Delivering Global Macro Investment Insights

DeSaque Macro Research

DeSaque Macro Research Limited was formed by Said DeSaque in April 2012 with the view to delivering global macro investment insights aimed at providing new ideas to clients.

Said DeSaque has over 26 years of experience working as a professional economist in financial services. Prior to establishing DeSaque Macro Research, Said held positions as Senior Economist at Robert W Baird and William Blair. He began his career as a graduate at PaineWebber in 1986, where he eventually became Head of the London Economics Department.

Said takes a very keen interest in international relations, along with their implications for economic development. His research interests include the economic transformation of China and its implications for global capital markets, particularly in the United States. He is a member of Chatham House in London.

The US economy and capital markets have historically been Said’s main focus of attention. He frequently presents his views to institutional investors in diverse geographic locations. In recent years, Said has also been carefully monitoring economic developments in Asia, particularly China and Japan.

US Equity Valuations Get Richer, but Economic Outlook Uncertainties Remain Unresolved

US Equities and the Real Economy: Fed's COVID-19 Response Suggests Another Protracted Disconnection

Fed Shifts Focus to Heal US Financial System to Facilitate Escape from COVID-19 Induced Recession

Global Economist, DeSaque Macro Research

Said Desaque

Global Economist

Macroeconomics

The better-than-expected US employment data for May was partly attributable to the roll-out of Payroll Protection Programme (PPP) loans. Borrowers would be eligible for forgiveness on their loans if at least 75% of proceeds were deployed to get payrolls back to their 15 February levels by 30 June.
Significant changes to the PPP loan programme were made effective last week, notably an extension of the period over which funds can be deployed to rebuild employment to 31 December, as well as a higher percentage of disbursements being allowed for non-payroll purposes.
US equity investors will remain focused on improvements in an economy has already bottomed, despite the level of activity remaining depressed. Risks of fiscal policy relapse have not been properly discounted by equity investors, but continued support will push risky assets even higher as the recovery continues.
Corporate bond issuance has been strong in 2020, particularly by investment-grade borrowers, but the speculative use of funds has fallen since COVID-19 pandemic went global. Continued strong bond issuance suggests that borrowers are seeking to build cash buffers during a period when the business outlook remains highly uncertain in order to ensure continued solvency.
US banks are currently undergoing additional stress testing due to the unexpected unraveling of US labour market conditions. Demands by the Fed for banks to suspend dividends after these tests will depend on their assessment of capital buffer adequacy, particularly given the outlook of deteriorating asset quality and continued pressure on profitability.

The better-than-expected US employment data for May was partly attributable to the roll-out of Payroll Protection Programme (PPP) loans. Borrowers would be eligible for forgiveness on their loans if at least 75% of proceeds were deployed to get payrolls back to their 15 February levels by 30 June.
Significant changes to the PPP loan programme were made effective last week, notably an extension of the period over which funds can be deployed to rebuild employment to 31 December, as well as a higher percentage of disbursements being allowed for non-payroll purposes.
US equity investors will remain focused on improvements in an economy has already bottomed, despite the level of activity remaining depressed. Risks of fiscal policy relapse have not been properly discounted by equity investors, but continued support will push risky assets even higher as the recovery continues.
Corporate bond issuance has been strong in 2020, particularly by investment-grade borrowers, but the speculative use of funds has fallen since COVID-19 pandemic went global. Continued strong bond issuance suggests that borrowers are seeking to build cash buffers during a period when the business outlook remains highly uncertain in order to ensure continued solvency.
US banks are currently undergoing additional stress testing due to the unexpected unraveling of US labour market conditions. Demands by the Fed for banks to suspend dividends after these tests will depend on their assessment of capital buffer adequacy, particularly given the outlook of deteriorating asset quality and continued pressure on profitability.

Equities Buoyed by PPP Loan Impacted Employment, but Cash Hoarding and Bank Stress Tests Loom Large