Innehållsförteckning för 1149 från MoneyWeek

Plenty of fund managers will have had some sleepless nights recently, but not Fundsmith’s Terry Smith. “I never invest in bank shares,” he says in the Financial Times. Banks need too much leverage to make an “adequate return”. NatWest, for instance, has £5 of shareholders’ equity to finance £100 of assets, so it is geared 20 times; the average company in the US blue-chip index, the S&P 500, is geared three times. Around 52% of NatWest’s assets are made up of loans. All it takes to wipe out the equity, then, is for 10% of the loans to go bad. Before that happens depositors will notice the problem and trigger a run on the bank. Cue the next problem, says Smith: a panic can infect perfectly healthy banks. He tells…

“The willingness of financial television shows to bring back... pundits who aren’t very good at picking stocks seems almost endless... Now, though, investors are being offered the chance to... bet on [investing] stars’ comeuppance through [specially designed] funds... This month’s launch of the Inverse Cramer Tracker ETF... which bets against CNBC Mad Money star... Jim Cramer, started with a flurry of interest. Another product betting against fund manager Cathie Wood’s once-highflying ARK Innovation ETF... launched in late 2021 as her fund was on its way to a 75% crash... But [even if the pundits are wrong, there] is also... reason for caution when betting against them. For example [the fund betting against ARK Innovation] lost nearly a quarter of its value in January as beaten-down [tech] stocks favoured by Wood…

Kingfisher, Britain’s largest DIY chain and owner of B&Q and Screwfix, has reported a 40% slide in pre-tax profits to £611m in the year to 31 January as “Britons scaled back on home improvements after the pandemic”, says Isabella Fish in The Times. Kingfisher said its performance reflected the fact that the company had been a “lockdown winner”, taking advantage of the fact that many people moved house, while “many of those who stayed put carried out home improvements”. Kingfisher may have gone “from a pandemic darling to a relative struggler”, but at least it managed to beat low expectations for sales and profits, says Adam Vettese, an analyst at social investing network eToro. However, it’s impossible to deny that the company “has regressed on nearly every key financial metric…

Profits fell by 40% at SKF last year, notes WirtschaftsWoche. But this was due to one-off costs resulting from its withdrawal from Russia. Business is booming at the Swedish manufacturer of bearings, seals and lubrication systems, all of which are crucial to producing electric vehicles, solar panels, wind turbines – and keeping high-speed trains moving. Orders from the car industry, which comprises a quarter of overall sales, are rising at a 7% clip. A joint venture with China’s wind-turbine maker Goldwind looks especially promising, while SKF is also active in India, the world’s fourth-largest renewable-energy market. Net income should jump by 25% to €500m this year, while the stock yields 3.5%.…

Politics & economics Last week’s Toyko summit between South Korea’s Yoon Suk-yeol and Japan’s Fumio Kishida – the first visit to Japan by a South Korean president in 12 years – was a sign that concern over North Korea’s “frequent missile launches” and China’s growing assertiveness has led to a rapprochement, says Al Jazeera. On Tuesday, South Korea announced its decision to fully restore a military intelligence-sharing pact between the two countries, known as GSOMIA, which Seoul threatened to withdraw from in 2019, says The Japan Times. Yoon also told officials to put Japan back on the “white” list of trusted partners qualifying for “preferential treatment in export procedures”. Tensions between Japan and South Korea, which was occupied by Japan between 1910 and 1945, have “long undermined US-led…

The outcome of the contest to succeed Nicola Sturgeon as leader of the Scottish National Party and Scotland’s first minister will be known next week. At the moment punters are convinced that health and social care minister Humza Yousaf will emerge as the winner. With £161,208 matched on Betfair, Yousaf is favourite at 1.23 (81.3%). Finance and economy minister Kate Forbes is at 5 (20%) and Ash Regan out at 60 (1.7%). As readers of this column will know, I previously tipped Angus Robertson to be the next SNP leader, only for him almost immediately to rule himself out of the contest, so I’m not going to make another prediction. Still, it’s clear that whether it is Yousaf, Forbes, or even Regan, they will find it a big challenge to…

When the end came for Credit Suisse, it was very sudden. The bank had been in trouble for years, mired in scandals, and with a management team that seemed to make every mistake possible. With interest rates rising around the world, and depositors fleeing any bank with any question mark over its future, it ran out of both time and money. Even CHF50bn (£45bn) from the Swiss National Bank was not enough to stabilise it. The game was up. The hastily arranged marriage with UBS was perhaps the best solution. It stopped a messy collapse, and there is at least a slim chance that a stronger bank will emerge from the combination. There are two big problems with the deal for Switzerland, however. A shabby deal for investors The first…

“Marking to market” simply means updating the value of an asset or a portfolio of assets to reflect the latest available prices for said assets. This is easy to do when assets are publicly listed, highly liquid (easily bought and sold) and fungible (substitutable for one another). For example, FTSE 100 shares trade in huge quantities on a daily basis, so you can be very confident of the value of any shares in your portfolio simply by referring to the market price at any given moment. It’s harder when transactions are less frequent, assets are not fungible, and the sales process is more involved, however. For example, you might have a rough idea of what your house is worth – and estate agents and surveyors will certainly give you an…

“I’m from the government and I’m here to help.” The nine most terrifying words in the English language, according to Ronald Reagan (pictured), quoted in The Sunday Times “There’s an old saying: ‘Whenever the Fed hits the brakes, someone goes through the windshield’. You just never know who it’s going to be.” Michael Feroli, chief economist, JPMorgan, in The New York Times “If you assume all money (ie, everyone’s earnings) morally belongs to the government, you see a decision not to tax as being the same as a gift (or “bung”). A donation, from the rightful owner. It’s right/normal for Labour to use such language. What’s new is how many Tories also do so. Same as “unearned income” as a pejorative for investment income.” Fraser Nelson, editor of The Spectator,…

vox.com Sorry can often seem the hardest word for a reason, says Allie Volpe. It may feel like you’re harming your reputation, or admitting you’re a bad or unjust person, or admitting defeat and hence lowering your social status. When someone is upset with you, it’s easy to shift into “self-protection mode”. But a successful apology can bring people closer together and improve your standing with the wronged party. Close listening and true sincerity are the real secrets to a successful apology. But these simple rules of thumb will help too. 1. Actually say that you’re sorry or that you apologise. 2. Specify what it is you’re apologising for and show that you understand why your actions were harmful or hurtful. 3. Don’t make excuses, but offer an explanation if…

Troubled online retailer THG is now facing pressure from a second activist investor, says The Sunday Times. Sparta Capital, a UK hedge fund set up by a former portfolio manager at top activist Elliott, has recently taken a stake in the e-commerce group, whose shares have fallen 93% since it listed in 2021, “amid concerns over governance and tough trading conditions”. Sparta joins Kelso, which disclosed a 0.4% stake in January and is thought to be about to go public with its recommendations, which include moving THG’s listing to the premium segment of the London Stock Exchange. A premium listing would require founder and CEO Matt Moulding to give up his golden share, which currently gives him the ability to veto hostile takeover bids.…

● “Tens of thousands of young adults are missing out on £2,700 in ‘free money’,” says Rachel Mortimer in The Telegraph: £400m is sitting in Child Trust Funds (CTF) that were set up between September 2002 and January 2011. The accounts were opened by the government and each child received around £250 each. Parents and grandparents could contribute, but many didn’t, and the accounts were simply forgotten about. The money couldn’t be touched until the child turned 18, which began happening in September 2020. Around 320,000 accounts had matured by April 2021. Almost half had not been claimed by their owners, according to the National Audit Office. You can check if you or your child has a forgotten CTF by contacting HMRC, who can tell you where the account was…

Some of the biggest beneficiaries of all from the Budget may be those inheriting cash and assets from their families. Experts expect the chancellor’s reforms to be exploited as a huge inheritance-tax (IHT) planning opportunity. That’s because pensions do not usually count towards your estate for IHT purposes. Money in your pension can be passed on completely tax-free if you die before the age of 75; if you die after 75, your heirs pay tax on the money in the same way as income when they make withdrawals. For families facing an IHT headache, getting rid of the lifetime allowance therefore creates a golden opportunity. The more wealth they can move into pension plans, the less tax they’ll ultimately have to pay. This is all the more important given the…

Now is a great time to bargain hunt in the UK commercial property market. Unlike residential property, where prices have gone up since the financial crisis, commercial property values have been far more volatile. Retail and office properties have collapsed in value, particularly in regions outside London. Even the sectors that have fared relatively well over the past decade, such as out-of-town logistical properties, have started to come under pressure over the past year as the Bank of England has ratcheted interest rates higher. At the end of February, the largest UK-listed real-estate investment trusts (Reits) were trading at an average discount to net asset value (NAV) of 13%, according to analysts at investment-banking group Stifel, suggesting the market believes property values (and as a result NAVs) will decline further.…

As you might expect, it hasn’t been a good fortnight for my long tips, with all but one falling. Retailer Dunelm decreased from 1,283 to 1,131p, luxury clothing retailer Burberry fell from 2,500p to 2,349 and telecoms operator Gamma Communications went down from 1,213p to 1,105p. Estate agent Savills also declined, from 994p to 966p, while online retailer Asos fell from 957p to 747p. Discount retailer B&M Value Retail depreciated from 495p to 473p. Online-streaming service Netflix fell below the stop-loss of $300. The only exception was builder DR Horton, which rose from $91.84 to $96.84. Overall, counting Netflix, my long tips are now making collective net profits of £2,754. The silver lining is that all my five short tips moved in my favour. Real-estate investment trust Digital Realty fell…

Nick Leeson was born in Watford in February 1967 and after doing his A-levels he became a clerk at Coutts bank. He moved on to a support role at investment bank Morgan Stanley, and ended up at Barings Bank. At Barings he became involved in an investigation into an employee who had used a client account to carry out unauthorised trading. Having done well in this role, Leeson was promoted to the head of Barings Futures Singapore (BFS), where he was responsible for “front office” trading decisions, as well as providing administrative support. What was the trade? The main duties of BFS were flow trading (carrying out client orders) and arbitrage (trying to exploit small differences in price between the Singapore and Japanese markets). Leeson decided, without Barings’ permission, to…

2018 Yalumba, The Signature Cabernet Sauvignon Shiraz, Barossa, South Australia £37.99, reduced to £33.99 per bottle in a Mix Six, Majestic.co.uk Last month, history was made with an extraordinary and unprecedented result in the 2023 The Great Australian Red competition. The soon-to-be-released 2018 Yalumba The Caley Cabernet Sauvignon Shiraz (2016 The Caley is £201, fareham winecellar.co.uk) became the first four-time winner of TGAR. The 2012 vintage of The Caley became the first wine in the competition’s history to win the top trophy twice when it was anointed The Great Australian Red 2014 and 2015. It then became the first to win three times when the 2016 vintage was awarded The Great Australian Red by a UK judging panel in London last August. Interestingly, the 2018 vintage was also in the…

On Burns Night, at the end of January, I found myself holed up inside the Tower of London on a wet and blustery evening. My fellow whisky enthusiasts and I had come together to toast the Speyside Distillery’s limited-edition Spey Royal Choice at a tasting organised by cask whisky specialists Cask Trade. A few weeks later, I found myself talking to Cask Trade’s founder, Simon Aron, on a sunny Friday morning at the firm’s offices on Regent Street. It is like a sweet shop for adults. Rows of toffee- and caramel-coloured whisky samples line the shelves, a few tantalisingly labelled “Secret”. I ask Simon what that means. He says he’ll tell me later. Repairing to the tasting room, I tell Simon how I had ended Burns Night tipsily talking to…

An unnamed influencer on OnlyFans received tax relief on breast surgery after successfully arguing that it was a legitimate business expense, says The Mail on Sunday. HM Revenue & Customs allows self-employed entertainers to claim relief on cosmetic surgery if it was done for professional purposes, and a test case in 2003 ruled that a radio broadcaster could claim for getting his teeth straightened after landing a job on television, but this is the first reported case involving breast enhancement. OnlyFans, an online platform where users pay to access work from content creators, is primarily used for adult content, but also hosts other performers. Love Island star Megan Barton-Hansen (pictured) has reportedly made £1.5m from the site in the past two years. She spoke of having a breast operation in…

“The planets are aligning again for gold,” says Étienne Goetz in Les Echos. Prices topped $2,000 an ounce on Monday for the first time in a year. The yellow metal last exceeded $2,000 on 10 March 2022, just after Russia’s invasion of Ukraine. The latest rush into gold, a traditional safe-haven, shows that investors have reacted to the banking panic with similar alarm. It also reflects bets that the US Federal Reserve will be forced to slow interest-rate increases while going easier on inflation. That is a favourable set-up for gold, which has been squeezed over the past year by competition from rising US bond yields. Gold pays no interest or dividends, but that becomes less of a drawback when real interest rates (interest rates adjusted for inflation) are on…

Brent crude prices have fallen to a 15-month low amid concern that the banking turmoil spells trouble for the wider economy. The key oil benchmark was trading above $120 a barrel as recently as June last year, but has since slipped by 40% to $72 a barrel. Forecasters had expected a strong year for oil, with China’s reopening reviving demand, says Ruxandra Iordache for CNBC. Goldman Sachs’s analysts had predicted that Brent would hit $100 a barrel within the next 12 months, but have now cut that target to $94 amid “banking stress, recession fears, and an exodus” from the oil futures market. Falling tensions in the Middle East after this month’s Saudi-Iranian deal to re-establish diplomatic ties have also helped deflate oil prices.…

The future of John Lewis is up in the air, says John Arlidge in The Times. It is reportedly contemplating selling a minority stake in the partnership to private investors in order to raise up to £2bn. The move “would mark the end of Britain’s most successful 100% employee-owned business”. John Lewis, which owns Waitrose, has revealed a pre-tax loss, including property writedowns, of £234m in the year to 28 January, with sales slipping by 2%. As a result, the partnership bonus for the group’s 74,000 workers “was scrapped for only the second time since 1953”. Already, one in three of John Lewis’s 51 stores has been shut, while staff numbers have been cut by 4,000. Tampering with John Lewis’s partnership model “would be a huge mistake”, says Gemma Goldfingle…

China’s online fast-fashion group Shein, “the shopping destination of choice for Generation-Z consumers in the West”, hopes to launch one of the biggest Chinese initial public offerings (IPOs) in the US this year, says the Financial Times. It is to raise $3bn at a valuation of $64bn, a far cry from the $100bn it mustered in its latest funding round in April 2022 – a reflection of investors’ growing scepticism towards tech start-ups. The group is trumpeting its intention to boost sales from $22.7bn last year to $58.5bn in 2025, more than the combined annual sales of retail giants H&M and Zara. But Gen-Z is notoriously fickle and “a series of imitators” could also hamper growth.…

London Inflation rises again: Consumer prices rose unexpectedly in February from a year earlier, by 10.4%. That is below the 11.1% recent peak in October, but higher than January’s 10.1%. Food and alcohol were the main drivers, with those prices rising by 18.2% over the previous 12 months at the fastest pace in 45 years, “partly due to the recent supply shortages”, says Paul Dales of Capital Economics. “Food inflation will surely soon fall, but at the moment it is still a painful upward influence on inflation that everyone has to bear.” Annual fuel-price growth, on the other hand, eased from 7.7% in January to 4.6% last month and the “recent fall in the oil price to $75 per barrel means further falls are on the way”. Even so, core…

● ”The London market is hardly awash with profitable tech stocks, typically opting for bombed-out, jam-tomorrow wannabes,” says Alistair Osborne in The Times. Cybersecurity firm Kape Technologies is a rare exception: last week’s results showed revenues up 170% to $624m and profits up 203% to $70.9m. So it’s regrettable that it’s probably on its way out to a “low-ball bid” from investor Teddy Sagi (pictured) who owns 54.8%. The board says the offer – $3.44 (280p) per share, against 288p now – materially undervalues Kape, but “they have a lousy negotiating hand”. Sagi plans to call an extraordinary general meeting to delist Kape regardless of the outcome of his bid. Delisting requires 75% of votes, but the gambit will probably see his bid accepted, since other investors won’t want to…

Albert Edwards, global strategist, Societe Generale One of the most important consequences of the turbulence in the banking sector is that investors clearly no longer believe that central banks can continue to tighten policy, says Albert Edwards, the long-time bearish strategist at Societe Generale. Markets are now starting to price in significant cuts in interest rates, despite uncertainty about whether they will be able to cut aggressively while the consumer price index (CPI) continues to rise. However, oil prices have slumped – down 5% in one day last week – which is being widely attributed to fears of a global recession caused by a banking crisis. It’s less widely noticed that industrial commodities have struggled more broadly, “despite the promise of a reviving Chinese economy”. Metals are down by 30%…

unherd.com/thepost When Liz Truss was prime minister, she proposed giving parents money to spend on childcare as they wished, says Dan Hitchens. It was a libertarian brainwave that “actually promised to make people more free”. Now, the Tories are “clamping down”. Jeremy Hunt’s plans, which will guarantee 30 hours a week of free childcare for one- and two-year-olds, is all about getting more people back to work. Hunt’s is a “one-size-fits-all” model in which parents are expected to work full-time and entrust their children to providers. But that is not what the public wants: the British Social Attitudes Survey found that only 6% of British people think that both parents should work full-time. The CBI, the bosses’ union, led the lobbying for this reform, and it would have you believe…

■ The chair of Scottish Mortgage Trust, Fiona McBain, is to stand down and a director has been removed after “a rare public bust-up over corporate governance” at the £13.4bn investment trust, says the Financial Times. Amar Bhidé, a business academic who has served as a non-executive director since 2020, told the paper that he had been asked to resign after clashing with McBain, who has been a director since 2009 and chair since 2017. The row centred on the criteria for appointing two new directors, and on the risks presented by SMT’s unquoted investments, which total £3.8bn of the portfolio. “In my opinion [the trust’s team] do not have the capabilities and governance clout to be able to monitor the illiquid investments on which there is little audited information…

Financial advisers believe that more than one million savers will benefit from Jeremy Hunt’s Budget reforms to the rules on pension savings. While last week’s changes have been criticised as a handout to the rich, savers on more modest incomes will also benefit, particularly those in defined-benefit (DB) plans. Hunt insists his headline pension reforms are all about addressing problems that are limiting the number of people in the workforce. There has been a particular problem in key public-sector roles such as medicine, although the new rules will apply to everyone, regardless of their occupation. One problem has been the annual allowance on pension contributions – in particular, the rising value of benefits in DB schemes, which guarantee a set level of pension. In recent years, the yearly allowance has…

Time for a paper chase? UK chancellor Jeremy Hunt may believe that the country will avoid a recession, but indicators such as the shrinking money supply and the overall consumer confidence downtrend are less bullish. Add in some bank failures that have just been announced – remember what happened in the great financial crisis 15 years ago – and it is easy to see why equity markets are very jittery about another economic contraction. Many shares in cyclical industries (those where sales and profits are closely tied to the economic cycle) have been crushed. The paper and packaging sector typifies this. If demand for goods declines, there is less need for something to wrap them in. FTSE-100 member Mondi (LSE: MNDI) is a global packaging and paper leader, employing 22,000…

Over the past few years interest in solar power has surged. With costs falling and the technology improving, many people see it as the energy of the future. One company involved in the solar boom is Sunrun (Nasdaq: RUN). This Californian outfit focuses on developing solar systems, including both panels and storage, that can be used by households. However, while its shares soared a few years ago, rising sixfold during 2020, they have since crashed to Earth, falling back to little more than their flotation price. They now cost $18. So is this a good time to buy, or will they fall further? I believe that they will continue to slide as Sunrun faces two major challenges. Firstly, the company benefited hugely from a scheme by the Californian government to…

“Conventions are returning to Las Vegas, which bodes well for MGM Resorts” One of the consequences of the dominance of the mega-cap growth stocks in the US over the last decade or so is that there is a huge amount of concentration risk. Many funds own the same stocks because they use the same investment process, which is to buy growth stocks, no matter where we are in the economic cycle. The VT Tyndall North American Fund takes a different approach. It looks first at where we are in the business cycle, and then constructs the portfolio accordingly. There are times when growth as an investment style does not work – 2022, for example – and it is important to avoid periods of major stockmarket declines in order to bolster…

I’m not much of a tourist. Give me a sunny Caribbean beach and a good book and I’m happy. But just for a change (and because my eldest daughter is getting married, meaning we had but little time), we thought we’d go somewhere closer at hand and escaped to Marrakech in Morocco. It’s an extraordinary, rather bewildering place, right on the edge of the Sahara desert and refreshingly warm after England, yet majestically framed, in the distance, by the snow-covered Atlas mountains glowing in the sun. Sweeping through the wide avenues, you’re struck by how strikingly pink it is, this “Red City”. The pink stone is all around you in the interminable high walls which stretch round the city, and in its many lustrous palaces. We visited one of these…

“Here we go again,” says Jeremy Warner in The Telegraph. “Little more than a decade after the financial system last went belly up,” we are once again “peering over the cliff edge into the abyss” of another banking crisis. As the rescues of Credit Suisse (see page 16) and US regional banks demonstrate, “whatever the safeguards, however big the required capital and liquidity buffers, when push comes to shove… beleaguered governments” have little choice but to ride to the rescue of bankers in distress. Banks are better capitalised The problems in today’s banking sector are “totally different from the issues of 2008”, says David Buik on LBC. Post-crisis reforms mean “banks now require almost ten times the amount of capital to do the same level of business they did 15…

The fate of First Republic, a San Francisco-based bank catering to high-net-worth individuals, “hangs in the balance”, say Rob Copeland and Maureen Farrell in The New York Times. The share price crashed by 50% on Monday, and is down 90% in three weeks. Until recently the bank “boasted $176bn in deposits and an enviable list of wealthy clientele”. But last week’s bank collapses triggered a crisis of confidence in First Republic, which has lost $70bn in deposits in recent weeks. A “mix of short-term fixes” has failed to stop the panic. These fixes included the decision of large US banks to inject $30bn in deposits into First Republic last week as part of a rescue package, says Callum Jones in The Times. But anxiety over its liquidity “continued to loom…

Four to buy Shares This engineering-services group has endured a fraught few years but is now embarking on “a major recovery”. Disposals have refocused the business on the defence sector, an area now comprising 66% of group sales. Babcock’s know-how in marine engineering and nuclear submarine maintenance will be in strong demand as the Ministry of Defence concentrates on rising global threats. On a 2024 price/earnings (p/e) ratio of 8.5, the shares trade on a discount to defence-sector peers and could rerate as margins recover. 329p Babcock International Direct Line Insurance Interactive Investor Fierce competition in the motor-insurance market recently pushed shares in this insurer to an all-time low, but this sector might finally be bottoming out. There could well be more stockmarket volatility to come. Yet eventually investors should…

Chinese leader Xi Jinping and Russian president Vladimir Putin “made a sweeping affirmation of their alignment across a host of issues” this week following talks between the two leaders in Moscow, says Simone McCarthy on CNN. China’s calls for a ceasefire and peace talks in Ukraine were endorsed and both countries pledged to “further deepen military mutual trust”. Such words left “no question about Beijing’s commitment to developing its rapport with Moscow”, which it sees as critical to weakening US power. The talks were long on the rhetoric of friendship, but lacked substance, says the Financial Times. Crucially, no agreement was reached on helping Moscow weather Western sanctions, and Putin will be disappointed that China remained silent on the planned Power of Siberia-2 gas pipeline, which was to supply China…

It’s often difficult to distinguish between what you think should happen and what will happen. Think of the times that most of us have held onto a stock because we believe the business or the valuation will improve, in defiance of the facts. But it’s even harder when it comes to top-down macro-focused investing, because there are fewer guardrails you can put in place to protect yourself. A sensible investment checklist and criteria for deciding when to cut your losses can do a lot to protect a diversified portfolio of individual companies. When you place long-term explicit or implicit bets on specific trends or themes, it’s much harder to hide from the impact of getting the big calls wrong. The outcome of the bank-sector upheaval feels like one of these…

Data deluge doesn’t help investors Spencer Jakab The Wall Street Journal Wall Street traders surround themselves with screens, fund managers consult thousands of analysts and even retail investors now have access to a “fire hose” of information via their phones, says Spencer Jakab. But does all this information help? When millions of young investors opened brokerage accounts during Covid, many took cues from “influencers” only for their investments to suffer from confirmation bias (the tendency to find evidence that supports an existing thesis). As Rishi Khanna, CEO of StockTwits, a leading investing-focused social network, says, the problem is this bias is “overwhelmingly bullish”. “Official Wall Street is hardly more balanced.” An April 2022 report by FactSet showed that, of 10,821 analyst ratings on stocks in the S&P 500, “fewer than…

project-syndicate.org When the US imposed sanctions on Russia’s financial institutions, commentators warned that this “weaponisation” of finance would have far-reaching consequences for the dollar, as governments and central banks around the world turned to alternatives such as China’s renminbi. That never happened, says Barry Eichengreen. The renminbi’s share of global foreign-exchange reserves remains less than 3% of the reported global total. China’s currency accounts for less than 2% by value of all instructions for cross-border interbank payments sent through Swift. But a shift is under way – not towards China, but to other countries in Asia and elsewhere. Diversification away from the dollar has meant a boost not for the renminbi, but for the Korean won, Singaporean dollar, Swedish krona, Norwegian krone and other currencies. But these trends reflect not…

The revival of nuclear power is increasingly evident. I’ve written before about this theme and how to invest in MoneyWeek (see issue 1088 last year), but after Russia’s invasion of Ukraine, long-term security of supply for fuel is emerging as a complex part of the challenge. One key issue is enrichment – the process by which uranium oxide concentrate (known as yellowcake) is made suitable for use in nuclear reactors. Natural uranium consists largely of two isotopes: U-235 and U-238. The nuclear-fission process involves splitting U-235 atoms. However, the concentration of U-235 in natural uranium is just 0.7%. Enrichment increases this to 3%-5% by converting it into a gas and feeding it into centrifuges that produce enriched uranium (with high U-235 content) and depleted uranium (low U-235). Most reactors require…

Growing numbers of people are having to pay inheritance tax (IHT) because the £325,000 “nil-rate band” threshold has been frozen since 2009 even though incomes and asset prices (including property) have risen during the same time. By the end of February, Britons had paid a record £6.4bn of IHT, surpassing last year’s total with a month still to go. Since the threshold – above which 40% tax is due – will be frozen until 2028, more will fall into the trap in the years ahead. The Office for Budget Responsibility (OBR) expects 4,700 estates to be liable for the tax by then – 6.7% of all estates, up from 3.76% in the 2019-2020 tax year. If you’d prefer your wealth to go to your family and not the taxman, there…

The only disappointment for wealthy savers in the Budget was the refusal to dump the tapered annual allowance. It can severely affect the ability of those on high incomes to save for retirement. The principle of the tapered annual allowance is that the highest-earning savers should get less support from taxpayers when making pension contributions. They are therefore given a reduced annual allowance, and thus get less tax relief. At present, the taper applies to those with a yearly income of more than £200,000, and income and pension contributions combined of more than £240,000. If you’re affected, your annual allowance shrinks by £1 for every £2 that you’re over this sum until you reach income and pension contributions combined of £312,000. Those at this level or above have an annual…

For many people Monday mornings are the worst part of the week. After a weekend of relaxation and enjoyment, you have to get up early in the morning to go to work (or to log into your computer), with five days to get through. Various studies suggest that there are an above-average number of heart attacks on Mondays. This raises the question of whether Mondays are a particularly bad day to be invested in the stockmarket. All the evidence suggests that Mondays do indeed produce the lowest stockmarket returns out of the five working days of the week. Research by financial planners Financial Architects, focusing on daily returns in the S&P 500 between 1950 and 2010, found that Mondays tend to have an average negative daily return of 0.06%. By…

Ferrari swore for years that it would never make “such a sacrilegious conveyance” as an SUV, says Hannah Elliott in Bloomberg Businessweek. That was despite Aston Martin introducing the DBX, Bentley the Bentayga and Lamborghini the Urus. “Che sorpresa! The amount of money to be made by joining the most lucrative automotive segment in the world finally became too silly to resist.” Meet the new Ferrari Purosangue, meaning “thoroughbred” in Italian. It is all “sensuous curves… there’s not a straight line on this car”. Ferrari still cannot bring itself to call it an SUV, mind you, preferring instead to describe it as a voluminous “agile car”. “Whatever, the Purosangue… is Ferrari’s first-ever car with four passenger doors,” says Matt Prior for Autocar. The price alone is eye-opening at £313,120. “And…