Links of Interest 2019.Jun.21

Links of Interest is a weekly email that covers interesting links from the week and any news I find of interest to investors. You can subscribe to the Links of Interest newsletter here.

Good morning,

About 6 months have passed since the last Links of Interest, I hope you are surviving these turbulent times.

I’ve been busy with a number of things, mainly reading and research. I am now on Bloomberg (James Hull – Hull Research), feel free to IB me. I am writing more on this blog. The most popular posts recently are Trade War as Prisoner’s DilemmaTencent 1Q19 Earnings and Assets: Atoms versus Electrons

This week Patrick O’Shaughnessy had an amazing conversation with Chuck Akre, a long-term oriented fund manager, on his podcast (iTunes link). I listened to it twice in one day, and thought there were so many valuable insights I wrote up my favorite quotes and transcribed the whole conversation. (I’m crazy — I know. 😉

Below you will find the Links of Interest for this week. Thanks for reading. You can show your support by forwarding this to friends and colleagues. Your thoughts, questions and feedback are most welcome.   

And, finally, have a great weekend!  

Yours truly,
James

Subscribe to this newsletter here.


Links of Interest 2019.Jun.21

After a long half-year slumber, I am reviving Links of Interest. The last issue (24-Dec-2018) talked about Powell being hawkish: “after decades of dovish Fed Chairs, it seems the market isn’t ready for Powell.” That was the day Trump tweeted “The only problem our economy has is the Fed.” A lot has happened since then…

  • A complete 180 from Jerome Powell to pause, now a pivot to July rate cut
  • Trump tweets:
    • A tariff tweet, making trade tensions great again
    • Fed tweets, making a politicized Fed great again
    • Good conversation tweet, making trade negotiations great again
    • A Euro devalued tweet, making currency wars great again
  • A white paper from China on unfair treatment by the US
  • PBOC takes over of Baoshang bank and urges calm
  • Protests in Hong Kong secured an indefinite suspension of the extradition bill
  • US weighs more sanctions on Iran (falls right into the Dollar Constraint Hypothesis)
  • Tankers burning, a drone shot down (a $220m surveillance machine)
  • Trump approving air strikes on Iran then backing down
    • “Planes were in the air and ships were in position, but no missiles had been fired when word came to stand down, the official said.”
  • Predictably, Gold has been a major beneficiary of all this uncertainty

“Wow” just doesn’t seem to cut it. May you live in interesting times. Maybe all times are interesting times.

Also, we may really be in a “Techonomic” Cold War:

  • Huawei being added to the Entity List
  • US threatens to shut Germany out of shared intel networks
  • Six Chinese tech firms banned from exporting sensitive US goods
  • Google cuts off Huawei from some Android services
  • MIT cuts partnerships with China’s Huawei, ZTE
  • Intel ending 5G modem alliance with China chipmakers
  • Many companies moving production out of China
  • Many more asking suppliers to ‘look into the costs of moving’ (Apple)
  • Some companies that can’t find a solution right now (American Apparel)

I will end with this bit from a NYT piece that speaks to China’s reaction to the trade tensions, quoting a “popular blog post” that I have been unable to track down:

  • You’ve been opposing the U.S. for many years,” said the headline. “You should be long prepared that the U.S. will oppose you one day.”

Worth Your Time:

Concepts, learning
A Short History of the Most Important Economic Theory in Tech FastCompany      
(Hint: Brian Arthur’s increasing returns)
Going Critical MeltingAsphalt      
(some interactive learning on complexity theory, networks)

Trade Wars: Impact
Who’s Winning the Tech Cold War? A China vs. US Scoreboard Bloomberg
Apple Explores Moving Some Production Out of China WSJ
Lotte’s China Woes a Harbinger of South Korean Exodus FT  

Geopolitics
The Case for Restraint in the Gulf WSJ Opinion
The Politics of History: Why Anniversaries Matter in China MacroPolo

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