A roundup of what the Globe and Mail's market strategist Scott Barlow is reading this morning on the world wide web.
Understanding a global trade war, which U.S. President Donald Trump might kick off today with announcements on China-related tariffs, will be more difficult because the data on trade are misleading to the point of ridiculousness,
"But because of the way trade deficits are measured, almost all the value of [iPhone] components is attributed to China, which exports the final product. Reuters reports that 61 million iPhones were shipped from China to the US in 2017 and suggests that just a single phone — the iPhone 7 model, released in 2016 and on sale for all of last year — accounted for $15.7 billion of the trade deficit, or 4.4%."
In short, China gets credit in the data for making all the components of the iPhone even though they are sourced from all over the world.
"China estimate of the day" – Marginal Revolution
"Trump-China Trade War Sends Jitters Through U.S. Futures" – Bloomberg
(Peripherally) Related "The Great Inflation Mystery" – Business Week
"Trump set for China tariff announcement on Thursday, trade war fears grow" – Reuters
"China prepares for trade war" – Global Times
""If Trump really signs the order, that is a declaration of trade war with China," said Wei Jianguo, former vice commerce minister and now an executive deputy director of the China Center for International Economic Exchanges" – Bloomberg
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It's been a long time since I typed these words, but investors might want to keep an eye on BlackBerry Ltd.. The company's secure network is ideally suited to the auto industry where software updates and diagnostics can be done without a trip to the shop. BlackBerry has just signed a deal with Jaguar,
"BlackBerry, Jaguar Land Rover sign deal to work on connected cars" – BNN
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The Insurance and Investment Journal unwittingly supported my focus on Canadian retail sales data as a sign of slower domestic growth and the effects of household indebtedness,
"'Rising interest rates, moderating employment growth, and high household debt will force consumers to reduce their pace of spending this year,' said Matthew Stewart, Director, National Forecasting, The Conference Board of Canada. 'The hope that trade and business investment would pick up the slack is unlikely to come to fruition as uncertainty surrounding NAFTA negotiations and the possibility of increased tariffs are challenging businesses and exporters alike.'"
"Canadian economic growth is slowing down" - Insurance and Investment Journal
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Ritholtz's Michael Batnick makes the disturbing argument that things were a lot easier for our portfolio manager heroes,
"Most of the hedge fund titans came into the business in the late 70s or early 80s, when nobody wanted stocks. They weren't exactly shooting fish in a barrel, but there was much less competition than there is today. Not to take anything away from Paul Tudor Jones, but the stuff he was doing in his early years wouldn't work in today's league. According to the SEC, there are over 9,000 hedge funds that collectively manage $3.6 trillion. The easy pickings disappeared a long time ago."
"The Easy Pickings" – Irrelevant Investor
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Tweet of the Day: "@ajb_powell Quick update on Sidewalk Toronto, Google's 'consultation' on developing a new urban utopia where they DEFINITELY will look after your best interests. ftalphaville.ft.com/2018/03/21/152… " – Twitter
Diversion: This 1941 Harper's article was making the rounds on global finance twitter Thursday,
"Who Goes Nazi?" – Harper's