Friday, February 22, 2019

Your weekend edge - catch up with this week's readings:

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Putting downturns in perspective(Link)

Buying is easy, selling is hard $(Link)
The researchers looked at more than 4 million trades among 783 portfolios from 2000 to 2016 and found that stock pickers actually showed skill when buying. However, the sales by these institutional investors cost them as much as 100 basis points, or a full percentage point, of yearly returns compared with a no-skill strategy of simply selling holdings at random. Translation: Investors spend way more time analyzing what to buy than what to sell.

Global inequality - it ain't what it used to be (Link)
On the planet as a whole, inequality has fallen dramatically. Not only has it fallen in terms of income, but it’s fallen in other dimensions of human well-being such as life expectancy and schooling. This is a poorly known fact in need of greater coverage. The poorest of the world have since experienced large increases in incomes. In fact, their living standards increased more rapidly than those of the richest in the world. Thus, there has been a fall in inequality. Depending on the methodology, the indicators of global income suggest falls between 9% and 33% since the 1970s.

A record number of Americans are 90 days behind on their car payments (Link)
More than 7 million Americans are at least 90 days behind on their auto loans, according to the New York Fed. That's higher than the peak in 2010 as the country was still reeling from the devastating financial crisis.

What happens when Canada ignores incentives and competitiveness (Link)
Between 2013 and 2017, Canadians increased investment outside the country by 74.0 per cent while foreigners investing in Canada declined by 55.1 per cent. Encana, one of the country’s premier energy companies now invests more outside of Canada than in it. And the company’s CEO recently moved to Denver and indicated that headquarter activity would become less-concentrated in Calgary. One of the country’s largest gold companies, Goldcorp, has just been purchased by an American company and much of its headquarter activity will now shift to the United States. TransCanada Pipelines recently announced it would change its name to TC Energy in part to try to attract more investors leery about investing in a perceived Canadian-only focused company.

Fossil fuels
Only 24% of Canada's total electricity generation comes from fossil fuels, ranking it sixth best out of 42 countries measured.

Replacing coal with the large increases  in domestic natural gas production and replacing dirty imported oil with a domestically supported oil industry is apparently the biggest factor towards the U.S. leading the world in emission change. No misguided global initiative required for the US to lead the world.  Maybe it requires a new government, supportive of investment and local industry,  for us to be environmental leaders?  

Source: BP Statistical Review of World Energy 2018

Household saving rate
German household saving rate is on the rise. Most of real wage gains are being saved, not spent.

What is GDP in China? (Link) 
"And yet, when you speak to Chinese businesses, economists, or analysts, it is hard to find any economic sector enjoying decent growth. Almost everyone is complaining bitterly about terribly difficult conditions, rising bankruptcies, a collapsing stock market, and dashed expectations. In my eighteen years in China, I have never seen this level of financial worry and unhappiness." - Michael Pettis

A building binge leaves cities with 65 million empty apartments (Link)

Celebrating with Liz, Sarah, and Theo on their 2nd anniversary!