Innehållsförteckning för 1185 från MoneyWeek

We are sometimes asked what our most successful idea has been since the magazine’s inception in 2000. The answer is gold. We first started looking at it in 2001, and I remember the price crossing the $300 an ounce mark in the spring of 2002. In September that year, for our 96th edition, we featured it on the cover, noting that “in the face of dollar weakness and America’s fast-rising money supply, gold has begun to reclaim its natural position as a financial hedge in troubled times”. Plus ça change. Gold is the only asset to have been in a structural bull market since we first decided we liked it. And at that stage, times appeared far from troubled. Stockmarket analysts, spoilt by the years of plenty before the dotcom…

“NatWest… tried to cling on to Alison Rose as CEO after [she] admitted to being the source of an inaccurate BBC story about Nigel Farage’s finances… BP is searching for a successor to Bernard Looney, having neglected to do due diligence on [his] personal life… companies [increasingly meet] the most obvious diversity requirement[s]… The [idea] is that… diversity leads to better decision-making. It isn’t clear that the latter is materialising, though… Class is the missing element in the diversity puzzle… Putting a (theoretical) woman of colour, educated at a top public school and Oxbridge on a board of white men who went to the same seats of learning, will probably not produce radically different thinking. Until boards… recruit non-executives… whose upbringings reflect those of customers and workers, they are likely…

Shares in British online luxury firm Farfetch halved last week in spite of reports that its founder could take it private after a collapse in its value, says Adrienne Klasa in Paris and Ivan Levingston in the Financial Times. The slump comes after founder José Neves told investors that “past forecasts should no longer be relied upon”. Farfetch, which sells luxury goods to consumers online, has consistently reported operating losses over the past five years thanks to “a high cost base and thin margins”. It had been due to buy nearly half of Richemont’s loss-making Yoox Net-a-Porter online fashion and accessories platform, but the deal “has yet to close due to regulatory delays”. If Farfetch does revert to being a private company, it would mark an abrupt end to a…

Around four-and-a-half billion people worldwide need glasses or contact lenses, but only two billion have them, says WirtschaftsWoche. The eyecare market is set to enjoy years of structural growth as people age and spend more time in front of screens. That spells opportunity for EssilorLuxottica, a combination of Italy’s Luxottica, a supplier of sunglasses and spectacles (brands include Ray-Ban, Oakley and Vogue Eyewear) with France’s prescription lens maker Essilor. The company controls around a third of the global wholesale contact lens and glasses market. New products such as Meta’s smart glasses should give growth an additional fillip in future.…

Politics & economics The government has unveiled measures aimed at cutting record net migration by 300,000, say Joshua Nevett and Paul Seddon on the BBC. Home secretary James Cleverly’s five-point plan includes hiking the minimum salary requirement for skilled overseas workers from £26,200 to £38,700 and the minimum income for dependants from £18,600 to the same level. Care workers will no longer be allowed to bring family dependants with them to the UK and the 20% discount applied to the minimum salary for workers looking for a visa for occupations with shortages of workers will be axed. The graduate visa route is to be reviewed to “prevent abuse”. Cleverly also signed a new asylum deal with Rwanda on Tuesday, says Anna Gross in the Financial Times. He said that the…

Ongoing legal woes aside, Donald Trump seems to have solidified his status as the favourite to re-enter the White House in 2025. With £7.12m matched on Betfair, Trump is at 2.54 (39.3%) with Joe Biden back at 3.2 (31.3%). Trump’s former ambassador to the United Nations, Nikki Haley, is at 11 (9.1%), and California governor Gavin Newson is at 15.5 (6.4%). Vice-president Kamala Harris is out at 50 (2%) in the same place as Ron DeSantis, with both behind fringe candidates Robert F. Kennedy Jr at 30 (3.3%) and even Michelle Obama at 38 (2.6%). I remain sceptical that Trump will ever return to the White House. Even if he manages to get around his legal problems, his increasingly (even for him) extreme rhetoric puts him at risk of saying…

Anyone who uses the internet to shop – which, come to think of it, is just about all of us – will have noticed that there is suddenly a whole new range of choices. If you want fast fashion, Shein has become the place to look. Its reputation will be enhanced with an IPO in New York that may well see it valued at $90bn or more, taking it right into the big league of major internet companies. Shein has faced a series of allegations over its supply chains and the meagre wages for its workers, but that hasn’t stopped teenagers in particular snapping up its stuff at bargain prices. It is already notching up $24bn in global sales, which are projected to hit $60bn by the middle of this…

A yield curve is a graph that shows how the yields on a group of related bonds vary according to their maturity. Investors normally focus on the yield curve for bonds such as US Treasuries or UK gilts. These governments have a vast number of outstanding bonds, with remaining maturities ranging from months to many decades in the future, and so their bonds provide a key benchmark for pricing other bonds and loans of different maturities. But yield curves are also used to compare yields versus maturities for bonds issued by a group of borrowers that have similar credit ratings, or even a single large company. Yield curves move up and down, and shift in shape, in response to demand for bonds of different maturities. A normal yield curve slopes…

Elliott Management has taken a $1bn stake in US oil refiner Phillips 66. It hopes to rejig the US oil refiner’s board and improve its poor recent performance after it lagged competitors in a period of high demand and soaring margins, says Reuters. The activist investor says Phillips 66’s management had taken its “eye off the ball” by letting expenses increase and that lacklustre refining and “poor execution” on cutting costs had dented investors’ confidence. Elliott said Phillips 66’s stock, currently worth $118, could reach $200 with its help. It wants to add two directors to the board. CEO Mark Lashier says that Phillips 66 will continue to have “constructive dialogue” with Elliott.…

“Money was always the goal, but I was obsessed with fame… embarrassingly obsessed… fame can be addictive. But now, my focus has shifted.” Kim Kardashian (pictured), reality-television star and clothing magnate, quoted on Yahoo “I approve of them. They are easy on the eye, pay their rent on time – and don’t join residents’ associations.” The late Earl Cadogan on why prostitutes made ideal tenants of his Chelsea properties, quoted in The Mail on Sunday “Shorting’s easy. You short a stock, watch it double, cover in panic, then wait for the inevitable bankruptcy.” An anonymous hedge-fund manager from the book The Art of Short Selling, quoted on The Variant Perception blog “If we had spent years sleeping on flea-infested mattresses in the back of a Hamburg club it might work.…

bloomberg.com/opinion UBS’s annual study of the super-rich shows that new billionaires accumulated more wealth through inheritance than entrepreneurship, says Chris Hughes. What’s more, more than a thousand ageing billionaires are expected to bequeath $5.2trn to heirs in the coming two to three decades. This “great wealth handover” matters because, as a related UBS survey shows, the self-made and their successors have different attitudes to wealth. Both see their main aim as continuing to grow their wealth. But heirs tend to be less inclined towards philanthropy. This may be because they’re reluctant to give away what they didn’t earn themselves, and so seek to make an impact through investments instead. Because they started out as wealth managers and not entrepreneurs, they have less of a separation in their minds between the…

It’s tax season again. You have until 31 January 2024 to file your return online for the 2022-2023 tax year. Miss the deadline and you’ll pay a £100 fine even if you don’t owe any tax. The deadline for paying your tax for the 2022-2023 tax year is also 31 January. If you are more than 30 days late paying, HMRC will charge you 5% interest on your bill. Don’t leave it until the last minute. If you need any help, the HMRC helpline is notoriously slow, with the average caller waiting more than 12 minutes to get through. If you think you don’t need to fill in a tax return anymore, don’t assume you can simply not bother. You have to contact HMRC to check. If they agree that…

Drawdown plans have become the default option for pension savers moving into their retirement years. But plans vary enormously, and the pension company with which you are currently saving may not offer the best deal as you start taking an income. It is therefore vital that all savers spend some time considering their options. Firstly, the basics. Once upon a time, most savers used their pension funds to buy an annuity on retirement. This offered a guaranteed regular income for life but locked you in at the prevailing market annuity rates when you made your purchase. A drawdown plan, by contrast, enables you to take an income directly from your pension fund, which you can leave invested, hopefully to grow further. But you must manage the plan carefully to avoid…

Insurance is not a good business. Most insurers lose money on an underwriting basis (the difference between premiums paid by customers and money paid out to cover losses). Most rely heavily on income from investment portfolios to cover losses from underwriting and help them remain profitable and solvent. An important figure to understand is the combined ratio. It gives investors an instant idea of a firm’s profitability on an underwriting basis. The figure is calculated by adding losses paid out and operating expenses, divided by earned premiums from underwriting. A ratio above 100% shows the firm is profitable on an underwriting basis; a combined ratio below 100% shows the company is losing money. A high combined ratio doesn’t necessarily signal distress, however. Firms can sustain combined ratios of over 100%…

This has been a reasonable fortnight for my long tips, with four rising and three falling. Luxury brand Watches of Switzerland climbed from 624p to 646p, kitchen supplier Howden Joinery increased from 691p to 738p, recruitment agency SThree went up from 405p to 413p and budget airline easyJet jumped from 417p to 471p. IT Services group Computacenter dipped from 2,736p to 2,693p and outsourcer Mitie fell from 106p to 99p. Greeting-card and gifting company Moonpig declined from 189p to 172p. Overall, my long tips are now making a profit of £693. All six of my short tips moved in the wrong direction. Electric car-charging company EVgo rose from $3.12 to $3.36, payroll company Paycom increased from $182 to $186 and solar-panel maker Sunrun jumped from $11.93 to $14.35. Retailer GameStop…

No animals were harmed in the making of this gift Vegans can feel a little hard done by at Christmas. Enter Harvey Nichols, which has come up with this No Reindeers Were Harmed Vegan gift box so all the family can get into the Christmas spirit. There is a Christmas pudding, sweets, preserves and even a vegan wine, Les Fées Brunes Crozes-Hermitage Syrah 2021. Last order dates for Christmas delivery, 3pm 20 December. £75, harveynichols.com Enjoy Christmas without leaving the house Sometimes bigger really is better and The Imperial Hamper from Fortnum and Mason surely has everything you could possibly want for Christmas. The total contents are sent in five hampers filled with teaware, accessories, decorations and a vast array of delicious festive treats. From Champagne and caviar to Christmas…

“Something collectable” is the answer to the great question that comes up every Christmas: what do you get that person who already has everything (or, at any rate, grumpily tells you they don’t need anything)? Nobody needs a rare vinyl or a first edition. They are just nice to have for those who are into that sort of thing and everybody, no matter what they tell you, has an interest in something. And it’s not about whether that vintage snuff bottle or Toby jug will sell for more than you paid for it a few years down the line. If that’s your goal, you might as well get them a long-dated government bond. But that’s not very festive. A collectable item is something deeply personal and meaningful. It is the…

Inspiration can always be found in a good book, as Jane Austen would tell you. A copy of Isaac D’Israeli’s Curiosities of Literature, a work containing anecdotes about historical persons and the habits of book-collectors, features passages such as “On the Fair-Sex Having No Soul”, that were most likely underlined in pencil by the novelist. She was a voracious reader, having access to her father’s library, and she scoured books for ideas for her novels, particularly those relating to English society. Today, that copy of Curiosities of Literature, published in 1791, is heading to auction with Sotheby’s in New York, with a pre-sale estimate of up to $150,000 – the ideal, if pricey, present for any fan of Austen. But rare books more generally make for great Christmas gifts and…

Riots broke out in Ireland last month after an Algerian-born immigrant stabbed five people, including three children, reports the Washington Examiner. Prosecuting those who broke the law should have been the end of the matter, says the paper. “But the Irish government is sensitive about the fact that their immigration policies, which have led to almost 20% of the country’s population being foreign-born, are unpopular. The pace of mass migration has been particularly dramatic in Ireland, with almost half of all migrants… entering in just the past five years.” The rioters are easily dismissed as hooligans. But is that all there is to it? Is it just about immigration? Does anger increase until the riff-raff erupts, or the “deplorables” vote for Geert Wilders or Donald Trump? That’s what the press…

Isabel dos Santos (pictured), Africa’s first female billionaire and the daughter of Angola’s former president, José Eduardo dos Santos, is fighting an application to freeze up to £580m of her assets, including a £21m property in London, at the High Court, says Sam Tobin for Reuters. Dos Santos is the subject of a legal complaint from Angolan telecoms operator Unitel over loans made to Dutch company Unitel International Holdings (UIH) in 2012 and 2013 when she was a director of the company. The loans were never repaid and around £300m is outstanding, according to Unitel. Dos Santos says Unitel is responsible for UIH’s inability to repay the loans, because of the role she claims the company played in Angola’s unlawful seizure of UIH’s assets. She also claims to be the…

The High Court has ruled in favour of the London Metal Exchange (LME) in a legal dispute with traders who lost out when it cancelled nickel trades last year, say Sam Tobin and Pratima Desai on Reuters. Elliott Associates and Jane Street Global Trading had been seeking $472m compensation from the LME over the dispute, which dates back to March 2022, when Russia’s invasion of Ukraine triggered a dramatic rally in nickel prices. Fears that sanctions would choke off Russian nickel supply forced companies that had been shorting the metal to buy it instead in order to cover themselves – a “short squeeze”. That sent nickel prices soaring from their usual range of $10,000-$20,000 a tonne to more than $100,000. The turbulence prompted the LME to halt trading and retroactively…

Has the euro area conquered inflation? Annual price changes in the currency bloc topped 10% in October 2022 but fell to 2.4% last month – not far from the European Central Bank’s (ECB’s) 2% target. Falling energy costs drove the decline (natural gas prices are much lower than this time a year ago). Core inflation, which excludes volatile food and energy prices, fell to 3.6% from 4.2% a month before as a weak economy cools the prices of services and industrial goods faster than expected. The “punitive monetary-tightening medicine of the past 18 months is working”, says Marcus Ashworth on Bloomberg. “Perhaps too well.” With German manufacturing mired in recession, the debate has now shifted to whether the ECB has tightened too much.…

Metro Bank is axing a fifth of its workforce as part of a “cost-saving drive” to save up to £50m a year, says Ben Martin in The Times. While some of the job losses will come through investing in automation for back-office operations and improving digital channels, they also include reductions to its service hours and the seven-day operation of its branch network. The plans come after a £925m emergency refinancing deal that rescued it from the edge of bankruptcy but has left it “shouldering expensive debt-financing costs”. The plans for “ramped up cost-cutting” by reducing service and convenience should come “as little surprise”, says Kalyeena Makortoff in The Guardian. After all, Jaime Gilinski Bacal, who saw his stake rise from 9% to 53% after injecting an extra £102m during…

PT Petrindo Jaya Kreasi has become the world’s best-performing initial public offering (IPO) this year, says Bloomberg. The Indonesian coal miner has soared by more than 2,900% since it listed in March, following a $25m offering, with the company’s market value having grown by more than 25 times to $5.4bn in nine months. Backed by main shareholder and billionaire Prajogo Pangestu, the stock has profited from investors’ growing general interest in Indonesian stocks as well as its own attributes. Petrindo has been diversifying into gold and nickel mining. However, the stock is now trading at 114 times earnings, compared with the benchmark index’s 16.…

● The Competition and Markets Authority (CMA) will get accused of “meddling in minor matters” over its plan to look into supermarket loyalty schemes, but the move is welcome, says Nils Pratley in The Guardian. Tesco and Sainsbury’s offer cheaper prices to shoppers who sign up to their Clubcard and Nectar schemes, but that means a range of people – from “data refuseniks” and the “lazy and disorganised” to foreign visitors and the under 18s (both of whom are barred) – are guaranteed to lose out. And that assumes the discounts are genuine and not just “reductions from a cunning and briefly charged higher price”. The CMA may conclude that “rewarding loyalty is legitimate”, but an inquiry is clearly justified. “Two-tier pricing has happened by stealth and plainly doesn’t benefit…

The world is “coming to the end of our good times”, says Jim Rogers, the former hedge-fund manager who co-founded the Quantum Fund with George Soros in the 1970s. “I suspect in the next year or two we will see some kind of major, major problems, longer-term problems, in the world financial markets.” US stocks have been rising since the beginning of the 2010s – the longest bull run in its history, but one that will end soon, Rogers tells Nikkei Asia. “The list of stocks going up is getting narrower and narrower. And that usually means bad times are coming.” A recession is “getting closer” and the US Federal Reserve will cut rates next year. Rogers has long been bullish about China, but the problems in the real-estate sector…

■ UK investors withdrew a record £544m from environmental and social governance (ESG) funds in September, says the Financial Times. According to The Investment Association, investors have withdrawn more than £1bn from ESG, or “responsible”, funds so far in 2023. ESG investing was popular before and during Covid as the funds were weighted towards high-growth stocks in developed countries and avoided energy and travel firms. But growth companies have since been hit hard by rising interest rates, which reduce the present value of future earnings, and ESG funds have also lost their lustre after a political backlash in the US. Energy stocks have also soared in the past year. Despite the outflows, Hargreaves Lansdown’s Emma Wall maintained that “transparency, ethical behaviour and good governance practices are essential in attracting and…

aier.org For thousands of years, church and state were symbiotically linked, says Michael Munger. Now, many see the separation of church and state as a necessary condition for stable government. Argentina’s president, Javier Milei, wants to “dollarise” the economy, ie, to abandon the peso for the US dollar. Future generations may well look back and see this separation of money and state as just as necessary to stable government. If a state wants to spend more than its revenues, it can raise taxes or sell bonds, but it can also simply print piles of money then spend that. The inflation that results is also useful for politicians seeking to escape the debt burden they have created from using state spending to buy votes or bail out banks. This strategy has…

Put all your purchases on a cashback credit card this Christmas and you could turn gift shopping into a nice little earner. Be aware, though, that the interest rates on cashback credit cards are high. So make sure you can pay your balance in full each month. American Express tends to be top of the tables for a range of rewards, but you’ll often have to pay a fee to unlock the best rates. The American Express Platinum Cashback Everyday card pays 0.5% on spending up to £10,000 a year. Then the rate increases to 1% cashback. You’ll also get 5% cashback for the first three months – capped at £100. Or you can pay a £25 annual fee for the Amex Platinum Cashback card and earn 0.75% cashback up…

Pension industry professionals are getting excited about the “pot for life” reforms mooted in last month’s Autumn Statement. Chancellor Jeremy Hunt wants to change the law so that employees have a legal right to make pension contributions into an existing pension, rather than into the plan run by their employers. The idea is to make saving simpler for people, avoiding the current situation whereby savers end up with multiple pensions because they start a new plan each time they changed jobs. However, while the proposal comes with good intentions – not least to reduce the number of people who lose track of bits of their savings and are therefore worse off in retirement – experts have some big reservations. They worry about the technology needed to deliver the idea. And…

Over the past few years there has been a rise in the number of “short squeezes”, whereby investors buy up shares in companies that are heavily sold short. The idea is to push up their price in the hope that those who have bet against them will have to buy back their shares at a loss, propelling the price even higher. The story of the most notorious short-squeeze, the GameStop squeeze of 2021, was even made into a film this year. One recent squeeze that hasn’t quite caught the headlines in the same way but is still significant is the one relating to the American used-car website Carvana (NYSE: CVNA). Carvana was one of the stocks that surged during the pandemic owing to the closure of physical retailers as well…

Since 1985, AVI Global Trust has followed the same distinct investment philosophy. We invest in durable businesses that are growing in value and trading at discounted valuations, with catalysts to unlock and grow value. We aim to benefit from growth in net asset value (NAV) and discount narrowing, driving long-term returns in excess of global equity markets. A misunderstood media giant One such holding company we consider attractive is News Corp (Nasdaq: NWSA), the Murdoch family-controlled holding company. We believe that News Corp is one of the most misvalued and misunderstood companies in our investment universe, trading at a 63% discount to our estimated NAV. The NAV is principally comprised of the following: a 62% listed stake in REA (worth 36% of NAV), the Australian real-estate classified marketplace, along with…

Alistair Darling (pictured), who died last week at the age of 70, was not one for hiding his mistakes. In the summer of 2008, in the midst of the financial crisis, the then chancellor of the exchequer gave an interview to The Guardian in which he predicted that the coming recession would be the worst for 60 years. The comment outraged the prime minister, Gordon Brown, who gave counter-briefings and tried to get him sacked, says Julia Langdon in The Guardian. The “forces of hell” were unleashed against him, Darling later said, and he admitted that he had in fact been mistaken: he should have said the worst recession for 100 years. As a student, Darling read law at Aberdeen University and became a Marxist firebrand who handed out leaflets…

2020 Bourgogne Pinot Noir, René Lequin-Colin, Burgundy, France £19.50, reduced to £17.55 each by the case, stonevine.co.uk I have not tasted Lequin-Colin’s wines for years, having bought a series of whites from this estate many years ago for a couple of old restaurant consultancies. So it was a revelation to come across this wine from the brilliant cellar at Stone, Vine & Sun, made from various plots around the village of Santenay. With a hint of oak threaded through the sumptuous pinot-noir fruit, this wonderfully refined wine belies its lowly classification. I would be more than happy to boycott any red Burgundy imaginable while saving a small fortune this Christmas if I had this fabulous wine in my rack! 2016 Gusbourne, Fifty One Degrees North £195.00, gusbourne.com; bbr.com If you…

Going… Dire Straits guitarist Mark Knopfler will be parting with around 120 guitars and amps that he no longer uses at a Christie’s sale in London on 31 January 2024. Before that, the guitars, which he has used across his 50-year career, will go on display from 19 January. A Fender Mark Knopfler Signature Stratocaster Prototype (pictured) is among the highlights, with a pre-sale estimate of up to £6,000, as is a 1958 Gibson ES-335, valued at up to £90,000. But leading the sale is a 1959 Vintage Gibson Les Paul Standard, which Knopfler played on the “Sailing To Philadelphia Tour” in 2001 and the “Kill To Get Crimson Tour” in 2008, as well as on several recordings. That one could fetch up to £500,000. A quarter of the total…

The pre-Christmas “Santa rally” is “the gift that just keeps on giving”, Tom Stevenson of Fidelity International tells Harry Wise on This is Money. November was the best month for global markets in three years, with the MSCI All-Country World index gaining 9%, says Wise. The technology-focused Nasdaq Composite index finished the month up by 10.7%, with the S&P 500 index gaining 8.9%. The pan-European Stoxx 600 index climbed by 6.5% on bets of earlier interest-rate cuts in Europe (see page 5). A soft landing? The rally has been inspired by data showing the US economy is on course for a soft economic landing, say Harriet Clarfelt and Nicholas Megaw in the Financial Times. “Price rises are slowing and the job market is cooling, even as overall economic activity remains…

Shares in bootmaker Dr. Martens slumped by a fifth last week after the company produced its fourth profit warning this year. The US division has suffered “a kicking”, says Leah Montebello on This Is Money. Sales there plunged by 18% in the six months to 30 September, causing overall profits to fall by 55%. The Northamptonshire firm has blamed the “unseasonably warm weather putting consumers off”, as well as “wider economic pressure on Americans”. Disruption at its Los Angeles distribution centre has also led to “problems with shipping products to customers throughout this year”. The fact that wholesalers in the US “are reluctant to stock large volumes of its boots and shoes” suggests “a lack of confidence in US consumer spending power”, says AJ Bell’s Russ Mould. With the cash…

Four to buy Costain Group The TelegraphShareholders haven’t forgiven this infrastructure specialist since it “got itself into a terrible tangle” with two projects a few years ago, forcing it to seek £100m in extra equity in 2020. But the shares are now heavily discounted on ten times forecast earnings. Indeed, after adjusting for pensions and leases, the £167m in net cash on the balance sheet actually exceeded the market capitalisation as of 28 November. The shares are priced for further disappointments, so even a small improvement in performance and margins could now offer decent upside. 57p Goodwin The Mail on Sunday This 140-year-old family engineering business is one of a mere five foundries in the world accredited to make submarine and frigate castings for the US navy. Goodwin also produces…

Venezuela’s government claimed an “overwhelming victory” in a referendum on its claim to the Essequibo region of neighbouring Guyana, the site of one of “the world’s biggest recent oil discoveries”, says the Financial Times. Guyana denounced the vote as a “pretext for annexation” and accused Caracas of “preparing a military build-up” to enforce the referendum’s outcome. In a speech on Tuesday, Venezuela’s president Nicolás Maduro (pictured) ordered state companies to exploit oil deposits and mines in the territory run by Guyana, announced the formation of a special military unit, and ordered the publication of new maps showing Essequibo as part of its territory. Any conflict between the two nations would represent a new crisis for the US, which is seeking a rapprochement with Maduro to secure oil supplies. Observers and…

What is “business investment”? It’s the money spent by corporations on the physical assets – equipment, machinery, buildings – and non-physical assets – software and other intellectual property – that are essential to producing goods or services. Higher levels of business investment (known by economists as private-sector “gross fixed capital formation”) are widely viewed as central to driving innovation and technological progress, fostering growth and economic stability, and creating high-quality, well-paying jobs over the long run. That’s a view shared by Rishi Sunak, who placed the need to increase business investment right at the centre of his economic agenda for the UK (in his Mais lecture at Bayes Business School, as chancellor in February 2022). The UK’s levels of investment are exceptionally low compared with similar countries. Here, business investment…

Markets only care about what will happen, not what should happen. Since big decisions often hinge on event that we feel strongly about, this can be a psychological hurdle for investors. The adage “don’t fall in love with your stocks” exists for good reason – once you’ve bought into a company, it’s easy to feel that it deserves to succeed and ignore signs that it is taking the wrong turn. But the same risk exists in top-down investing, since many of us have strong view about how the economy could be fixed. The MoneyWeek exchange traded fund (ETF) portfolio deliberately tries to reduce this. It aims to deliver reasonable returns across a wide range of outcomes rather than betting on a single one. It stays diversified. It may even hold…

Amedeo Air Four Plus (LSE: AA4) is one of the more unusual investment trusts listed in London. Its goal is to generate income and capital returns for shareholders by acquiring, leasing, and selling aircraft. The company has a portfolio of six A380, two B777-300ER and four A350900 aircraft, all on long-term leases to Emirates Airlines and Thai Airways. But investors need to have some understanding of the aviation market to see the opportunity here in both the medium and long term. The market has been turbulent over the past few years owing to the pandemic and the slow recovery of leisure travel worldwide. For some time it looked as though the market wouldn’t recover to pre-pandemic levels as analysts argued that the pandemic had changed consumer trends for good. Airlines,…

The engine of the green revolution Cindy YuThe Spectator With “little fanfare and a lot of state help”, Chinese firms are now “leaders in wind, solar, hydro, lithium batteries and electric cars”, says Cindy Yu. The world’s top polluter has become the “engine of the green revolution”. Last year, China made 75% of all lithium-ion batteries. A third of electric cars sold in Britain are made in China. Two-thirds of the world’s largest 15 wind-turbine manufacturers are Chinese. The only gigafactory being built in the UK is being overseen by Envision, a Chinese multinational. Beyond the “economic headache” (Xi Jinping spotted this business opportunity 15 years ago), there are concerns about ethics and security. China may own 50% of all lithium-ion battery factories in Europe within ten years. Chinese cars…

compactmag.com “FordTechMakuloco,” an independent mechanic with a YouTube channel, tells the story of a 2018 Ford F-150 pick-up truck with a failed rear light, says Matthew Crawford. It’s a common failing that should be easily repaired. The bill? $5,600. How could that be? Fixing the light should be a matter of replacing a bit of wire or a bulb. But the electronic complexity of modern cars means that the rear light is connected to all kinds of other electronic parts and systems, and even diagnosing what’s wrong is no easy task. Indeed, scrapyards are now full of relatively new cars that are in great shape mechanically, but have gone “underwater” due to repair costs associated with electronic complexity. This is not driven by demand from customers, but is a result…

● HMRC is warning investors in cryptocurrency that “they need to come clean about unpaid tax amid concerns that more than half of them do not know that they could be liable over their gains,” warns Lily Russell-Jones in The Times. You can disclose any unpaid taxes on cryptocurrency assets such as bitcoin via the Gov.uk website. “As ownership of crypto assets tends to be concentrated among young adults, much of this noncompliance may stem from people simply not knowing or understanding their tax obligations,” Dawn Register from accountancy firm BDO told the paper. If you sell cryptocurrency, exchange it for a different currency or use it to pay for something this is classed as a disposal and could be liable for capital gains tax. If you receive cryptocurrency as…

● Struggling for inspiration for the children or grandchildren this Christmas? Maybe you should pay into a pension plan for them. Junior pensions offer the same range of generous tax breaks as other types of private pension plan and can be invested to deliver substantial returns over the long term. They can only be opened by a parent or guardian, but once they’re up and running, anyone can pay into them. Just bear in mind that the maximum total annual contribution is £3,600. ● Documents published after the Autumn Statement indicate the government has had a rethink on changing the tax rules that apply if you pass on pension benefits to your heirs. Currently, most such bequests do not give rise to an inheritance-tax (IHT) charge, but initial proposals to…

The past two years have generally been pretty poor for the initial public offering (IPO) markets. The number of firms listing on the US stockmarket is still only a fraction of the level seen in 2021, and well below the average since 2000. Across the Atlantic, the number of firms floating in Europe is set to be the lowest since 2013. However, while this may be bad news for bankers working on deals, as well as for those investors who want to get their hands on the most promising companies, it’s less clear whether this is a bad sign for the overall health of the market. Some contrarian investors argue too many IPOs can be a sign that the market has peaked. The reason for this is that those who…

Investment trusts are deeply unloved at present, both the conventional equity type and their alternative cousins. According to data from stockbroker Numis, the discount to net asset value (NAV) of the sector is 15%, which is similar to levels seen during the Great Financial Crisis of 2008-2009. Some of these discounts can be explained by investors’ nerves, which isn’t surprising given a poor economic outlook. Central banks have embarked on the most aggressive financial tightening cycle in modern history. It seems likely that the full effects of that tightening are yet to be felt and so, even if inflation is brought under control by their actions, economic pain in the form of a recession is likely to follow. The high valuations of equity markets, particularly in the US, exacerbate these…