The World’s Biggest Economies In 2050

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PWC Global has come out with a report that sets out its long-term growth projections for the world’s largest economies.

LINK: World in 2050 (PWC)

Here is a quick summary of their forecast:

“Key results of our analysis (as summarised also in the accompanying video) include:

The world economy could more than double in size by 2050, far outstripping population growth, due to continued technology-driven productivity improvements

Emerging markets (E7) could grow around twice as fast as advanced economies (G7) on average

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OUR JANUARY RESULTS – A GREAT START TO 2017

OUR JANUARY RESULTS – A GREAT START TO 2017

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Our weighted average return in January was +2.38% (net of fees).

Our core bond holdings continued to deliver stable returns and our equity performance was outstanding. Our decision to maximize our exposure to technology stocks in November and December of last year delivered immediate rewards. Here is how our top three individual equity holdings performed last month:

1) Amazon +11%
2) Facebook +15.80%
3) Shopify +19.41%

Our rotation into emerging markets and our investments in the biotechnology sector also contributed to our strong outperformance of the S&P 500 (SPY US), which had total return of 1.79%. We also outperformed emerging market bonds (EMB US: +1.73%) and investment grade bonds (BND US: +0.19%) by a considerable margin.

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Unexpected Consequences of Self-Driving Cars And The One Thing That Will Never Change

Full disclosure: I am not a ‘car guy’.

I can appreciate a fine automobile and enjoy watching “Top Gear”/”Grand Tour”, but I only got my driver’s license because I met a girl that I really liked who lived in the suburbs. Driving for me has always been a means to an end, not an end in itself. I have enjoyed open stretches of scenic highway, but driving in urban environments gives me no joy, and that is one of the main reasons that I cannot wait for self-driving cars.

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How Major Asset Classes Performed In January

In a world inundated with terms like ‘alternate facts’ and ‘post truth’ we take comfort in numbers.

Our business is simple, you make money for your clients or you don’t. No amount of academic accreditations, algorithms or excuses can compensate for not making successful investment decisions (see ‘Long Term Capital Management’…).

Here is how major asset classes performed in January:

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LINK: Major Asset Class Performance January 2017

And here is the performance of our top equity holdings:
top 10

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The Five Trades That Most People Have Gotten Wrong – But We Have Gotten Right…

LINK: Five Trades That Most Have Gotten Wrong

1) Short Trump

*** we have added to equity positions ***

2) Long Dollar

*** our USD exposure in Euro accounts is completely hedged ***

3) Short bonds

*** we did not flee bonds and have added to names we like on price weakness ***

4) Long Banks

*** we do not have any targeted exposure to bank stocks ***

5) Short Healthcare

*** we have held onto our healthcare positions and have added to our biotech holdings on dips ***

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Amazon, Facebook, Google Could Replace Banks

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Banking has a fascinating history, and has played a seminal role in the forging of the modern world.

Today, as banks furiously try to keep up with technologies and new ways of attracting and maintaining clients, it bears consideration as to what their roles will be in the future. Will they fall pray to today’s aggregators and connectors? Quite possibly.

In a world where more and more of your everyday purchases are sourced from Amazon, why not carry a balance on your Amazon account? Surely they could come up with enticing reasons for you to do so. Looking for a loan? Surely Google could personalize and rank your best options. Need to make a payment? Facebook has a decently sized network of users (1.6 billion and counting)…

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