Yes, its out; the US non-farm payrolls for June. In between love island, the World Cup footie and what counts as financial porn (endless tit-for tat negotiations on tariffs and Brexit) you might have missed these. For those fretting about interest rate rises on an overheating employment market, I shouldn’t worry too much that it […]
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The herding instinct is strong in markets. Solomon Asch would characterise this as ‘informative conformity’ where the participant would disbelieve the evidence of their own eyes and yield to the group think. In Asch’s experiments, the results were remarkable, particularly given the exclusion of outside variables beyond the comparative data (the height of the columns […]
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So if Trump’s tariffs are going top hurt the US so much why is the US dollar going up by so much? If Trump’s tax reductions are going to increase the budget deficit, why are currency markets so unconcerned? It is because currency markets understand Trump is going to win. His tax cuts are […]
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Spare a thought for those long suffering shareholders of German commercial TV stocks, RTL and Prosieben as Morgan Stanley dumped on the stocks with a negative report on Friday, sending them down a further 7% and -6% respectively against the DAX index that was up +1%. Presumably it was another rendition of the argument that […]
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Prices are set by the marginal buyer, while financial markets establish conformity around valuation currencies that encourage buying, which in turn stimulates more borrowing and therefore more ‘moolah’ for those that dominate these markets. The latter obscures the ‘real’ price that is being paid by the former, which is why they need tools such as […]
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For Gold bugs, wouldn’t you rather invest in a miner, where its production currency had contracted by almost -20% relative to gold’s principal selling currency, the US dollar? Unfortunately, when the currency in question is falling due to political instability and government threats of confiscation without compensation of property based on race, then the answer […]
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Time Warner shareholders may feel a sense of relief that the AT&T bid is now clear to proceed, but the harsh reality is that they are being screwed. Time value and a declining performance and share price of AT&T has seriously eroded the original offer premium to … ZERO. Indeed, it could be strongly argued […]
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Recency bias is alive and well. “At long last, normal profits are becoming normal for airlines”, so says the IATA in its June 2018 industry update titled “Solid Profits Despite Rising Costs”. After a couple of years of improving margins and ROIC, is this a paradigm shift for investors to jump aboard? Unfortunately, it feels […]
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