Financial articles of MoneyController

Silver economy, a specific but transversal investment segment

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Investments

Posted on 07.11.2024

Due to demographics and advances in medical care, the world's population has grown a lot and life expectancy has also increased a lot. The number of people who are fortunately over the age of 65 in good health is such that there is even an economic sphere that directly involves them. What is the silver economy? The silver economy is that set of services and products linked to consumption in old age, which is typically that following retirement (or at any rate the cohort over 65). It is an economy that is not only growing, but also progressively articulating. Frank Di Crocco, interim Head of Italy Distribution at Invesco, spoke about this during an interview with ‘Financialounge’ (in the ‘Stay Live’ programme). How is the silver economy articulated? But how does the silver economy articulate itself? As Di Crocco explains, the spending capacity of this segment of the population allows it to range from services and products related to wellnes ...

Trump will be president of the United States again: what do the markets expect?

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Financial markets/economy

Posted on 06.11.2024

Donald Trump has won the US elections and will soon become the next President of the United States. The administration will change sign: from Democrat, the government in Washington will become Republican. What had financial analysts said so far about the former president's victory? Trump's spending promises During the election campaign, both Donald Trump and Kamala Harris had promised to raise the national debt. As reported by ‘Market Watch’ in an article by William Watts, Tom Essaye (founder of Sevens Report Research) wrote that Trump's Republicans were seen as more growth-oriented, but using deficit leverage. But what were the estimates of this growth? Jasmine Li of the Wall Street Journal reports on the forecasts of the ‘Committee for a Responsible Federal Budget’: the average estimates (referring to the time frame 2026-2035 and formulated by analyst Chris Krueger of TD Cowen) were of an increase in debt of USD 3.5 trillion in the case of Kamala ...

The World Bank and agricultural commodity price forecasts

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Raw materials

Posted on 05.11.2024

At least three factors weigh on the agricultural commodity market when it comes to forecasts for 2025: 1) climate, including climate change, 2) the (broadly defined) energy market and 3) geopolitical dynamics. This is said by the World Bank, which predicts an increase in vulnerability and an overall market decline of 4% for 2025, forecasting instead a stabilisation for 2026. But let us see in a little more detail what some of the effects of these factors might be. The influence of climate and climate change It is not even necessary to explain the reasons why climate and climate change have a decisive influence on agricultural commodities. It can be added, however, that according to many experts, climate change tends to increase the magnitude of certain weather phenomena (remaining in Europe, this is shown by events such as the floods in Emilia-Romagna, Italy, or the recent catastrophe in Valencia, Spain). Although the World Bank predicts a generalised fall in prices, it points out th ...

US stock markets: between Nvidia's climb, quarterly reports and AI costs

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Financial markets/economy

Posted on 04.11.2024

An update on some of the latest movements on the US stock markets of some of the big tech companies. Very positive quarterlies for big tech but not all of them are growing on the stock market: why? It has been a particularly positive third quarter for some of the big US tech companies: Amazon, Apple, Google (Alphabet), Meta, Microsoft and Netflix have all reported close to USD 100 billion in earnings. As Vittorio Carlini (‘Il Sole 24 Ore’) points out, revenues also recorded a very similar percentage increase, compared to the previous year: just under USD 459 billion (an increase of about 12%). Despite these results, not all companies were rewarded on the stock exchange; this is the case with Microsoft and Meta. How come such positive results? Investment in artificial intelligence infrastructure One of the other indicators that Wall Street keeps a close eye on is expenditure, namely the so-called Capex (‘capital expenditure’). As Pierangelo Soldavini (‘ ...

BRICS vs. ASEAN: what it's all about and what prospects for investors

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Investments

Posted on 31.10.2024

In the world, there are large organisations between states (such as the BRICS and ASEAN) that can act as a compass for international relations: but does this also apply to investors? What does BRICS mean? Another brick of globalisation: it was with this play on words that Jim O'Neill, an economist at Goldman Sachs, coined the acronym ‘BRIC’ which, with the addition of South Africa would become BRICS: Brazil, Russia, India, China and, precisely, South Africa. That was in 2001; more than twenty years later, that group of states does not look so much like another brick to western-style globalisation: rather, it appears as an alternative model to western globalisation; and it was precisely this topic that was the focus of the last meeting in Kazan, Russia. The heterogeneity of the BRICS grouping Over time, the BRICS has been joined by many other countries, including Egypt, Iran, Saudi Arabia, Kazakhstan, Malaysia, Nigeria, and many others. It is a group with a strength: ...

What's driving US bonds these days?

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Gov. bonds and Spread

Posted on 30.10.2024

Bond yields and, in particular, US government bonds are rising: but perhaps it is the economy that is driving this growth rather than the upcoming elections. Rates, growth, employment and inflation It would be a fairly consensus view that bond yields are driven by the prospect of a forthcoming US government led by Donald Trump. Nevertheless, Randall W. Forsyth believes that the real driver of the US bond market remains the economy. The rise in interest on Treasuries, in particular, would be due to two factors: on the one hand, the Federal Reserve's cut in interest rates and, on the other, the positive performance of the economy, both in terms of GDP and employment. But a soft landing (lowering rates with a growing economy) could lead to the re-emergence of another problem: inflation. Will the outcome of the election be decisive for the economy? Forsyth writes that it is true that the markets - even in the climate of uncertainty about the outcome - believe that a re-election of ...

Is the Green Deal a lost cause for investors?

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Green economy - green bond

Posted on 29.10.2024

What is the future of the ‘Geen Deal’? What are the opportunities and the many difficulties it faces? Many are evidently asking this question, including those investors who are wondering how strategic it might be to focus on this set of climate and environmental protection measures. What in essence is the European ‘Green Deal’? The ‘Green Deal’ is a set of measures designed by the European Union to combat climate change by reducing the polluting impact of human activities. As Sylvie Goulard and Aure Keraron write in ‘Affari&Finanza’ (‘La Repubblica’), this project is remarkable both for its ambition and for its articulation: it ranges from the preservation of biodiversity to reductions in so-called greenhouse gases; from the promotion of clean energies to ‘green’ building. Some areas affected by the ‘Green Deal One of the problems today of the ‘Green Deal’ in Europe, however, lies in the f ...

Investments: where to focus your attention

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Investments

Posted on 28.10.2024

Market concentrations, interest rates, economic trajectories, and the unknown about the U.S. election are among the most important variables in markets today. The unbalanced concentration on the U.S. market Also mentioning the opinion of some experts and investment analysts, in his article in the “Corriere della Sera”, Pieremilio Gadda refers to some of the variables most taken into consideration by investors these days: there are the U.S. elections (which could bring turbulence to the markets), the upcoming possible cuts in interest rates, the trajectories of economies, and the concentration in financial markets, especially the weight of U.S. capitalizations. This last point is important (and a harbinger of some considerations by analysts): in the Msci World index, U.S. equities weigh as much as 72 percent, but only ten years ago they were around 55 percent. Possible rotation in favor of other markets and market segments? Concentration is so high in favor of the U.S. p ...

AI can push uranium and utilities upwards

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Raw materials

Posted on 25.10.2024

Among commodities, uranium could take advantage of the growing need for energy by the US tech industry. Here's why. Uranium price rises, what prospects? On ‘MarketWatch’, Michael Brush writes about how uranium has seen its price rise over the past 5/6 years in a very big way. However, the situation could continue to prove promising for the mineral: some of the largest US tech companies seem increasingly willing to rely on nuclear power to meet their energy needs. Driving consumption are data centres and the technology that has been most talked about in the past two years, namely artificial intelligence. Big tech in search of nuclear power A striking case in point is Microsoft, which entered into a contract with the Crane Clean Energy Center to restart a nuclear reactor in Pennsylvania. David Arcaro of Morgan Stanley wrote that Microsoft would be willing to pay 100 per cent more than the market price for energy, so high is its demand ($100 per MWh instead of $50). Bu ...

All the advantages (and some shortcomings) of certificates

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Financial products

Posted on 24.10.2024

Certificates are complex products used by professionals often for the purpose of diversifying their portfolio investments. Here are some pros and cons of these financial instruments. What are certificates? During an interview with ‘Financialounge’, Costanza Mannocchi, Head of Exchange Traded Products Italy at Societe Generale, explained the diversification role that certificates (or ‘certificates’) can play. These are financial products that - explains Mannocchi - ‘incorporate and make tradable an investment strategy’. More in detail, certificates are financial products that reproduce the trajectory of an underlying asset, to which they add a certain investment strategy (from leverage to a ‘cap’ and ‘barrier’ mechanism, i.e., thresholds and limits on losses and gains). Transparent, liquid and able to diversify Mannocchi speaks of these products as transparent and liquid, since a) ‘the strategies are summarised in a m ...

Netflix, between top results and some unknowns about the future

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Financial markets/economy

Posted on 23.10.2024

Netflix's latest results have exceeded expectations and have been greeted with a considerable rise in the stock market price. But what are (according to some analysts) the company's prospects at this point? Results beyond expectations Netflix, the world-famous streaming platform, exceeded expectations regarding new subscribers in the third quarter of 2024: 5.1 million new subscriptions, compared to an expectation of 4 million. Revenues were also, albeit slightly, above expectations, and EBITDA was also better than a year ago. Overvalued stock? The platform's shares skyrocketed and are now trading at around $760 each. Meanwhile, the company is working to develop new sources of return from advertising. Not all analysts, however, share the same enthusiasm: on ‘Barron's’, George Glover points out that there are those who believe Netflix's shares may be overvalued today. Solid fundamentals, but expectations too high? Morningstar's Matthew Dolgin, fo ...

Corporate bonds: the opportunities in Europe

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Investments

Posted on 22.10.2024

There is a lot of talk about stock markets in recent weeks, but it may also be worth dwelling on the situation in the bond market today, with particular reference to the situation of European bonds. Europe lags behind the US on technology and market capitalisation Europe is a very rich region, but its productivity is lower than others, e.g. compared to the productivity of the US. Moreover, again in comparison with the US, Europe lags behind on both technological innovation and capitalisation (important to support a policy of massive investment). This is the picture described by Patrick Vogel, manager of the Schroder ISF Euro Corporate Bond fund. Consuelo Blanco writes about it in ‘FUNDS People’. Short-term corporate bonds This is not a very reassuring picture, all the more so given Europe's economic slowdown. Nevertheless, Vogel identifies some investment opportunities when considering the bond market. In particular, Vogel focuses on corporate bonds and short-dated ...

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