent times due to the impact of quantitative easing. At some point, this process will need to be reversed. How will the US central bank go about shrinking its balance sheet and will it be disruptive to financial markets?

Read John's outlook in full