Indholdsfortegnelse for Issue 933 i MoneyWeek

Well. It rather looks like we have had enough of billionaires. Flick through the headlines written during Davos a few weeks ago and you’ll see a pretty clear change in the trend. “Forget philanthropy. The super rich should just pay their taxes,” said The Observer (some do by the way – see page 44). “Great and good on top of a mountain at Davos see ground shift beneath their feet,” said The Times. The “great annual jamboree of the globalists in Davos... felt out of tune with the times”, said The Daily Telegraph. “No more heroes for a global elite,” said the Financial Times. Look at the bits and bobs from the conference that filtered down to the rest of us and you will feel it too. A clip of…

Jeans manufacturer Levi Strauss & Co. is set to launch an initial public offering (IPO) this year, says Amelia Lucas on CNBC. It is aiming to raise $600m-$800m and reach a valuation of more than $5bn. The market for denim is healthy: Levi Strauss announced sales of $1.39bn for the three months to September, a 10% rise on the previous year. It won’t have the stockmarket to itself, however. VF Corp, which owns rival jeans brands Lee and Wrangler, plans to spin off its denim labels into a new company called Kontoor Brands. That flotation was to take place in March 2019 but the paperwork at the Securities and Exchange Commission was delayed by the US government shutdown.…

Exactly 15 years after Mark Zuckerberg launched it, Facebook has unveiled results showing that it is “remarkably resilient”, says Bloomberg’s Shira Ovide. Sales rose by more than 30% year-on-year in the fourth quarter, while its operating profit margin of 46% is “the envy of the corporate world”. Even the number of users in Europe and North America, two of the major areas of concern for shareholders, increased slightly, which was “a surprise”. Still, there were also some signs of weakness, including slowing revenue growth and investment spending rising twice as fast as sales. The impressive result “caps one of the most trying years” in Facebook’s history, says Georgia Wells in The Wall Street Journal. Last year, violations of users’ trust sparked a furore about how the group handles its users’…

“Active industrial policy is back in vogue in Germany,” says the Financial Times. After 30 years of championing free markets, German politicians and businesses are “coming to the view” that more state intervention is needed to maintain prosperity. “Technological disruption is threatening to eclipse Germany’s engineering prowess, while Chinese state capitalism is out to eat its lunch.” According to economic minister Peter Altmaier’s “national industrial strategy 2030”, that means protecting key companies from foreign takeovers and competition, and shaking up European competition rules to encourage the creation of national or EU champions. This would “clear a path” for big mergers, such as the “ill-fated attempt” to unite Siemens and Alstom, says Oliver Moody in The Times. Industry figures and politicians from Altmaier’s Christian Democrat Union (CDU) may see the strategy…

The World Bank’s board “can expect to hear few warm words from David Malpass”, the man widely expected to be nominated by President Donald Trump to replace current head Jim Yong Kim, says The Economist. Thanks to the convention that allows the US to select the head of the World Bank, it could soon be led by someone who has described it as “part of a giant sprawl of international organisations” that “create mountains of debt without solving problems”. There are fears that his “conservative disdain for big, unaccountable bureaucracies” will make him “a cost-cutting crusader” who “could stringently curtail the bank’s budget and ambitions”. Appointing Malpass would follow Trump’s past record “both for domestic and international positions, with leaders seemingly hand-picked to undermine the agencies they are tapped to…

In his latest memo to clients, billionaire distressed-debt investor Howard Marks admits he is increasingly concerned about rising “anti-capitalist sentiment” in the US, driven by left-wing populism. Democratic socialist US senator Bernie Sanders lost a leadership challenge to Hillary Clinton before the 2016 presidential election. However, notes Marks, the “left wing of the Democratic Party is becoming a formidable bloc.” Two of Sanders’ fellow members of the Democratic Socialists of America, Alexandria Ocasio-Cortez (pictured) and Julia Salazar – both of whom describe themselves as “radical” – won elections last year in New York. The problem, says Marks, is that “for the 60 years... following World War II, much of the world enjoyed a rising tide of prosperity that lifted all boats”. As a result, most Americans happily accepted capitalism and…

A pay gap is opening up in the banking world, says Financial News. Pay at US investment banks outstripped that at UK and European banks in 2018 – although European bankers are hardly badly off. Junior investment bankers working for European firms were paid between 30% and 46% less than their counterparts at US firms, while vice-presidents got 67% less. At the top, the gap narrowed, but European senior bankers still received 14% less than those at US firms. On the face of it, lower-level staff have higher salaries at EU firms, with associates on £80,000 compared with just £40,000 at US firms, but the US banks’ £90,000 bonus dwarfed the EU firms’ £25,000. EU VPs are on a base salary of £125,000 while US ones are on £110,000; bonuses…

• Investors should keep an eye on funds that could soon shut their doors, says Jonathan Jones in The Daily Telegraph. Funds that get too large sometimes close to new money entirely, or choose to “soft close”, allowing only current investors to put in more money. They do this because performance can suffer when especially large funds can no longer invest in small companies. This situation arises because when funds become enormous, they can only give overall perfomance a boost by taking excessively large stakes in small stocks, which becomes impractical. They then miss out on significant growth from small caps. One fund that could close in the near future is Polar Capital UK Value Opportunities. Its managers are “known for their strict investing philosophy”, which does not discriminate based…

Pension savers taking out income-drawdown plans as they move into retirement are to be offered ready-made investment arrangements, under new proposals from the Financial Conduct Authority (FCA). The chief City regulator is intervening amid fears that many savers are ending up in cash funds that generate no investment growth and actually leave them worse off. Under the FCA’s proposals, savers considering drawdown plans as a way of cashing in their pension funds will have to be offered four default investment plans. These products will be for savers who don’t intend to touch their money for at least five years; those who plan to use their funds to buy an annuity within five years; those who intend “Savers could boost income by 37% by shifting out of cash” The FCA’s proposals…

A loophole meaning parents miss out on the full state pension because of changes to the child-benefit rules could hit more than 200,000 people, says HMRC – far more than previously estimated. The technicality potentially affects couples where one partner commands a higher salary while the other doesn’t earn enough to pay national insurance contributions (NICs), perhaps because they’re staying at home to look after children. Usually, the non-working partner would qualify for national insurance credits, helping to ensure their national insurance record is sufficient to qualify them for a full state pension. However, where the higher earner is the one claiming the child benefit, the credits are never paid to their spouse, as the scheme is administered through the child-benefit system. With savers needing 35 years of NICs to…

David Cicurel, the 69-year-old founder and chief executive of Judges Scientific (Aim: JDG), which designs and produces scientific instruments, must be wondering what the company has to do to win the approval of stockmarket traders. The share price has declined gently over the past few months, even though the company is clearly growing at a healthy clip. In its half-year results published last September, Judges Scientific said it expected profit for the full year, which ended in December, to be higher than analysts had pencilled in. In November it said it expected even more profit, and last month, with the financial year concluded, it raised expectations a third time. References to estimates of future profit are challenging to interpret because companies rarely disclose the figures they expect to meet or…

The simplest way to invest in Asia is through a generalist fund such as Pacific Assets Trust (LSE: PAC), managed by Stewart Investors. This is a fairly diversified fund, albeit biased towards India at present (34% of the portfolio), and focuses on higher-quality businesses. It has ongoing costs of 1.3% and the shares trade roughly in line with the net asset value (NAV) at present. The Schroder AsiaPacific Fund (LSE: SDP) is more biased towards East Asian economies and to cyclical and technology stocks. Ongoing costs are 0.94% and the current discount to NAV is 10% The Scottish Oriental Investment Trust (LSE: SST), also run by Stewart Investors, and the Aberdeen Standard Asia Focus (LSE: AAS) – previously the Aberdeen Asian Smaller Companies Investment Trust – invest in smaller companies.…

The holy grail for investors is a company that can keep expanding sales and earnings for years on end. A crucial driver of long-term growth is research and development (R&D), which determines how many new and improved products and services a company can come up with – and how fast – to maintain or enhance its competitive edge. R&D can give sales, profits and share prices an especially big boost if it leads to the creation of a ground-breaking and wildly popular offering; think what the iPhone did for Apple, or the Walkman for Sony. Fortunately, there is a handy tool for investors to help them identify the companies that should be able to develop and refine their offerings and keep ahead of the game: the annual EU Industrial R&D…

Sometimes a trading technique makes no sense at all but still appears to have a strong track record. A case in point is the Super Bowl indicator. In 1978 the sportswriter Leonard Koppett wrote a satirical column for the magazine Sporting News claiming there was a correlation between the outcome of the Super Bowl, the final championship game of the American football season (a play-off between the winners of two main conferences – the NFC and the AFC) and the performance of the US stockmarket. He noted that for the first 11 Super Bowls after the contest started in 1967, the years in which a team from the NFL won saw a rising stockmarket. Conversely, in years where a team from the AFL triumphed, the stockmarket declined. Over the years…

Aveva (LSE: AVV), the software company, saw its profits before tax for the six months to the end of September increase by 54% from £39.2m to £60.5m, while revenue rose by 11% to £60.5m. The sales growth is due largely to the integration of the industrial software division of its majority owner, French group Schneider Electric, along with some contracts being renewed earlier in the current year than in the previous year. The Cambridge-based business thinks it is will benefit from growing demand in sectors such as cloud computing and augmented reality.…

Robert Allen Stanford was born in Texas in 1950 and made a living running a gym before that failed and he turned to speculating in real estate in Houston in the 1980s. He made his fortune, then moved to the Caribbean island of Montserrat, setting up the Guardian International Bank, then moving it to the nearby island of Antigua and renaming it Stanford International Bank (SIB) to avoid a regulatory crackdown. He also set up a wealth-management firm, which encouraged clients to invest their money in certificates of deposits (CDs, redeemable bonds used by banks) issued by Stanford International Bank. These offered a higher interest rate than CDs offered by US banks, but were supposedly backed by insured assets. How did the scheme work? Instead of being invested in a…

We’re used to seeing watercolours hanging on our walls at home or in galleries. We’re perhaps less used to seeing them as historical records of a world before film. But for many of those painted before the 20th century, that is what they are. Yet watercolour paintings are liable to fade over time and for that reason many are shut away out of sight. A new online initiative launched last Thursday with the support of the Duke and Duchess of Cornwall has set out to change that. A colourful past The Watercolour World (WatercolourWorld.org) project invites museums, galleries and the public to identify watercolours painted before 1900. Using a special portable scanner, the paintings are then digitalised and stored online for the future. “With the world at risk from climate…

Electronic dance-music DJ Marshmello gave us a glimpse of the future of entertainment last week when he performed a concert in front of ten million fans gathered together in the online battle game Fortnite. The game is free to play and the concert was free to attend; the game’s publisher, Epic Games, makes money when players buy items within the game. As part of the gig, Epic made a host of Marshmello-themed items available to buy in-game, including virtual outfits, at a cost of 1,500 “v-bucks” (around £12). Fans can buy clothing in the real world, too, with a Marshmello/Fortnite T-shirt going for $30. Fortnite has around 200 million active players, and generated revenue of $2.4bn in 2018. Good week for: Belfast teenager Dane Gillespie got a surprise when he…

There is an adage that “as January goes, so does the year”, says Tom Stevenson in The Daily Telegraph. But data shows January’s market performance doesn’t actually have predictive power. Between 1984 and 2018, the market rose in January on 19 occasions, and continued to rise 15 times. But on the 16 occasions when the market fell in January, stock still rose throughout the year ten times. “So, the bottom line seems to be that most of the time the market rises.” If you need “midwinter cheer, it’s the market’s... valuation” you should be eyeing up. As Paul Marshall of hedge fund Marshall Wace told the Financial Times, by some measures the British market is the cheapest it’s been in 30 years. The blue chips look a bargain compared with…

Not for the first time, America has “fought a debt bubble by adding on more debt”, says David Rosenberg of Gluskin Sheff. Consumers delevered a tad after the financial crisis, but the state and corporations went on a binge. Total US non-financial corporate debt has hit a record of more than 46% of GDP. Indeed, the chart of corporate debt-to-GDP this cycle looks “a lot like the mortgage debt-to-GDP ratio of a decade ago”. And just as we saw with the mortgage market, the “junky nature” of company debt is a major worry. Half the $6trn investment-grade corporate paper market is made up of BBB-rated debt – the lowest level before it officially becomes junk. The value of the BBB segment has soared fivefold in a decade.…

Adidas is a rare bright spot among German blue-chips, says Der Aktionär. The sports-equipment manufacturer is benefiting from a structural increase in demand as more people try to remain fit and healthy. Research group MarketsandMarkets estimates that the global market for sports equipment will be worth $3.75bn in 2021, compared with $2.73bn in 2015. A marketing campaign with rapper Kanye West, who designs limited-edition trainers, has proved inspired, while Adidas has also been able to tap into the shift away from virgin plastic by incorporating ocean plastic into its trainers. The stock looks good value on a price-to-sales ratio of just 1.5, as opposed to Nike’s 2.3.…

Sony shares have just had their worst fall since 2015, says Bloomberg’s Yuji Nakamura. They slid by more than 8% early this week on news of weaker profits in the PlayStation business in the fourth quarter of 2018, a result of a fall in the sales of the company’s flagship PlayStation 4 console. The declining sales of the “ageing” console is particularly important given problems in Sony’s other businesses, including its “struggling” smartphone division. This increases pressure on Sony to launch the PlayStation 5 successfully in the near future. Sony’s problems are too deep to be solved by a newer console, says Lex in the Financial Times. This is because the fall in PlayStation sales reflects the fact that “faster mobile data means gaming is switching to smartphones”. The question…

It’s 15 months before the next London mayoral election, due to be held in May 2020, and already both the bookies and the betting exchanges are starting to offer some markets on the poll. The current mayor, Sadiq Khan, is, unsurprisingly, the favourite to win re-election. Paddy Power is offering odds of 3/10 (76.9%) on him. It is also offering 7/2 on Conservative Shaun Bailey (22.2%) and 50/1 (1.9%) on Sian Berry, the Green Party candidate. Although Sadiq Khan has come under fire for the rise in knife crime, he is generally popular with Londoners. A December YouGov poll suggests that, on balance, he has a positive approval rating. The same poll suggested he would easily win in the first round, with 55% of the vote, and has a commanding…

What if you could boil down the apparently endless complexity of financial markets to just a few key numbers to watch? Louis-Vincent Gave of research group Gavekal reckons you can. “Four prices matter more than all others, and together these determine the level of global economic activity and of investors’ risk appetite.” So what are they, and what are they telling us about markets right now? The US dollar: the US dollar is the world’s reserve currency. Most commodities are priced in dollars, and dollars are involved in the vast majority of global currency transactions. In short, everyone needs dollars – and so the strength or weakness of the dollar index (which measures the dollar’s value against the currencies of America’s key trading partners) has a big effect on economies…

With its record of terrible service, cattle-truck conditions, and bullying extra charges, there are few companies with a worse reputation. Let’s correct that. There are no companies with a worse reputation. And yet Ryanair’s numbers are fantastic. With a market value of £12bn, it is the largest airline in Europe, overtaking all the old giants in a single generation. Measured by passengers carried, it is the fifth-largest airline in the world; measured by fleet size it is seventh. It is hard to think of another firm that has come from nowhere to take such a commanding position in one of the world’s major industries at such a rapid pace. One of the greats Its founding spirit, Michael O’Leary, is one of the great entrepreneurs of recent times. Ryanair was set…

Britain leads war against superbugs Editorial Financial Times “The world is running out of effective antibiotics,” says the Financial Times. Anti-microbial resistance already leads to around 700,000 deaths per year; this could rise to ten million by 2050. Progress against diseases such as HIV, malaria and tuberculosis (TB) is under threat. The “slow undoing” of one of medicine’s greatest discoveries is in part due to them being over-prescribed. Profit margins have also fallen sharply, causing pharmaceutical companies to redirect their efforts. In the 1980s, when the last new wave of antibiotics was brought to market, there were 25 large pharmaceutical companies with active antibiotic-discovery programmes. Now there are only three. The UK’s new five- and 20-year plans, which include targets for reducing antibiotic use, are steps in the right direction.…

Controlling stakes in investment trusts provide a tax-efficient and convenient way for rich families to manage their wealth. Inevitably, the taxman and listing authorities have imposed increasingly tough rules to reduce tax avoidance and protect external investors, but a number of long-established family-dominated trusts survive. The advantage of investing alongside these families in the likes of RIT Capital, Hansa Trust and Caledonia Investments is that you have the protection not just of directors independent of the fund managers, but also of a large shareholder keeping a careful watch over, if not actively participating in, the affairs of the company. The disadvantage is that the controlling shareholder may be so focused on the long term that they do not care about the discount of the share price to net asset value…

With the average car costing £1,849 a year to run – and steadily depreciating – many of us are looking for ways to keep our car costs down. The good news is there are ways you can turn your car into a money-spinner. “Most cars are parked at home for 80% of the time” Firstly, most of us aren’t getting a lot of use out of our cars. Most cars are parked up at home 80% of the time, according to breakdown company RAC. So one way of making more of your car is to rent it out to your neighbours. Peer-to-peer car sharing sites such as Hiyacar, Drivy or Turo allow you to create a listing and rent your car out in return for a share of what you…

HMRC has paid £402m to 174,000 savers (an average of £2,312 each) after applying an emergency tax code to the amounts they took from their pension funds, says Carol Lewis in The Times. Under pension freedoms, people over the age of 55 can take out up to 25% of their pension fund without incurring tax, with additional withdrawals taxed at their marginal rate of income tax. Yet that first withdrawal is taxed using an emergency income code, meaning HMRC taxes it as though the first withdrawal is the first monthly payment of 12, signalling a new level of annual income. The person then has to reclaim the overpaid tax. To avoid having to reclaim this tax, consider making a token withdrawal of £1 at first – this shouldn’t trigger a…

In a court case last year, a London-based leaseholder was found to have breached the terms of his lease by renting out his flat through the short-term letting site Airbnb. The County Court ultimately decided there had been a breach of the covenants in his lease that said he wouldn’t sublet the flat without prior written consent of the landlord, and that he would only use the flat as a residential home for one family. Although there’s decent money to be made from letting out property via Airbnb, the lesson here is clear: to save headaches later on, make sure you first get the okay from everyone with a relevant interest in your property. You need permission first So first, and probably most importantly, check that letting your home out…

Income investors looking forward to a brighter 2019 of higher yields and rising interest rates might have to adjust their expectations. I suspect the interest rate available on savings probably won’t rise by much. In fact, it looks as though central bankers, led by those in the US, might slow down or even end rate hikes this year. As a result, income investors might be left desperately scrabbling for yield, yet again. So why might income-producing assets remain overvalued and low yielding for the forseeable future? It’s down to what I call the “Lower for Longer” scenario. A few years ago, I did an informal survey of some banking analysts. I asked when they thought rates would head back towards the long-run average of around 5%. Many answered “never” –…

This has been a good week for my four open long positions. All of them have risen, although only by a small amount in most cases. For example, Greene King went up from 596p to 599p, Cineworld climbed from 257p to 260p and John Laing increased from 351p to 354p. The best performer was JD Sports, up from 437p to 450p. While Hays also increased to 157p, this is below the 160p level needed to trigger the trade. Overall, the four open positions are now making a collective profit of £753, up from £554. The performance of my shorts has been more mixed. Bitcoin fell slightly in value to $3,411, while Weis Markets also declined from $49.07 to $48.78. Rightmove was also unchanged at 477p. However, the four other short…

Debenhams (LSE: DEB), the struggling department store, is sitting on net debt of £268m after a disappointing Christmas followed three profit warnings in 12 months. At the beginning of this year, the chain’s chairman and chief executive were ousted from the board after two of the biggest shareholders, including Mike Ashley’s Sports Direct, voted against them. Debenhams is now in talks with lenders as part of an attempt to bring in new sources of funding. The chain will struggle to refinance its debts if it doesn’t attract new cash, said credit-ratings agency Moody’s.…

• While helping to pack food parcels for sex workers for a charity last week, the Duchess of Sussex pulled out a marker pen, says Liz Jones in The Mail on Sunday. Surely she wasn’t going to do anything as crass as sign her autograph, was she? No. On each banana, the duchess carefully wrote a self-help message – “You are loved”, “You are strong”, each one punctuated by a little love heart. “Awwwww.” But the scribbled-on bananas change nothing. “I’d have more admiration for her if, when she’s finished doing up that ‘cottage’ in Windsor Great Park with the help of the interior designer from Soho House, she were to open its doors as a refuge instead. That would show these women that they are loved. That would prove…

Ever since Alan Greenspan presided over the US central bank in the 1980s, markets have been able to count on the “Fed put”: the US Federal Reserve’s tendency to shore up the stockmarket whenever investors are feeling rattled. And it seems the current chairman, Jerome Powell, is no exception. Following December’s sell-off, he went out of his way to placate liquidity-addicted markets last week. Not only did he suggest interest-rate rises in the US might be off the table this year, but he also indicated he is open to adjusting the pace of quantitative tightening (QT, the withdrawal of liquidity from the system by selling bonds previously bought with printed money). Only six weeks after it raised interest rates, it seems the Fed is wary of strangling growth by hiking…

“The current system of business rates is crushing the life out of the high street while handing a big competitive advantage to online retailers with little in the way of a physical presence. This imbalance needs correcting… to my mind the best response to the challenges of the digital age would be to shift from a tax based on property to one levied on sales. Today’s savvier retailers are often a mix of online and physical, in symbiotic relationship with one another. A small levy at point of sale, or alternatively with online sales at point of delivery, would allow similar levels of revenue to be raised at local level for local use. In any case, the tax treatment of Amazon and the high street would end up exactly the…

Three to buy Centamin The Sunday Times Shares in this Egypt-focused gold miner have tumbled over the past year as production has disappointed. But there are now signs of improvement: output was up 17% over the previous quarter during the final three months of 2018. With an undemanding forward price-to-earnings (p/e) multiple of 10.9, those with an “appetite for risk” could “dig for treasure”. “There’s no better... shelter” from today’s “barrage” of global shocks than gold. 118.4p GlaxoSmithKline The Daily Telegraph Plans announced in December for Glaxo to merge its consumer healthcare division with America’s Pfizer have transformed the investment case for this pharmaceutical giant. The creation of the new consumer entity, which will be demerged within three years, will enable the pharmaceutical operation to clear debts and invest in…

• Swiss private bankers are supposed to maintain their composure “even if the world is collapsing around them”, says Lex in the Financial Times. But those working for Julius Baer “must be perspiring lightly under their finely tailored suits”. The shares have slid by 40% in a year, and last year profits “missed expectations”. Baer’s large number of Asian clients means the bank “is more exposed than rivals if newly created billionaires have less money to stash” as the result of a Chinese slowdown. Management’s insistence that “the growth story remains intact” rings hollow. • HMV, which went into administration just before the end of last year, “survives to live another day”, says AJ Bell’s Russ Mould. Its purchase by Canadian group Sunrise Records will ensure that “the iconic British…

The price-to-sales (p/s) ratio is the market capitalisation of a company divided by its revenues. So a company that has a market value of £25bn and sales of £10bn has a p/s ratio of 2.5. This is sometimes also known as a “sales multiple”. All else considered, the lower the number, the cheaper the stock. The p/s is calculated in a similar way to other metrics such as the price/earnings (p/e) ratio (market capitalisation divided by profits). But of course, sales aren’t the same as profits, so the p/s may at first glance appear less useful as a gauge of whether a firm is cheap or not. However, it can be a helpful tool when looking at firms or sectors where earnings are temporarily depressed as a result of one-off…

• The English Premier League and its 20 member clubs are having a tough time finding a new chief executive to replace outgoing head Richard Scudamore, reports the Financial Times. The league had lined up Susanna Dinnage from US media company Discovery, but she pulled out without explanation before Christmas. One senior club executive said the problem was that the league was “not paying enough”. Scudamore was on a base salary of £900,000. With bonuses, his pay was nearer £2.5m. He got a £5m golden handshake when he retired. • The highest-paid player in this year’s NFL Super Bowl American football game – won last Sunday by the New England Patriots – was Aaron Donald (pictured) of losing side the LA Rams. Donald was paid $22.5m this year, including salary,…

“Sir Alex Ferguson gave me advice on contract negotiation – don’t rush and don’t undervalue yourself. I may not always have followed it, but it’s not a bad name to drop in the middle of a meeting.” BBC TV presenter Clare Balding (pictured), quoted in the New Statesman “The reason Google and Facebook are two of the most profitable companies ever is because they are creating all this damage and not paying for it. Exactly as coal companies never paid for the pollution or health consequences of what they did. They are only great businesses because they have not been held to account.” Roger McNamee, early Facebook investor and former adviser to founder Mark Zuckerberg, quoted in The Times “I was just too busy — my first maid left, my…

In a move to placate investors, eBay will introduce a dividend and increase share buybacks, says Shannon Bond in the Financial Times. The online marketplace will begin paying a quarterly dividend of 14 cents per share, and plans to return around $7bn to investors over the next two years, mostly through $5bn in share buybacks in 2019, it says. The news came a week after notorious activist fund Elliott Management wrote to eBay’s board, suggesting it needed to regain investors’ confidence by selling some of its businesses, refocusing on the core retail platform, and returning more cash to shareholders through repurchases and a dividend. Elliott revealed last week that it had invested $1.4bn for a 4% stake in the company, which has also been facing similar demands from activist fund…

The minimum investment for Premium Bonds has been slashed for the first time in 63 years. The government-backed National Savings and Investments (NS&I) will now allow you to start saving with just £25, compared to the old minimum of £100. NS&I hopes the change will encourage people of all ages to invest small sums on a regular basis, with regular standing orders for £25 now permitted. Premium Bonds have long been the nation’s favourite choice for cash savings, with £79m currently invested and 21 million of us holding bonds. That’s despite the fact that you earn absolutely no interest on your money. Instead, your bonds are entered into a draw to win cash prizes of between £25 and £1m each month. The average investor should win enough prize money to…

Thousands of people wrongly advised to transfer their pensions have not been compensated or even warned that they may have been disadvantaged, the City regulator has conceded. The Financial Conduct Authority (FCA) said some 5,000 pension transfers had been carried out by 19 firms of financial advisers that quit the market after it uncovered concerns about the quality of their advice. However, while the FCA conducted a sampling exercise that found fewer than half the recommendations made by firms it looked at were suitable, it has failed to contact all the savers who transferred funds following dealings with the 19 firms. Consumer groups such as the Financial Inclusion Centre are calling for the FCA to contact all savers potentially affected, amid concerns that many may have no idea that there…

The week marks the start of the Year of the Pig in the Chinese zodiac. Pigs symbolise prosperity and good fortune – but there’s little good news coming out of Asia at present. China’s economy is slowing abruptly; the government last week began recapitalising banks in an effort to get them to lend more and support consumption. The outcome of India’s general election in May is highly uncertain, increasing the risk of erratic policymaking as the ruling party tries to shore up support. Other major economies are also weakening: South Korea expanded at the slowest rate in six years in 2018. Some data still looks encouraging: GDP growth of 6.2% in the Philippines is not to be sniffed at. Yet even that represents a slowdown. The general trend across the…

Anand Giridharadas, 37, is an author, and a former columnist and foreign correspondent forThe New YorkTimes. He was born and raised in Cleveland, Ohio, and educated at the University of Michigan, Oxford, and Harvard. He worked briefly as a consultant for McKinsey & Co in Mumbai, before becoming a journalist in 2005. He appears regularly onTV and radio, and is an on-air political analyst for MSNBC. He teaches journalism at NewYork University and lives in Brooklyn, NewYork. His latest book, WinnersTake All:The Elite Charade of Changing the World (2018, Penguin Random House), looks at how the global elite preserve their privileged positions while paying lip service to solving global problems they helped to cause in the first place. He has written two other books: TheTrue American (2014) and India Calling…

Marie Kondo is making a fortune by getting people to cut down on their possessions. But where is all the stuff going? Straight into storage, it would seem. Enter Safestore Holdings, a real-estate investment trust that rents out lockers and self-storage units to a wide range of clients, from businesses to private individuals. It runs 146 stores in Britain and France, split between London, north-west England and Paris, where it operates 22 stores. Safestore’s growth stems from three key factors. It has been opening new stores to catch up with demand and has also acquired stores from rivals that it has taken over, including Alligator Self Storage in 2017. It has also become better at finding customers for its existing premises, gradually increasing the occupancy rate from 60% in 2011…

The British and Indian stockmarkets have much in common. The FTSE 100’s constituents make most of their sales abroad, while the same applies to India’s big-caps in the BSE Sensex 30. The index does not accurately reflect the real state of the domestic economy, so investors seeking exposure to India often find they have unwittingly bought into broader global trends rather than local spice. As in the UK, the area of the listed market that best reflects the performance and prospects of the local economy is the small-and mid-cap segment. This is the engine room of both economies, though in India’s case overall GDP growth is nearer 8% than the UK’s 2%. Over the last 15 years, India’s mid-cap equity index has averaged impressive annual returns of 12.3% in US…

For an impressive sight, head to Augill Castle, near Kirkby Stephen in Cumbria. It is a monument to sibling rivalry, says Hattie Garlick in The Daily Telegraph. John Bagot Pearson, a local gentleman, built it in 1841, picking the location because it overlooked the farm his brother Alexander inherited from their parents. “He chose the design because – well, how do you top a castle?” The jealous brother “really went for it too”: the neo-Gothic folly still features its original turrets, towers, battlements, and stained-glass windows, and there are “vast” oak doors and “azure vaulted ceilings flecked with gold stars and edged by inscrutable golden faces”. “If it’s… an excuse to wear fake fur and a working fireplace in a fourposter bedroom that you’re after, then the Pendragon in Augill…

Last week I wrote about the predictability, or otherwise, of New Zealand’s most famous vinous export, Marlborough sauvignon blanc. This week I would like to introduce you to a discipline that represents a fraction of 1% of the country’s harvest – syrah. Of course, Australia is a syrah/shiraz hero-producer and New Zealand will never compete in quantity or absolute quality, but it has a style all of its own, as a result of its climate, and it is a style that the Aussies are increasingly chasing in their own cooler spots, too. Harking back to the flavours associated with the energetic syrahs from the Northern Rhône, such as Cornas, Crozes-Hermitage and Saint-Joseph, the wines from Hawke’s Bay are usually medium-weight (unlike the warmer-climate Aussie versions), aromatically invigorating with pepper, herb…

A rare miniature portrait of King Henri III, who ruled France from 1574 to 1589, by celebrated English artist Nicholas Hilliard, is to appear at the National Portrait Gallery’s exhibition, Elizabethan Treasures: Miniatures by Hilliard and Oliver , from 21 February to 19 May in London. The tiny painting had been catalogued as being from the “19th century” when it was auctioned in France in 2013. However, miniatures expert Emma Rutherford dated it to 1570. It is estimated to be worth at least £750,000. “In terms of miniatures, it’s like unearthing the biggest diamond you’ve ever seen,” she told the Evening Standard last week. “You cannot believe this has been hidden, not commented upon, not ever before exposed as the wonderful Renaissance portrait that it is.” It’s…

Regular readers may remember our Grand Strategic Plan: we buy stocks when they are cheap relative to gold; when they are not cheap, we keep our money in gold. This week, we let you in on another of our plans. “Buy when blood is running in the streets,” was the advice of some ancient Rothschild. We would add that you need to make sure it’s not your blood. Which is what had us a little concerned when we arrived in Managua, the capital of Nicaragua, recently. An estimated 300 people have died in demonstrations against the government there. To hear the locals tell the story, hundreds more have been “disappeared” by death squads working for President Daniel Ortega. “Buy when there’s blood on the streets. Just make sure it’s not…

14m The price in Indonesian rupiah (£765) for a rare J-Queen variety of durian, the famously pungent fruit that is considered a delicacy in southeast Asia. The average monthly wage in Indonesia is 3.9m rupiah. 15 How many tonnes of gold were sold by Venezuela to the United Arab Emirates last Friday for an unspecified amount of euros in a bid to boost its cash reserves, says The Times. Three tonnes were sold in January, and another 11 tonnes will follow this month. The sales represent around a fifth of the troubled country’s gold reserves. 12 The percentage of car sales in 2030 that will be made up of self-driving taxis, analysts at investment bank UBS estimate. Revenues from so-called “robotaxis” are expected to be $1.3trn-$2.8trn. Global car sales stand…