Applied Financial Macroeconomics and Investment Strategy: A Practitioner’s Guide to Tactical Asset Allocation

by Robert T. McGee, T McGee

The absolute and relative performance of various asset classes is systematically related to macroeconomic trends. In this new book, Robert McGee provides a thorough guide to each stage of the business cycle and analyzes the investment implications using real-world examples linking economic dynamics to investment results.

Genres: Finance, Economics

251 pages, Paperback

First published March 15, 2015

Reviews

[Hà Bùi · Rating 5 out of 5]

Despite its professional title, I think this book did a great work in bringing the understands of economics cycles to readers outside investment business. After providing a framework about various economics/business indicators and their impacts on economics decisions, the book connects those activities with one of the most importance indicator: interest rate. The book then explains in details about the impact of interest rate in adjusting business cycles, as well as providing lessons about the the successes and failures of central banks in using these tools, with examples from the Great Recession in 2007-2008 in the US, the recession in the EU and Japan. The book then explains the monetary policy’s impacts of monetary policy to various of asset classes: bond and credit, equities, and commodities. It provides a hint for which asset class we should allocate our capital during periods in a economics cycles.

Besides providing an explanation about cycles and their interconnection, the book also provides explanation for various economics events we are seeing recently. The book explains the both the positive effects of globalization on income inequality, as well as, the negative side of globalization of budget deficit imbalance between nations. The book also explains why human has made great progresses in 20 centuries and the consequences of those progresses. Environmental activities we have seen recently is just a consequence of those super trends. This book also provides an insights on “new normal” in monetary policy that we are having difficult time to understand.

One thing I like this book also is that it is written in a data-driven manner. The author gives his points and data/graph to back his arguments. You don’t need to understand too much finance and economics to understand his arguments. The data can be collected and graph can be replicated from public sources like the FRED. I myself did try to recreate graphs he provides in the book and I saw the same picture he demonstrates.

“Every business cycle is the same except for what is different”. I think this book explains persuasively what is similar and what is different this time. I am not in investment business, but I find myself making senses of some economics news recently. I have spent a quite amount of time with this book and I might acknowledge that it’s not an easy read, but with patiences the book deserves your time.

[Guilherme Dantas · Rating 4 out of 5]

Ótimo livro, o título fala por si. Abordagem de RBC aplicada aos investimentos. Para o Brasil a visão muda bastante, mas como EUA toca o mundo saber onde eles estão no ciclo é obrigatório. Uma versão brasileira desse livro seria excelente.

[Ethan Lambert · Rating 5 out of 5]

One of the best books in Macro out there if not the best book. Shame very few have read this brilliant masterpiece.

[Filip Brajan · Rating 1 out of 5]

For serious traders and Investors this is amateur level. Price of 60€ for this? Waste of money and time.
Not recommended.

[Felipe De Castro Lopes · Rating 5 out of 5]

Melhor livro de macroeconomia que já li. Com certeza lerei mais uma vez. Pena não ter mais obras desse autor.

[Brian M Vaughan · Rating 5 out of 5]

great book for thinking about how macro economics applies to investment strategy, understanding business cycles.