Welcome to

thoughts in the market. I'm Andrew Sheets, Chief Cross Asset

Strategist to Morgan Stanley.

Along with my colleagues bring you a variety of perspectives,

I'll be talking about trends across the global

investment landscape and how we put those different ideas together.

It's Friday, September 20th at 2 p.m. in London.

When Central Banks reduce interest rates or buy bonds directly through quantitative easing, they lower the interest rate on safe

government bonds. In theory, this should lower the cost of businesses and individuals to borrow,

spurring confidence and economic activity. But like a lot of things in life, the story is more complicated.

Let's start with housing. In theory, lower interest rates help consumers by making mortgages

less costly, and they do. But given that interest rates have already been low for a while, the impact

of recent moves for homeowners is relatively modest. And for renters, who represent a much larger

share of households in the U.S. and the UK than 15 years ago, it doesn't help at all.

What about savings?

Government bonds are popular for people near retirement who given their stage in life have

less appetite for risk.

And the lower these bond yields, the more savings are

necessary to generate a given amount of retirement income. If you are 65 years old in the

UK and would like to buy an annuity that pays you about 25,000 pounds per year for the rest of your life,

that's about $31,000, you need to have about $600,000 or about $750,000 in retirement savings.

No wonder people feel pressure to save more rather than spend.

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