28


info@eastcorkjournal.ie Was 2017 A Good Year For The Global Investment Markets? The US Dollar is the


most influential currency in the world and 52% of world equities are


by GERARD O’BRIEN As we move towards the


end of 2017, it can be an appropriate opportunity to pause and review some of the market movements and developments we have seen in 2017. It appears at this late stage in December, that 2017 will stack up well ver- sus history. However, as al- ways, there was plenty hap- pening under the surface. The average figures of


Investment Banks polled by Zurich Investment Manage- ment at the start of the year forecast the S&P 500 to end 2017 at 2349, or a growth figure of 4.9%. It currently stands (as at 19th


Decem-


ber) at 2690, far above the average consensus. Howev- er, to review the above in isolation would be lax, and would be failing to acknowl- edge one of the main influ- ences on the global equity markets during 2017 – the exchange rate fluctuations of the euro currency against the US dollar.


The weakened ‘Greenback’


Global geopolitical risks


opolitical risks come to the fore, many


2017 also saw many ge- of which ul-


timately subsided. There were elections in the Neth- erlands, France, UK and Germany, the triggering of Article 50, and a deteriora- tion of the US/North Ko- rean relations, to name but a few. However, here at Herit-


listed


in the US. It is also worth noting that the Hong Kong dollar, which is pegged to the US dollar, and resource or ‘commodity’ currencies such as the Canadian and Australian dollars are also highly influenced by the ‘Greenback’. Currency fluctuations are


always an important consid- eration for investors in risk assets, and can be hard to avoid, whether directly or indirectly. The US dollar weakened by close to 11% this year versus the euro, in a move from 1.05 to over 1.20 at one stage (it stands at 1.18 today). This type of currency movement can lead to a direct reduction in the returns for Euro-based investors.


age Wealth, one of our roles to cut through the ‘noise’ and to identify the key driv- ers in the global investment markets. The graph below illustrates how increases in volatility (chiefly due to political concerns) over the last number of years has not necessarily led to a substan- tial impact on stock market levels.


The global economy continues its recovery What


we have seen


throughout 2017 is a gradu- al improvement in the glob- al economic backdrop. The more


recovery seen in GDP and recent


synchronised global positive


sentiment


data has buoyed risk asset prices. This has led to dou- ble digit returns in equity markets across many re- gions.


Equity data and growth


figures continue to be posi- tive, and volatility levels are at records lows. However, if you look beneath the sur- face, there has also been an increase in sectoral disper- sion. For example, the Tech sector has returned over 20% this year, whilst both the Energy and Telecom sectors have digit falls.


seen double Equities versus Dear Karen


word that it would fit on the tractor I have. I then tried to use it the


by KAREN WALSH


Dear Karen, I am a farmer but I some-


times do a bit of contracting for machinery to supplement my income and I would have good knowledge about the quality of farm machinery. I was recently looking for a land leveller for my own farm and I saw one on a website similar to done deal. There was a number and


it said his name was Mick. I rang the seller and we agreed to meet up. He came to the farm and brought the land leveller with him. He was eager for a cash sale and asked could we keep it out of the books and as he gave me a good price I agreed. He said if


there was any


problems with it to give him a shout and he gave me his


next day, but it wouldn’t at- tach to the tractor and the mechanism appears to be faulty. I rang the seller and he denied he sold it to me and said he can’t help me and I tried ringing again but he won’t answer. What should I do?


Dear Reader, As a purchaser and par-


ticularly in respect of private treaty sales, you should be aware of the legal doctrine called ‘Caveat


Emptor’.


Unfortunately you are re- sponsible


for checking the


quality and suitability of the product and there is an onus on you to do so. Ordinarily


a consumer


will be protected under the Sale of Goods and Supply of Services Act 1980 where goods must be of merchant- able quality, fit for purpose and as described in the ad-


vert. Two factors need to be considered when ascertain- ing whether you are a con- sumer. Firstly it needs to be established whether the con- tract was made in the course of a business and secondly whether the goods supplied were the type ordinarily sup- plied for private use or con- sumption. It could be classified


here that you were making a commercial purchase for use in your business,


trade


or profession and you may not be classified as a con- sumer. However, you would still have rights under con- tract law. As a general rule, the seller can either repair or replace the item. Alter- natively, they


can refund


the cost of the item to you. The first step in attempting to obtain redress from a sell- er is to approach the seller directly and see whether they will agree to repair or provide a refund. I see you have done that and he is re-


Bonds in 2017 For many investment


manager’s, a positive asset allocation towards equi- ties over fixed income has broadly been a positive in- fluence on their 2017 per- formance numbers, as fixed income markets have failed to repeat some of the robust gains seen in recent years.


Fixed Income The expectation of high-


er interest rates, an increase in political risks, and an ac- celeration in global growth all weighed on European sovereign debt year, whilst


prices at this the same


time a more positive allo- cation to the global equity markets materialised. The ECB’s quantitative


easing


programme is ongoing, and was extended in October to December 2018, albeit at a reduced pace. This would support the view that whilst we do not see a huge uplift in bond yields, European sovereign debt offers


Commodities Commodities, which tend


to do better as economic growth expands, have seen a broadly positive year so far in local terms although, as most commodities are priced in USD, it is worth


fusing to assist. The second step would be to instruct a solicitor and send a letter of demand. The success of this letter will likely depend on the contract you and the seller have. It will depend if you have any sort of guaran- tee or warranty connected to the machine. It doesn’t ap- pear that there is a warranty here unless the seller has one which he hasn’t made you aware of. If a solicitor’s letter fails


to obtain any redress in the matter it is advisable to consider initiating legal pro- ceedings. Legal proceedings can be brought in the small claims, district, circuit and high court depending on the level of damages sought for the breach of contract. The majority of consumer/ breach of contract type cas- es tend to be dealt with in the lower courts. It would have been better


if you had a written con- tract or an invoice or bill with the seller as you could have relied on this as proof of payment which you may need to rely upon at a later


Tel: 021 463 8000 • Email: info@eastcorkjournal.ie • Web: www.eastcorkjournal.ie


considering the impact of currency fluctuations in this area. Oil had a rollercoaster year and traded as low as $43 a barrel in June before rising to $57.76 (Crude Oil WTI) a barrel today.


Summary Overall, it looks like 2017


will be another good year for investors who main- tained a long-term outlook, and for those that did not get side-tracked by short term market noise and vol- atility. We will be meeting with


our clients in Q1 2018 to discuss our views and the global outlook for 2018. Gerard


O’Brien LL.B


LL.M CFP® QFA is a Certified Financial Planner and the Owner of Heritage Wealth Management, a Fi- nancial Planning practice based at 27 Cook Street, Cork. For more informa- tion, contact


gerard@heritagewealth. ie www.heritagewealth.ie Disclaimer: All data and


little


long-term value in the cur- rent environment.


information provided with- in this article is for informa- tional purposes only. Her- itage Wealth Management Limited makes no rep- resentations as to accuracy, completeness, suitability, or validity of any information and will not be liable for any errors, omissions or delays in this information or any losses, injuries, or damages arising from its use.


stage. In future, make sure you always get written proof of the sale. I think in your case, it would be helpful to print the website ad which gives proof of the seller’s phone number and name and you would will need to give a statement to your solicitor or you may need to give evidence in court to show there was an oral con- tract between you and the seller and to show you paid for and received the goods. It might be helpful to look if there is a serial number on the leveller which may trace back to the seller. In instances where a po-


tential breach of contract has occurred it will be im- portant to investigate who was at fault. If such a ma- chine was used for its spe- cific purpose and was not fit for that purpose and if you are classified as a consumer, you will have rights as far as seeking remuneration is con- cerned. If there is a fault it is advisable to immediately report it


to the seller. The


longer you wait to report a fault, the weaker your posi-


tion on a number of fronts is. It may be difficult to es- tablish whether


the goods


were fit for purpose or faulty at the time of purchase as there may have been an in- tervening act in the interim period from the time of pur- chase to the time you noticed the fault. The seller may also potentially argue the fault has arisen from wear and tear in the interim period. If the fault was present imme- diately after buying and you did not report it you may have difficulty obtaining a full replacement or refund. You should also be aware


of The Defective Product Act 1991 which introduced the idea of product liability and if a seller sells a faulty or defective product and harm such as personal injury is caused by that product, then the seller has been negligent and is liable for damages. I would recommend in all


cases that if you do discover a fault in goods such as ma- chinery you have bought, it is advisable to take immedi- ate action and notify the sell- er. If you receive no redress


eastcorkjournal


here, it is advisable to take legal advice and consider your options further. Karen Walsh, of Walsh &


Partners, Solicitors, comes from a farming background and is a solicitor specialising in agricultural law, land law and renewable energy and is author of ‘Farming and the Law’ available from www. claruspress.ie. The firm also specialises in personal injuries, employment


law


and family law. She has offic- es in Dublin and Cork. For further information please contact 01-602000 or 021- 4270200. Email: info@walshand-


partners.ie Web: www.walshand-


partners.ie Disclaimer: While every


care is taken to ensure ac- curacy of information con- tained in this article, Solic- itor Karen Walsh does not accept


responsibility for


errors or omissions howso- ever arising, and you should seek legal advice in relation to your particular circum- stances at the earliest possi- ble time.


@eastcorkjournal / #eastcorkjournal


Thursday, 21st


December 2017


Wishing you a happy, healthy Christmas and I look forward to seeing you all in 2018


www.heritagewealth.ie Gerard at


Gerard O’Brien LL.B LL.M QFA CFP® 96 Main Street, Midleton gerard@heritagewealth.ie


Call us today: 083 466 2040


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70  |  Page 71  |  Page 72  |  Page 73  |  Page 74  |  Page 75  |  Page 76  |  Page 77  |  Page 78  |  Page 79  |  Page 80