By a slim margin, the Turkish people voted to change the country’s government from a Parliamentary system to a Presidential one. The change will reportedly cement the power of President Recep Tayyip Erdogan and allow him to stay in power for as long as 2029 assuming he wins the next two Presidential races. Erdogan argued this change will modernize Turkey’s democracy and address its security challenges. Opponents decry a steady march to authoritarian rule. From my outsider perspective, both sides have convincing arguments. However, I think that allowing such dramatic changes to governance to pass on just 51% of the vote seems like a recip...
A ‘shocking’ discovery was made when a pair of researchers at Harvard Business School decided to analyze the impact of higher minimum wages in San Francisco on restaurant failures…hint:they went up. Entitled “Survival of the Fittest: The Impact of the Minimum Wage on Firm Exit“, this latest study on the devastating consequences of minimum wage was conducted by Dara Lee Luca and Michael Luca and concluded that each $1 increase in the minimum wage results in a roughly 4-10% increase in the likelihood of a restaurant going out of business. In this paper, we investigate the impact of the minimum wage on restaura...
During the session on Wednesday, we get a handful of announcements including the European Union CPI numbers, Japanese exports, and the Crude Oil Inventories announcement. With this, we think there should be plenty of volatility. WTI Crude Oil Crude oil has shown his proclivity to go higher regardless of the announcement. Because of this, any automatic reaction to the downside after the inventory figure could end up being a call buying opportunity. Currently, looks as if the $52 level is attracting a lot of attention by call buying traders. USD/CHF The US dollar was weak during the session on Tuesday, as the Swiss franc gained enough momentum ...
Pound/dollar made a huge leap forward on April 18th, riding on the announcement for an early snap election. Here are five reasons why the elections are pound positive. GBP/USD is already trading above the initial post-Brexit low of 1.2790 seen in late June 2016, just after the EU Referendum. In general, we are back to the range the pair traded in the summer of that year. What levels should we look at? GBP/USD immediate levels The pair is trading at 1.2830 at the time of writing. The aforementioned first Brexit low at 1.2790 provides immediate support. The line was also challenged in July last year. On the topside, the pair finds resistance...
…If you polled a handful of investors and asked them which stocks in the aerospace defense industry are most noteworthy for dividend payouts, it is likely you would get two answers: Boeing Co. (NYSE: BA) and Lockheed Martin Corporation (NYSE: LMT). Both of these stocks are solid picks for dividend investors, as they are well established and offer excellent yields. Let’s see how the two stack up. Written by TheDividendManager.com Stock Performance In the last twelve months (shown below), both stocks have outperformed the S&P 500, which has increased 13% in the same time period. Boeing’s strong performance occurred duri...
Share buybacks have become a major focus of conversation within the investment industry—most recently due to speculation that if the U.S. government were to institute some sort of “repatriation holiday,” profits currently being held overseas to avoid taxation would be utilized largely for share repurchases to thereby “goose” earnings-per-share (EPS) growth by reducing the number of shares outstanding. However, in a broader sense, do firms that implement share buyback programs actually lead to stronger returns? The Importance of Net Issuance When judging a firm’s share buyback behavior, it’s critical to think in terms of the...
Written by Frik Els The price of 62% Fe content ore – the steelmaking raw material – plunged 5% on Tuesday to a six-month low of $61.50 per dry metric tonne according to data supplied by The Steel Index and is now down by more than 33% over just the last month with a consensus view that iron ore prices have got a lot further to fall. The knock-on effect on the market value of the world’s top iron ore miners have been dramatic [as a result]. The world number four, Australia’s Fortescue Metals Group (PINK: FSUMF), a pure play iron ore producer, has been hardest hit. FMG stock has lost more than 23% of its value over...
I joined CNBC yesterday evening to chat about Goldman Sach’s (GS) earnings miss. While the miss wasn’t that big (Goldman earned $5.15 per share vs. expectations of $5.33), this is the mighty Goldman Sachs we’re talking about. Goldman is the master of the universe, and it isn’t supposed to miss. So this had the effect of taking some of the wind out of the market’s sails. Goldman’s investment banking and investment management businesses actually performed just fine. It was primarily fixed income trading that disappointed, which is particularly noteworthy because this is an area where Goldman usually dominates its rivals. Goldma...
With every other asset class round tripping the November election outcome, it was only a matter of time before Japan’s 10Y JGB – which on February 2 briefly peaked above the BOJ’s “yield curve controlling” 0.10% yield ceiling, rising as high as 0.15% to the shock of a market ready to declare that Japan had finally lost control of its bond market – retraced the entire “reflationary” move from 0.0% to 0.1%. And, sure enough, following today’s violent deflationary capitulation moments ago Japan’s JGB 0.1% of 2027 once again dipped back under 0%, sliding as low as -0.003% on Wednesday ...
India’s US$ 115 billion software services sector has come under tremendous pressure since Donald Trump took over the US presidency, thanks to the protectionist policies and immigration restrictions from the international markets, which make up a bulk of the Indian IT companies’ revenues. The US government has signaled its intention to restrict the number of foreign workers and is in the process of reshaping the H1B work visa system – used liberally by Indian IT firms. US President Donald Trump is set to sign an executive order that will tighten the process of issuing H1B visas, and revise the system, creating a new structur...