The Ultimate Measure Of Man
Monday Market Recap
Highlights
- The World Economic Forum kicks off in Davos, Switzerland where leaders will convene on major topics such as big tech, global trade, and environmental sustainability.
- Alphabet (Google) becomes the fourth US company to reach Trillion Dollar Market Cap. Joining Apple, Amazon, and Microsoft as part of the T(ea) club.
- Today marks Martin Luther King Jr. Day, first signed on November 3rd , 1983 by President Ronald Reagan.
Recent data support the expectation for a pickup in growth this year. World trade volumes appear to have stabilized after sharp declines since 2018. China has reported better-than-expected trade data – alongside rebounding industrial profits and improving manufacturing activity. Financial conditions have eased significantly in developed economies since early 2019, and look poised to filter through to support the real economy in the next six to 12 months. Gross domestic product (GDP) forecasts may stand in three months’ time, indicates global growth should be accelerating slightly through the year. This can lead to a positive environment for cyclical EM assets.
Japanese equities may benefit from the same dynamics – as well as a pause in U.S.-China trade tensions – due to the export-oriented nature of the Japanese economy. A few other factors work in its favor. A weakened Japanese yen – currently at the lowest level at 110 against the dollar since mid-2019 – has historically tended to help lift Japanese stocks. The Bank of Japan looks to stand pat on its ultra-loose monetary policy and the government remains on pace to launch sizable fiscal stimulus this year, providing further support for the market. An ongoing improvement in corporate governance is another positive. Share buybacks have surged – up 40% in 2019 to a record high of 7 trillion yen (about $64 billion), according to Morgan Stanley. This should help boost return on equity and share performance. Yet most foreign investors are still underweight the market.
Risks to toward global progress include profit margin erosion and an unexpected slowdown. For instance, revenue growth may boost corporate earnings even as profit margins decline, but higher costs – from wage increases or supply chain disruptions - may eat into profits.
What I'm Reading –
Finding Time To Invest In Yourself - Naval
How do you find the time to invest in yourself when you work a normal busy job? Rent your time.
Artificial Intelligence will fundamentally change the way we work and the current jobs and roles as we know it. How will you better prepare yourself for the future to come?
Naval Ravikant, Founder of Angel List, explains how to protect yourself and slowly invest the time necessary to gather resources, knowledge, and experience.
What I’m Watching-
Mike Wallace Is Here
Often we are so fixed on the life of the interviewee we don’t stop to think about the interviewer. When we focus on the subject more than the person conducting the interview, that usually means they are doing a good job. A stable of 60 Minutes for over 50 years, this documentary offers an unflinching look at the legendary reporter, who interrogated the 20th century’s biggest figures, and his aggressive reporting style and showmanship that redefined what America came to expect from broadcasters. Compiled of only archival footage from 60 minutes, the film explores what drove and plagued Wallace, whose storied career was entwined with the evolution of journalism itself.
View the trailer here.
Financial Thoughts-
Goldman Sachs has been an investor in Uber since 2011 and just sold its entire stake.
Read my quick take on this here and let me know what you think: https://www.hardycap.com/blog/uber
Quote of Wisdom
“The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.
– Martin Luther King Jr.