Institutional Investor (June 10)
“As the U.S. economy has become a knowledge economy, motivating and engaging talent has only grown in importance given its positive effect on productivity.” But attributes like these “aren’t captured in traditional financial statements.” Since 2020, “the Human Capital Factor” has been quantifying “the link between human capital and future equity value” for investors and has “outperformed the S&P 500 every year since its launch.”
Tags: Attributes, Economy, Engaging, Equity value, Financial statements. 2020, Human Capital Factor, Investors, Knowledge economy, Motivating, Outperformed, Positive effect, Productivity, Quantifying, S&P 500, Talent, U.S.
Financial Times (June 8)
“Donald Trump’s gyrations on trade policy have not broken global financial markets just yet — but what is happening in Hong Kong shows they are feeling the strain.” For over a month, Hong Kong’s interest rates remained fixed at just above 0%, which is peculiar, “Its currency is pegged to the US dollar” so this presents a prime arbitrage opportunity, which is going untaken. “This little episode reveals a disturbing fragility. Markets may appear to be taking all of the Trumpian disruption in their stride, but when a dislocation of this sort persists for more than a month, it is a warning sign. Watch out for trouble ahead.”
Tags: 0%, Arbitrage, Broken, Currency, Dislocation, Dollar, Fragility, Global financial markets, Gyrations, Hong Kong, Interest rates, Peg, Strain, Trade policy, Trump, U.S.
Institutional Investor (June 4)
The U.S. deficit “is now set to explode, according to J.P. Morgan Asset Management’s Michael Cembalest, who derided the Republicans for their new budget bill that will add trillions of dollars to the deficit in coming years.” His recent note to institutional investors estimated that the Big Beautiful Bill passed by the House will increase the deficit by “$2.8 to $3.4 trillion… over the next ten years” and, “if certain temporary provisions become permanent, the cost could reach $5 trillion.”
Tags: Budget, Cembalest, Cost, Deficit, Derided, Explode, House, Institutional investors, J.P. Morgan AM, Provisions, Republicans, Trillions, U.S.
South China Morning Post (June 3)
“Hong Kong companies favour markets closer to home and in Southeast Asia to grow their businesses because of higher tariffs and other trade barriers in the US and Europe, according to a survey by HSBC, with many expressing confidence about their expansion plans.” Following the disruption of Trump tariffs, the new pivot is being “supported by Hong Kong and Beijing’s efforts to forge stronger ties with markets in Southeast Asia and the Middle East as US-China trade ties remain tense.”
Tags: Businesses, China, Companies, Confidence, Disruption, Europe, Expansion plans, Hong Kong, HSBC, Markets, Middle East, Pivot, Southeast Asia, Survey, Tariffs, Trade barriers, Trump, U.S.
Wall Street Journal (June 3)
“As exports of rare-earth magnets have virtually ground to a halt, carmakers face hard decisions about whether they can continue to keep some plants operating.” Major U.S. automakers are considering work arounds like “producing electric motors in Chinese factories or shipping made-in-America motors to China to have magnets installed.” If they do “end up shifting some production to China, it would amount to a remarkable outcome from a trade war initiated by President Trump with the intention of bringing manufacturing back to the U.S.”
Tags: Automakers, Carmakers, China, Decisions, Electric motors, Exports, Factories, Halt, Manufacturing, Plants, Production, Rare-earth magnets, Trade war, Trump, U.S.
Barron’s (June 2)
“China hit back at the U.S. early Monday, disputing President Donald Trump’s accusation that it’s failing to uphold its side of the bargain of the trade agreement reached last month…. The back-and-forth barbs are a bad sign for investors who were hoping that the trade war over tariffs was starting to de-escalate.”
Tags: Accusation, Back-and-forth, Barbs, China, De-escalate, Disputing, Investors, Tariffs, Trade agreement, Trade war, Trump, U.S.
Fortune (June 1)
“Home-sale prices in 11 of the 50 biggest U.S. metro areas are already falling, according to data from Redfin, which sees the nationwide median sale price declining 1% on an annual basis in the fourth quarter of this year. That’s as listings grow and mortgage rates remain high, while sellers outnumber buyers by record amounts.”
Tags: Buyers, Declining. Q4, Falling, High, Home, Listings, Metro areas, Mortgage rates, Nationwide, Redfin, Sale price, Sellers, U.S.
Bloomberg (May 30)
According to respondents in a Bloomberg survey, “the European Central Bank will lower interest rates twice more.” They predicted “quarter-point reductions on June 5 and at September’s meeting, when new quarterly forecasts should shed more light on the effects of US President Donald Trump’s reordering of global trade.” Respondents also cautioned that the ECB “shouldn’t wait too long between those moves or investors will conclude that its easing campaign is already over.” If their predictions hold, the deposit rate would rise to 1.75%, “where the poll sees it settling through the end of 2026.”
Tags: 1.75%, Easing campaign, ECB, Global trade, Interest rates, Investors, June, Predicted, Quarterly forecasts, Reductions, Respondents, September, Trump, U.S.
New York Times (May 29)
Companies initially “welcomed a court decision striking down President Trump’s tariffs. Then a stay of that ruling left no one breathing easy.” Uncertainty, with a splash of potential relief, now prevails as U.S. businesses struggle to digest “the latest twist in Mr. Trump’s roller-coaster trade war, which has made it impossible to plan more than a few weeks in advance. It’s particularly hard on industries that place their orders entire seasons ahead of time.”
Tags: Businesses, Companies, Court decision, Impossible, Industries, Orders, Relief, Roller coaster, Ruling, Stay, Striking down, Struggle, Trade war, Trump’s tariffs, U.S.
Fortune (May 24)
“Predictions that the dollar’s dominance will come to an end soon have proliferated since President Donald Trump launched his trade war,” but it’s not so simple. “Assets in other top economies like China, Japan and Europe still aren’t as attractive as those in the U.S.” while potential rivals also “suffer from governance or political headwinds.” Until another currency surmounts these issues, “global investors are faced with the familiar reality that there is still no alternative to the greenback, which has been the currency of choice for international payments and reserves for decades.”
Tags: Alternative, Assets, Attractive, China, Dollar, Dominance, Europe, Governance, Greenback, Headwinds, International payments, Investors, Japan, Political, Predictions, Rivals, Top economies, Trade war, Trump, U.S.
