Welcome back.
In this week’s magazine, we explore the investment opportunities in outsourcing. The sector has seen more than its fair share of blunder and scandal, to the benefit of neither shareholders nor voters – and yet slow but steady improvements mean now may be the time to invest, says Jonathan Compton. Find out what he has to say in this week’s magazine – if you’re not already a subscriber, sign up for MoneyWeek magazine now.
This week’s “Too Embarrassed To Ask” video looks at metaverse. The term “metaverse” sounds like something out of a science fiction novel (and it is). But what does it actually mean (it’s not just crypto though that’s involved)? Find out here.
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And in the podcast this week, Merryn and John talk about what lies behind the shortages we’re facing in everything from chicken to microchips – is this really a once-in-a-lifetime disaster, or is it just because we’re suddenly paying a lot more attention to how the supply chain works? We also look at why now might be a good time to follow private equity into the UK. Find out what they have to say here.
Here are the links for this week’s editions of Money Morning and other web articles you may have missed:
- Monday Money Morning: What income investors should learn from the Covid-19 pandemic
- Tuesday Money Morning: What PayPal’s foray into cryptocurrencies means for your money
- Wednesday Money Morning: Boom, bust - what's next for bitcoin?
- Thursday Money Morning: The UK is cheap - you should invest some of your money there.
- Friday Money Morning: Will Jerome Powell lay out a tapering timetable today? Probably not
Now for the charts of the week. The big event turned out to be a more dovish-than-expected speech from Jerome Powell at Jackson Hole, last thing on Friday.
Gold rose this week as investors bet that rising Covid-19 cases could deter the US Federal Reserve from announcing taper plans at the Jackson Hole Symposium – which, as it turns out, is what happened.
(Gold: three months)
The US dollar index (DXY – a measure of the strength of the dollar against a basket of the currencies of its major trading partners) rose ahead of Powell���s speech but lost ground in its wake as Powell noted that interest rates weren’t likely to rise in anything like the near future.
(DXY: three months)
The yield on the ten-year US government bond was higher ahead of the speech (yields move inversely to the price of bonds).
(Ten-year US Treasury yield: three months)
The yield on the Japanese ten-year bond also rose a little ahead of Jackson Hole.
(Ten-year Japanese government bond yield: three months)
And the yield on the ten-year German Bund followed the direction of US bonds.
Ten-year Bund yield: three months)
Copper prices were steady ahead of the Fed's symposium and then jumped higher as the dollar fell back on Powell’s relaxed tone.
(Copper: nine months)
The closely-related Aussie dollar rose over the course of the week.
(Aussie dollar vs US dollar exchange rate: three months)
Bitcoin rose a little after the crypto market received a boost on news that PayPal, one of the world's largest payment processors, is allowing UK account holders to buy and sell crypto.
(Bitcoin: three months)
US weekly initial jobless claims' 4-week moving average was 366,500, a decrease of 11,500 from the previous week's revised average. This is the lowest level for this average since March 14, 2020 when it was 225,500
(US initial jobless claims, four-week moving average: since Jan 2020)
The oil price rose for most of the week after US government data indicated fuel demand shot up to its highest level since before the pandemic began.
(Brent crude oil: three months)
Amazon rose on the previous week, slightly reversing the recent decline.
(Amazon: three months)
And Tesla remained volatile, ending the week little changed.
(Tesla: three months)
Have a great weekend. There won’t be a Money Morning on Bank Holiday Monday but we’ll be back on Tuesday.
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House prices rise 2.9% – will the recovery continue?House prices grew by 2.9% on an annual basis in September. Will Budget policies and ‘higher-for-longer’ rates dent the recovery?
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Nvidia earnings: what to expectNvidia announces earnings after market close on 20 November. What should investors expect from the semiconductor giant?
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UK wages grow at a record paceThe latest UK wages data will add pressure on the BoE to push interest rates even higher.
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Trapped in a time of zombie governmentIt’s not just companies that are eking out an existence, says Max King. The state is in the twilight zone too.
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America is in deep denial over debtThe downgrade in America’s credit rating was much criticised by the US government, says Alex Rankine. But was it a long time coming?
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UK economy avoids stagnation with surprise growthGross domestic product increased by 0.2% in the second quarter and by 0.5% in June
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Bank of England raises interest rates to 5.25%The Bank has hiked rates from 5% to 5.25%, marking the 14th increase in a row. We explain what it means for savers and homeowners - and whether more rate rises are on the horizon
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UK wage growth hits a record highStubborn inflation fuels wage growth, hitting a 20-year record high. But unemployment jumps
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UK inflation remains at 8.7% ‒ what it means for your moneyInflation was unmoved at 8.7% in the 12 months to May. What does this ‘sticky’ rate of inflation mean for your money?
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VICE bankruptcy: how did it happen?Was the VICE bankruptcy inevitable? We look into how the once multibillion-dollar came crashing down.
