A roundup of what The Globe and Mail's market strategist Scott Barlow is reading this morning on the Web
North American employment numbers are crossing the wire at the time of writing. In Canada, 19,400 jobs were created when 5000 was expected, and in the U.S., 98,000 new jobs were reported versus 180,000 expected. Importantly, U.S. wage growth was reported 2.7 per cent higher, in line with forecasts.
Markets this morning are only marginally affected by the U.S. bombing of Syria overnight. Oil is trading slightly higher at $52.15 per barrel, the U.S. dollar and Japanese yen are rising in an apparent flight to safety and Raytheon Co., makers of Tomahawk missiles, is two per cent stronger in pre-market trading.
"U.S. fires missiles at Assad airbase; Russia denounces 'aggression'" – Reuters
"Here's What Trump's Syria Strike Did to Markets, as Impact Eases" – Bloomberg
"Asian energy stocks rally after Syria missile strike" – FastFT
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Today's must-read feature is by Bloomberg, detailing all of the statistical shenanigans that deceive investors while making Wall Street (and Bay Street) rich,
"Mass-market products such as exchange-traded funds are being concocted using the same flawed statistical techniques you find in scholarly journals. Most of the empirical research in finance is likely false, Harvey wrote in a paper with a Duke colleague, Yan Liu, in 2014. 'This implies that half the financial products (promising outperformance) that companies are selling to clients are false.'"
"Lies, Damn Lies, and Financial Statistics" – Bloomberg
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JP Morgan CEO Jamie Dimon argued that capital requirements for banks are too restrictive and are hurting the economy. FT Alphaville's Matthew Klein calls 'shenanigans' on this view,
"But equity is still the most important thing, as a new research paper from Simon Firestone, Amy Lorenc, and Ben Ranish at the Federal Reserve Board makes clear. ... They concluded the US economy would be better off with more equity in the banking system under all the possible assumptions they tested, with the optimal capital ratio potentially more than double what it is now. Considering this comes from staff economists at America's most important banking regulator, you should pay attention to their reasoning."
"Sorry Jamie, Fed economists think bank capital is still too low" – Klein FT Alphaville
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News that Amazon has acquired broadcasting rights to NFL football games highlights what could be the slow death of the current cable television business model. Personally, I'm planning to cut the cord right after The Masters is over this Sunday,
"These tech-plus-sports contracts are baby steps. But you may have noticed those tech companies have a lot of money. A lot. Amazon generates $50 million in operating cash flow in about 27 hours. It's easy to imagine that the NFL and other big-ticket sports leagues are eager to keep their bank vaults stuffed by playing the tech giants against the TV executives. My Bloomberg News colleagues reported that the football league's strategy is to stretch out the drama until 2021, when the NFL's TV deals start to expire. Then Google -- market cap $580 billion -- can go head-to-head (or wallet-to-wallet) with CBS and its $31 billion market cap."
"Tech Comes Off Bench to Show Sports" – Gadfly
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Tweet of the Day: "@galka_max The $74 trillion global economy in one chart howmuch.net/articles/the-g… " – Twitter
Diversion: "Self-Deception II: Splitting" – Psychology Today
Scott Barlow