Spy, like everyone else is prone to drinking the doom and gloom kool-aid every now and then and getting a touch sombre about the state of the world – even with a comforting glass of something cold to hand. As Angus Hervey puts it, “The world feels scary right now. The planet heats. The clock ticks. The red lines climb. Death stalks the fields of Ukraine and the streets of Gaza. Famine looms in Sudan. And in the Middle East, the drums of war sound louder by the day. Habitats shrink, democracy’s flame sputters, authoritarianism and intolerance rear their ugly heads. Millions flee disaster and persecution. The debts mount. International cooperation falters.” Scary stuff indeed! And yet, in some unsung very good news, how about this: “Last year, extreme poverty declined to its lowest level in human history, an estimated 8.4%. Deforestation across the entire Amazon basin declined by 55% and violent crime in the United States declined to its lowest level since the 1960s.” All of these facts emerge in his TED talk that is utterly compelling – Spy urges all his readers to watch this brief but fabulous talk to give you a smile and put a spring in your step.
Electric vehicle (EV) sales may be faltering in Europe and the USA, but in China, no such slowdown is apparent. Spy notes that for the first time ever, EVs have outsold fossil-fuel alternatives. The China Passenger Car Association announced that 878,000 new EVs were sold in July. That was 51% of total passenger vehicle sales, marking the milestone. The industry was helped by cash incentives from the government for trading in an old gas guzzling car. Where China is succeeding, is the vast roll out of charging stations, helping local consumers overcome range anxiety. No wonder Europe is so terrified of the Chinese EV industry.
Spy took a peek at OCBC’s recommended funds. Almost all of them have given a positive return over the last 12 months. The best performer was the AB Low Vol Equity Portfolio, up a rather tasty 17% and Lion Global’s All Seasons fund is up 11%. At the bottom of the pile, Fidelity’s China Focus, is suffering and is off 15.4% over the last year. It does occur to Spy that it remains rather difficult to trounce the good old S&P 500, which just happens to be up +1,138.89 points or the equivalent of 25.86%. One can buy it very cheaply and not worry too much.
If you have very sensibly ignored the markets during the dog days of summer, you have missed the market gyrations of the last few weeks. The VIX, the volatility indicator, has declined 58%, from 38.57 to 16.19, over the last 7 trading days – the biggest one-week volatility tumble in its history. Japan has bounced back, as has US big tech and all the world seems happy again. The dramatic market moves gave some journalists and talking heads something to write and chat about but seems like a severe case of summery hot air.
It is election time, so the punch bowl in the US is well and truly keeping the party going. Uncle Sam’s credit card is being used so fast it is hard to keep up. American debt topped $35trn this week as the federal budget was $1.5trn in the first 10 months of fiscal year 2024. The Congressional Budget Office estimates that the federal budget deficit is going to be a whopping $2trn in fiscal year 2024. It must be fun to spend like no repayment is ever required.
If you enjoy a flutter in a casino on occasion, Spy recommends Nate Silver’s new book: On the Edge: The Art of Risking Everything. If you don‘t get to the end of the book convinced you will never play a slot machine (or pokie as the Aussies like to call them), you must be the eternal optimist. Silver unpicks how casinos use every trick available to maximise the chance the punters will lose and the house will always win. However, the book examines more than just gaming world, looking at other high-risk industries such as hedge funds, crypto, high-end art and more. It is thoroughly entertaining and illuminating.
Spy received reports this week that Legal and General Investment Management, is running its first ever outdoor campaign in Singapore. The jolly umbrella branding, familiar to many in the UK, is now plastered on the MRT at the Downtown Station. The campaign is all about branding at the moment.
Until next week…
