A roundup of what The Globe and Mail's market strategist Scott Barlow is reading today on the Web
I try and avoid Toronto-centrism in this column, but local housing price news – citing the worst month over month drop in real estate prices since 2000 – is worrisome enough to apply to B.C. and other formerly-hot markets across the country,
"The benchmark property price, which tracks a typical property over time, dropped 4.6 percent to C$773,000 ($613,000) from June. That's the biggest monthly drop since records for the price index began in 2000 … Prices are still up 18 percent from the same month a year ago…
"Transactions tumbled 40 percent to 5,921 on the year, the biggest year-over-year decline since 2009, led by detached homes. The average price, which includes all property types, rose 5 percent to C$746,218 from July 2016. "
"Toronto Home Prices Suffer Worst Monthly Decline in 17 Years" – Bloomberg
Also from Bloomberg, a report details the commodities that are set to benefit from electric vehicles, and the list goes well beyond lithium,
"some of the largest diversified miners like Glencore Plc argue fossil fuels such as coal and oil still play a crucial role supplying energy needs, they'll also benefit the most from a move to electric cars, requiring more cobalt, lithium, copper, aluminum and nickel…"For some of the metals, it's a complete game changer," said Simona Gambarini, a commodities economist at Capital Economics Ltd. in London."
"Electric-Car Revolution Shakes Up the Biggest Metals Markets" – Bloomberg
Research from Citi attempts to explain why economists have over-estimated inflation pressures in almost every year since the financial crisis,
"We discuss 10 potential reasons for the consistent inflation undershoots:
1. Inflation is being mismeasured. 2. The responsiveness of domestic input costs (eg wages) to domestic slack (eg labour market slack) has fallen. 3. The economy is more open and the shares of foreign input costs, final imports and exports have risen and with them the sensitivity of domestic price indices to foreign market conditions and slack. 4. The responsiveness of prices to input costs (including wages) has fallen 5. Greater than expected exchange rate appreciation and/or external inflation have lowered inflation. 6. Oil prices and/or other commodity prices have been lower-than-expected. 7. Inflation expectations are unusually and persistently low. 8. There is more labour market slack than estimated. 9. Capital (utilization) is being mismeasured. 10. The nature of production has changed. Input intensity has declined."
"@SBarlow_ROB Citi: Why economists over-estimate inflation" – (research excerpt) Twitter
Goldman Sachs listed the companies in line to benefit from the upcoming release of the iPhone 8,
"@SBarlow_ROB GS: iPhone 8 supply chain winners" – (Table) Twitter
A few stories of note for energy investors this morning,
"Oil steady as tighter U.S. market balances OPEC supply" – Reuters
"Oil's Going, Going, Gone: Crude's Worth Revealed at Auctions" – Bloomberg
"Pioneer Tumbles Most Since '08 After `Train-Wreck' Oil Wells" – Bloomberg
Tweet of the Day: "@JeoffHall Seasonal decline in crude oil inventories is longer and steeper this year than in the previous three years and could have eight weeks to go. " – (chart) Twitter
Diversion: "The Designer Baby Era Is Not Upon Us" – The Atlantic