Interview with Santiago Carbó


Do not shoot the economist. Neither the economy is silent cinema, nor the economists, pianists. This is how he presents himself Santiago Carbó, CUNEF Professor of Economics and Finance, Professor at the British Bangor University and director of Funcas Financial Studies. Prudent but with very clear ideas, Carbó (Gandía, 1966) flees from the noise of the markets and the gurus that create opinion in social networks. Considers that there is no reason to activate alarms either in the economy or in the financial markets.

There will be crisis, yes or no? That seems to be the question.

There is a lot of noise in the markets, which are rare and in a complicated moment. But the international economy is still strong. Recession? There are no signs or alerts from international organizations. It is more the vision that gurus have that create opinion through social networks. That there is a deceleration? Yes. It was irremediable that it would happen after a period of very intense growth since 2010 in the United States. In Europe it has not been so intense but since 2014 it is growing. The appearance of the figure of Donald Trump generated many doubts and uncertainty, especially for the commercial war. It also seems that there are signs of correction of the bubble in China. The Eurozone has unresolved problems (Italy, Brexit) and rising interest rates … All this generates uncertainty that will remain.

What impact will the European Central Bank have on a less expansionary monetary policy?

This is discounted since the ECB will toughen monetary policy. If you do not raise interest rates there will be doubts, just as if you do it very quickly. But for now everything points to that we are in line with the already discounted. I think the first rate hike will be in September 2019 and that's what the markets anticipate.

Do you speak of the markets? Are they overrated?

Maybe yes, apparently they are expensive, especially those in the US. There will be a correction there. In Europe, less. The shares are very expensive, while the sovereign debt, in general, has bad prospects. On the contrary, there is corporate income from large companies, such as the German ones, with a good outlook. For a moderate risk investment profile, it is a reasonable asset. In any case they are times of volatility.

The investor, are you prepared for these convulsive times?

The qualified investor knows how to handle the stock market in good times and bad times. On the other hand, in bad times, the unqualified are not used to losing money. They do not want to assume it.

Looking home, how do you see Spain?

The Spanish economy still has some upward trend and will grow more than 2% in 2019, which will generate employment. For now, I rule out falls or increases in GDP close to zero. The latest employment data are positive and not only in construction and services. It is true that all the duties in the reduction of the public debt have not been done, but, at least, the instructions of Europe in this sense are fulfilled.

And the bag? How is the Ibex?

I think we have a cheap and attractive stock market, but it relies heavily on large companies (such as Telefonica, Repsol) and banks, which introduces volatility due to their exposure to emerging markets or negative news such as the controversy over corporate taxes. the mortgages.

Investment funds?

The forecast is that 2019 will not be a good year on the stock markets, but the managers will adapt and may in the EU achieve better returns than those of 2018.



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