Sunday, 20 September 2015

Stories we should be thinking about

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


Macro matters:

The fallout from the Federal Reserve's policy meeting and press conference continues. I enjoyed this piece from @AntoniaOprita (link here) which observed:


'Fed Chair Janet Yellen has repeated ad nauseam that the Fed was data-dependent, and even said that "some" improvement in labor markets would be enough to persuade the central bank to raise interest rates. To make such a U-turn in a month, when the data does not justify it, shows that the Fed is making it up as it goes along'

Central bankers are continuing to come in for a lot of criticism - as shown by the cartoon below:


This piece below from the front page of the Weekend FT was deeply provocative (and actually read much more as a macro fear piece than anything to do with the use of cash per se)...

...hence my own view would be more akin to the conclusion here:

'What Haldane and his colleagues must focus on is providing a clear practical and theoretical distinction between monetary and fiscal policy policy (i.e. the control of base money), and how parliament might best legislate a rule for the distribution of helicopter drops without compromising central bank independence...This would be a much better use of the Bank’s time than trying to abolish something really useful – cash'

It certainly is a different world. As this article from Zero Hedge notes the average worker is struggling: 

And as an aside...what a line from the CEO of JP Morgan

“It’s not right to say we’re worse off … If you go back 20 years ago, cars were worse, the air was worse. People didn’t have iPhones.”


Turning to Europe, on the day of the Greek election hard not to agree with this:

'Greece’s ongoing debt negotiations has shown that Athens is grossly mismatched relative to its eurozone creditors. The next Greek government will face more of the same'

Tsipras wins Greek vote by clear 33-35 percent, according to exit polls

Also did you see late on Friday that: 'France’s credit rating was cut by Moody’s Investors Service, which said slow economic expansion and political constraints will hamper the country’s ability to reduce its debt burden. The nation’s credit grade was lowered one step to Aa2, the third highest investment-grade level' 

Immigration / migration is a hot topic in Europe currently...but from a penetration level other parts of the world have a much more welcoming approach:


(h/t @JohnFMauldin)

Worthwhile noting Chinese President Xi Jinping's upcoming state visit to the United States slated for Sept. 22-2.  This piece titled 'China-U.S. trade shifts towards balance, sustainability' is worth a read observing that "China and the U.S. do not compete a lot in export markets...It's good for us when China grows because they supply our consumers with cheaper products, and they don't force us to lower our prices on our export...That's why I conclude that Chinese growth was in America's interests. We're much more complementary than we're competitors" 

Talking about China three interesting charts I noted over the weekend...first not such a set of dire 'latest' data...
...still lots of scope for higher oil consumption...
...and just look at that structural urbanisation trend:


(last two charts h/t @PlanMaestro)
Kind of interesting (link here):
'The Russian deployment to Syria is game-changing. It will alter the nature of international negotiations, compromise and weaken the cohesion and efforts of the U.S.-led anti-ISIS coalition, strengthen the Assad regime, and initiate direct Russo-Iranian military operations for the first time. The U.S. and its partners must fundamentally reassess their approach to the Syrian conflict in light of this critical inflection'

A few final charts...democracy in Africa...


...fascinating on the split of the US budget (and note that the net interest cost is half the overall borrowing)...


...Despite record retail silver demand, the price of silver is mired at five year lows which @smaulgld notes is strange (link here): 


Something to keep in mind for the next few weeks via @RyanDetrick (although the seasonals sharply improve deeper into Q4): 


Company-related observations:


Interesting on ad blocking and related (link here): 

Welcome to hell: Apple vs. Google vs. Facebook and the slow death of the web

Mining stocks are cheap...


Interesting on the potential large beverages deal:
'Anheuser-Busch InBev is considering an audacious plan to switch its tax base to the UK if it can pull off the proposed £180B takeover of SABMiller...Altria, which controls 27% of SAB Miller and three board seats, currently collects tax free dividends thanks to a U.S./UK treaty, which would die if the new company were based in Belgium'

Fascinating on sector valuation over the last decade or so (link here):


(h/t @ValueWalk)

And finally...

Have a good week

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