A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the World Wide Web.
Global health-care stocks have been on fire in the past year and the sector is the main driver behind a post-crisis record for U.S. merger and acquisition activity.
The Atlantic's James Hamblin reports that the profit revolution in health care has only just begun, "'I believe we are on the cusp of an oil rush – a fabulous revolution of profit-making and cost-saving in health care,' Jonathan Bush told a rapt audience at the Aspen Ideas Festival last week."
I noted global health care as a secular growth theme in a recent column and now believe even more strongly in the sector as a long term investment theme.
"Health care, meet capitalism" – The Atlantic
"Not-Stupid Investing: Looking for Secular Growth Trends" - Inside the Market
Global agriculture is another pick for a long term investment theme, but in the case of fertilizers, it seems investors will have to wait for outsized profits. The Financial Times reports that eastern European fertilizer giant Uralkali increased potash output by 29 per cent in the most recent quarter despite a weak commodity price.
Uralkali has already stated its intention to reduce prices to increase global market share, particularly in China, and this is likely to depress fertilizer prices further, to the detriment of Potash Corp.
"Uralkali boosts Q2 potash output by 29%" – Financial Times
"Rio Tinto looks to catch up in potash" – Financial Times
I'm going to keep bringing this up – corporate debt markets are now far more extended and dangerous for investors than equities. This Bank of America Merrill Lynch chart is yet another example of investors sleepwalking into portfolio losses.
"Excesses are in credit market rather than stocks" – BoA, Twitter h/t @zatapatique
Inexplicably, General Motors increasingly dire reliability issues have yet to affect sales. An enormous chart detailing the company's product recalls this year highlights how bad quality control has become, and yet U.S. sales climbed one per cent in June.
"Is My Car Recalled? Our Massive Chart Shows Every GM Recall This Year"– Jalopnik
In an issue of *cough* more than passing importance here in the newsroom, Bloomberg's Megan McArdle argues that organized labour is more a reflection of wage power and immigration than a cause. Both sides of the argument are presented as Ms. McArdle writes, "Gage thinks it's no coincidence that the [labour] movement's glory days, and widespread declines in inequality, overlapped with the New Deal and the Great Society. I think so, too. I also think that it is no coincidence that all of those things overlapped with the Immigration Act of 1924 and the Smoot-Hawley Tariff Act."
"Inequality Isn't a Union Issue" - Megan McArdle, Bloomberg
Last year, The Atlantic reported the startling discovery that 59 per cent of all the "tuna" consumers were eating had nothing to do with an actual tuna fish. An update Wednesday helped explain why, noting that illegal fishing "accounts for $10 billion to $23.5 billion worth of fish per year, or up to 1,800 pounds of seafood stolen from the seas every second."
In related news, the Japanese government is finally drafting legislation to prevent over-fishing, possibly because the industry can no longer find any fish.
"Almost 1,800 pounds of seafood are illegally fished from the seas every second" – The Atlantic
"Japan Moves to Curb Overfishing" – Wall Street Journal
See also: "59% of the tuna Americans eat is not tuna" – The Atlantic (February, 2013)
Diversion: This is almost 10 years old but I hadn't seen it. A pre-Rolling Stone Matt Taibbi eviscerates Thomas Friedman's The World is Flat in a tour de force of mostly-justified cattiness. (warning: infrequent NSFW language)
"Flathead" – Matt Taibbi, NY Press
Follow Scott Barlow on Twitter @SBarlow_ROB
Scott Barlow