Geld Zug

Geldzug: WILL THE US DOLLAR BECOME ANOTHER CASUALTY OF COVID-19?

22 July 2020 The economic consequences of the COVID-19 pandemic in the US are expected to trigger a fall in the US dollar against major global currencies over the next four years. By 2024 the Australian dollar could rise as high as $0.84 (US 84 cents) The fall in the US dollar (USD) will be probably be associated with rising inflation in the US, from the present level of less than 2% to as high as 5%. This does not mean there will be worldwide inflation – other countries will be able to decide how much inflation they allow in [...]

2020-07-23T14:26:15+00:00July 23rd, 2020|

Geldzug: WILL COVID-19 CRIPPLE THE 4 BANKS?

18 June 2020 Bank profits have been falling since 2015, but the latest half-year was particularly dismal. Loan growth was weak even before COVID-19 arrived on the scene, and the banks were already paying hefty remediation charges for their crimes against their clients. Are the COVID-19 loan impairment charges going to be the straw that breaks the camel’s back... [read more]

2020-06-19T13:25:01+00:00June 19th, 2020|

Geldzug: HOTWIRING THE CHINESE ECONOMY

9 June 2020 The Chinese economy has stalled. The manufacturing PMI for May was an anaemic 50.6, a touch worse than April’s 50.8. The PMI is a dispersion index, which means that figures above 50.0 indicate expansion, and figures below 50.0 indicate contraction. So manufacturing growth is only just in positive territory. Trivium’s National Business Indicator tells the same story. In the first week of June it had reached 87.8%, compared to 85.3% a month earlier. In particular, new export orders remain very weak as the rest of the world struggles with COVID-19... [read more]

2020-06-08T13:50:28+00:00June 8th, 2020|

Geldzug: WARREN BUFFETT IS NOT BUYING RIGHT NOW

5 May 2020 Warren Buffett provided a couple of surprises at Saturday’s annual meeting of Berkshire Hathaway. First, he admitted that he had made a mistake in owning airline shares, because the industry was unlikely to bounce back quickly, so he sold out of all four big US airlines in April... [read more]

2020-05-04T16:47:11+00:00May 4th, 2020|

Geldzug: CHINA IS RECOVERING

1 May 2020 China is recovering, not only from COVID-19, but also from the GDP collapse caused by its lockdown. We know this because the central government has begun to relax several key restrictions on travel and spending. First, China’s children are being allowed to go back to school. All provinces are phasing in the resumption of regular classes over the next six weeks. In the land of the one-child policy, the return to school is psychologically very important. Even though COVID-19 very rarely kills young people, no Chinese government wants to be responsible for any child mortality. Remember the [...]

2020-05-01T20:26:08+00:00May 1st, 2020|

Geldzug: OKLAHOMA – WHERE OIL FUTURES GO TO DIE

21 April 2020 The day oil died was Monday the 20th of April 2020 - for the first time in history the price of a novated futures contract CL00 for Crude Oil WTI went negative (“CLK20” ticker on the CME for May 2020). It got buried -$37.63 below ground, final resting place Cushing, Oklahoma. Speculators holding those futures and retail investors holding the ETF “USO” will have, in market parlance, been “carted out” on the day. Whilst the next roll month is still trading in positive territory (at time of writing!) the issues that caused the May contract to hit [...]

2020-05-01T20:25:50+00:00April 22nd, 2020|

Geldzug: CHINA STOPPED COVID-19 BY STOPPING ITS ECONOMY… …BUT CAN IT RESTART ITS ECONOMY WITHOUT RESTARTING COVID-19?

23 March 2020 Chinese authorities have told the world that COVID-19 has been contained inside China. Rules about isolation are being loosened – even in Wuhan – as the number of new cases diminishes. The number of cases outside the core areas around Wuhan remain small, because the policies of quarantines and draconian travel restrictions have succeeded in preventing new cases in the rest of China. Big cities like Shanghai and Hong Kong have set excellent examples of how to handle a pandemic, because their leaders were smart enough to listen to the experts and to act decisively very early [...]

2020-03-24T11:56:37+00:00March 24th, 2020|

Geldzug: BANKS FY2019 – THE PAIN GOES ON AND ON

22 September 2019 The banking sector has underperformed the Australian market since 2015, and the results for the year to 30 September 2019 suggests that another year or two of underperformance is still to come. The latest results were dismal. Cash profits fell by 7.8% ($2.9bn) year-on-year. Revenue growth was minimal to negative as the big banks lost market share to their newer and more agile competitors. Banks’ cost to income ratio rose by 313 basis points on average, ranging between +200bp and +540bp. Net interest margins (the spread between banks’ lending rates and their cost of funds) narrowed for [...]

2019-11-22T14:54:21+00:00November 22nd, 2019|

Geldzug: BREXIT FROM A EUROPEAN VIEWPOINT

23 November 2019 In the wake of the GFC, and again after the June 2016 Brexit referendum, many fund managers left the City of London for European shores, in search of lower tax rates and less regulation, not to mention the fear that Brexit would cut them off from their clients’ money. But most of the English fund managers who flocked to Switzerland have long since departed. The fund managers were unable to adapt to Swiss cultural norms, or they deemed Switzerland too “boring”, or for many other non-substantive reasons in a long litany of typical English whinges. The “boring” [...]

2019-11-22T14:31:26+00:00November 22nd, 2019|
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