Sunday, 30 August 2015

Stories we should be thinking about

A few finance and related stories we need to be thinking about before Monday morning:


Macro matters:

An interesting last week as I recounted in this week's Financial Orbit Speaks...I hope this did not apply to any of my readers:



Am not sure that the Jackson Hole Summit was really worth all the preview newspaper columns as this article notes the much heralded Stanley Fischer comments...were quite boring:

Fed will raise at a gradual pace
Fed will consider foreign economies in policy decisions
Meeting policy goals for domestic economy is good for the global economy
After Chinese events Fed is watching for any possible economic effects more closely than normal
Dollar strength could hold back growth through 2016 and possibly into 2017
Rate path matters more than the timing of the first hike

Fed needs to proceed cautiously with normalisation



It certainly has been a long time since the last rate hike: 

(h/t @jsblokland)

Talking about worries for the US economy @Jeannasmialek observes that maybe nearer neighbours should be more of a concern than the current worry of China:


Far too much debt in the world...but who should you worry about the most?


(h/t @Market_Matter)

Which country has the most skilled workers?



Europe's immigration challenge: complex and getting more complex 


(h/t @JSaryuszWolski)

Looks to me as per via this poll of polls reported by @YanniKouts that Greece after the September election appears set to have a period of coalition again formally or informally (and note the large amount of undecided voters): 

Syriza 24,5, ND 22,4, GD 6,1, Potami 5,6, KKE 5, LAE 4,3, PASOK 4,1, EK 3,9, ANEL 2,4, und 14,6

Still at least the risk of an economic schism between the EU and the IMF over Greek debts is perhaps being averted (although I observe that a debt restructuring is not really cancelling debt...):

'A form of debt restructuring rather than outright forgiveness should enable Greece to handle its "unviable" debt burden, IMF Managing Director Christine Lagarde told Switzerland's Le Temps."We are talking about extending maturities, reducing rates, (making) exemptions for a certain period of time. We are not speaking about cancelling debt," she added.However, the interview made no mention of whether the IMF will take part in the new €86B bailout. Lagarde previously said the fund would make its decision by October'.

I liked this via @AntoniaOprita:

'I made up a new word to describe #EU disintegration after #Grexit and #Brexit included in the @OxfordWords'

A rough and volatile last few weeks for the Chinese market.  Unlike other emerging markets let's not forget they have demographic challenges building too


(h/t @Eurofaultlines) 

There are a couple of fascinating China reports this weekend.  This one from The Economist indicates how important the country is...



...whilst a Sunday Times report titled 'Chinese whispers grow against Xi' mumble about a 'revolt' with the Communist Party against 'the President's stance on corruption and the economy'.  Sounds to me like some interest groups with their noses out of joint due to the changes... Nevertheless always politically more tricky when the economy not firing on all cylinders.  

Some quite material uniformity of opinion about Russia from other countries in the world: 


Nice story here: 'The boom has made Silicon Valley soft: Companies are spending too much, investors are funding too many me-too ideas, and most founders have never had to confront any limits to their overweening ambitions. Venture capitalists won’t quite say they are looking forward to a correction, but some do say that a bust could toughen up the place'

Nearly September then...historically not a good month for markets.  Stay opportunistic and prepare for volatility i.e. feels like a stock picking market to me...


Company-related observations:


Hard not to conclude that Bwin/GVC/888 complex conversations in the UK gambling space are reflecting knowledge that they are sub-scale


The Sunday Times noted in a report that 'The £1bn buyout battle for Bwin.party is expected to take a twist this week as the gambling company looks set to dump one suitor, 888, for rival GVC Holdings...(who) tabled an offer worth about £1bn on Friday' 

Anyone interested in Ocado should read this:

“Building revenue internationally is critical for their future, and they need to get their skates on.”

Interesting write-up on Kimberly-Clark who I see have a share price right near an interesting support level...

...as I fundamentally wrote up earlier in the Q2 earnings season here.  

Amazing share of social media interactions that Facebook has: 


Not the easiest last few months for Twitter



'German luxury car giant Bayerische Motoren Werke AG or BMW Group is looking to go all-electric over the next 10 years due to the upcoming stricter carbon emission laws. Virtually every BMW model would be converted to electric drivetrains, including range-extending engines and plug-in hybrids'.  Wow (link here). 

Other news from the Sunday Times:

'Barclays to sell Portugal retail bank...the sale could fetch as little as Euro300m - less than the value of the assets' 

'SABMiller bolsters takeover defences...SAB shares closed last week at 3054p, having traded closer to 3800p just a few months ago.  It is right to be apprehensive' 


And finally...

Very true...

 (h/t @ValaAfshar)


Have a good week

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