Scott Barlow
A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the Web
Few technology strategists are more respected than KPCB's Mary Meeker, and her annual report on the state of the industry is an important date on the calendar for investors in the sector. Released Wednesday, this year's summary was relatively downbeat with the conclusion that the boom times are over.
The report is huge at 213 pages (in presentation slide form) and, as usual, included some horrifying data for my own business. Other conclusions include a slowdown in the rate of global smartphone usage growth, the sharp rise in technology company acquisitions by non-technology companies (particularly auto makers), and the divergent technology use by the millennials and the younger Generation Z.
Technology professional Dan Romero presented a nice bullet point summary of the report on Twitter here.
"Internet trends 2016" – Meeker, KPCB
"Internet Boom Times Are Over, Says Mary Meeker's Influential Report" – Bloomberg
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Oil is trading close to the $50 level this morning and the mood at the ongoing OPEC meetings are far more upbeat than earlier in the year. Saudi Arabia's new Oil Minister Khalid Al-Falih noted confidently that "the worst is clearly behind us" during an interview on Bloomberg Television.
"Saudi Oil Minister Al-Falih Says OPEC Strategy Is Working" – Bloomberg (video)
"The Offshore Oil Business Is Crippled And It May Never Recover" –Yahoo! Finance
"Saudi Arabian energy minister says Opec must 'steward' oil market" – Financial Times
"Iran Resists Saudi Gesture for Unity as OPEC Fractures Reappear" – Bloomberg
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There are theories, but economists in general continue to express confusion about the drastic slowdown in global trade. As OECD officials noted Wednesday, the current environment where trade growth is below global GDP growth has only happened five times previously, and signalled a significant slowdown in the world economy each time.
FT Alphaville cites economist Caroline Freund from the Peterson Institute regarding the rising risk of a trade-related downward spiral in global economic activity,
"Trade also works to transmit the investment slump across countries. Year-on-year growth in private investment in advanced countries was 2.1 per cent 2010-2014, versus 3.3 per cent during the pre-crisis period. As a result of slowing investment, advanced-country import demand fell. As exports from emerging markets slowed, investment in those countries also dropped. In the last couple of years, investment's share of GDP has declined in Brazil, Russia, India and China. If the trade slowdown is just a symptom, does it matter? Yes, because weak trade growth is promulgating the investment slump across countries."
"The trade-investment disappointment loop" – Garcia, FT Alphaville
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The cost of being bullish on gold prices is rising. This is a technical matter. But might have a negative effect on bullion in the weeks ahead,
"The cost of rolling futures into a later-dated contract was recently the highest in about six years, said Bernard Sin, head of currency and metal trading at Geneva-based refiner MKS (Switzerland) SA. Those holding June futures would have paid an extra $3.40 an ounce on May 23 to swap that position for the most-active August contract, Comex data show."
"Gold Traders Pay Most in Years to Keep Big Bullish Bet Alive" – Bloomberg
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Tweet of the Day: "@amberkanwar Astounding: Since the last Fed meeting in march, there have been *24* rate cuts in emerging markets via @CanaccorGenuity's Martin Roberge " – Twitter
Diversion: The headline in this case, misrepresents the content of the essay in my opinion which is far more even handed,
"Global-Warming Alarmists, You're Doing It Wrong" – McArdle, Bloomberg View