A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web
U.S. employment data was released Friday morning at 8:30 a.m.. The report announced 157,000 new jobs were created, when 193,000 were forecast by economists.
The Financial Times caught my attention with the headline “A copper-bottomed sign: why the metal is telling us to panic” Friday morning,
“Year to date, the metal has deflated by close to 18 per cent … Right now the copper price is saying we are not far from a more general sell-off in risk assets. Take a look at the copper price chart in 2008. The price was strong at the beginning of the year, peaked in May, and then fell like a lump of ore down a mine shaft.”
The reasoning includes a corresponding sell-off in Chinese equities although the column’s author, John Dizard, remains bullish on the copper price with a five year time horizon.
“A copper-bottomed sign: why the metal is telling us to panic’ – Financial Times (paywall)
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China’s Ministry of Commerce announced the country’s readiness to retaliate if the U.S. enacts more tariffs on the country’s goods with charges on US$60-billion in goods imported from the U.S.,
“China declared it will impose these new tariffs if the U.S. places more tariffs on Chinese imports. President Donald Trump is considering the U.S. raise proposed tariffs on $200 billion of Chinese goods to 25 percent from the 10 percent rate his administration is currently mulling, the administration announced Wednesday.”
“China says it will retaliate with tariffs on $60 billion in US goods” – CNBC
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Fund manager Mark Dow, a former economist at the U.S. Treasury Department, released a useful list of ways the financial crisis and its aftermath changed the understanding of how economics and markets intermix. The post was originally written last year, but has only recently been made available free of charge. Highlights include,
“Oil matters less. It didn’t help the consumer as much as forecast when it fell, and didn’t hurt GDP as much as others suggested, either. Oil intensity of GDP or share of consumption basket is far lower than the levels most observers—consciously or unconsciously—had anchored on. … Printing money can cause inflation, but doesn’t always. Asking what are the conditions under which it is likely to, and if those conditions obtain, is the smart question.’
“15 things global macro investors should have learned from the great financial crisis and aftermath” – Dow, Behavioural Macro
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On April 10, I disclosed that I bought a position in software firm Red Hat Inc. The stock rallied strongly afterwards but has come back to flat. I considered selling it, but Red Hat products are heavily involved in the spread of cloud computing, and reports like the recent one below are why I’m still holding,
“The true state of public cloud – 2018 survey report” – Thomson Reuters
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Tweet of the Day:
Diversion: “'I could feel my tongue going a bit numb': McDonald’s has served cleaning fluid to customers more than once” – CBC
Scott Barlow