David Fuller and Eoin Treacy's Comment of the Day
Category - General

    Tesla's Model 3 Sedan Production Cruises Past the 100,000 Mark

    This article by Tom Randall for Bloomberg may be of interest to subscribers. Here is a section:

    Expanded production comes with downsides, however. Tesla posted on its website Friday that buyers must place their orders by Oct. 15 to get their car by the end of the year and qualify for the expiring U.S. federal tax credit. Tesla was the first company to sell 200,000 electric cars cumulatively in the U.S., which triggers the gradual phase-out of the subsidy. The $7,500 credit will drop by half for Tesla on Jan. 1.

    Musk boasted in 2016 that Tesla would make more than 100,000 Model 3s by the end of 2017. It didn’t work out that way. As often happens on Musk time, Tesla arrived late to an impossible goal. But Model 3 production now appears to be cruising—from the first cars off the line in July 2017, it took about 14 months for the company to build the initial 100,000 Model 3s. At the current rate of production, it will build the second 100,000 in less than six months.

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    U.S. Treasury Staff Said to Find China Isn't Manipulating Yuan

    This article by Saleha Mohsin and Jenny Leonard for Bloomberg may be of interest to subscribers. Here is a section:

    Treasury said in its April report that it is considering expanding the number of countries it examines from 13, with analysts speculating that the number could go as high as 20. Such a move would be a sign of the Trump administration ramping up its use of the currency channel to negotiate better trade deals for the U.S.

    Mnuchin has said since July that Treasury is concerned about the yuan’s recent drop. The currency has slid more than 9 percent against the dollar in the last six months, raising speculation that China has been deliberately weakening its currency as tensions with the U.S. escalate.

    The Trump administration has pivoted to a more aggressive stance toward China since the president said last month the country is interfering in U.S. elections. Vice President Mike Pence delivered a speech last week in Washington signaling a firmer U.S. push-back against Beijing as trade anxiety weighs on the looming midterm congressional elections.

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    Fear Not, ETFs Control the Price of Gold

    This article by David Fickling for Bloomberg may be of interest to subscribers. Here is a section:

    That matches the big picture portrayed in demand statistics from the World Gold Council, an industry group. Bar and coin investors, industrial users and jewelry buyers purchase the yellow metal year-in and year-out; and central banks have been doing the same thing ever since they gave up their selling spree in 2009. As a result, ETFs and related funds are the key swing factor in the gold market, driving its slump from 2013 through 2015 when they became net sellers, and helping support its modest revival by turning into buyers in the years since.

    That relationship seems to have intensified of late. The raw beta when gold is the dependent variable jumped to 1.65 in the past three months, suggesting moves in ETF holdings are now having an even bigger influence on the spot metal than usual. 

    In some ways this doesn’t change the old argument for investing in gold, which is that the important beta isn’t related to ETF holdings but to stock-market returns. When fear rises and the value of your equity portfolio falls, the yellow metal still has a mild tendency to climb and offset the losses
    elsewhere.

    Still, those who look on gold as a refuge from the madness of crowds shouldn’t get ahead of themselves. These days, the crowds are in the driver’s seat.

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    Gold Gets a Second Look as Equities Reel and Inflation Cools

    This article by Marvin G. Perez for Bloomberg may be of interest to subscribers.

    Gold may have finally snapped out of its inertia.

    Prices headed for their biggest gain since March 2017 as of 10:51 a.m. in New York after a slump in global equity markets and data showing slower-than-expected U.S. inflation stoked demand for the metal as a store of value. Futures were set for a third straight gain, the longest rally since Aug. 22.

    Bullion, which touched a six-week-high $1,218.60 an ounce on Thursday, has traded near $1,200 since late August as traders weighed geopolitical risks that could boost the metal’s allure as a haven against rising interest rates that dampen its appeal.

    The inflation data may spur the Federal Reserve “to pump the brakes on further hikes,” Phil Streible, a senior commodity broker at RJO Futures, said in a telephone interview. The slump in global equities is also luring investors to “safe-haven” assets, he said.

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    China Shares Sink Most Since 2016 as 1,000 Stocks Fall by Limit

    This article by Kana Nishizawa for Bloomberg may be of interest to subscribers. Here is a section:

    Hong Kong didn’t fare much better, with the Hang Seng Index dropping 3.5 percent, the biggest in eight months. Tencent Holdings Ltd., the most valuable stock listed in Asia, slid 6.8 percent to extend a record losing streak to a 10th day.

    Chinese shares have been the ground zero for the trade war with the U.S. The Shanghai Composite has lost 24 percent in the past 12 months, one of the worst performers among 94 global gauges tracked by Bloomberg, with the majority of the decline happening this year. A slowing economy and weakening currency is only adding to the gloom.

    "Panic? The general mood among fund managers is more like ‘playing dead,’" said He Qi, portfolio manager at Huatai Pinebridge Fund Management.

    Telecom and technology shares led declines on the mainland, with ZTE Corp. and 360 Security Technology Inc. tumbling more than 9 percent. Tech shares also dropped the most in Hong Kong, following the sector’s rout in New York.

    Volume on the Hang Seng Index and China’s large-cap CSI 300 Index was about 70 percent more than their 30-day intraday average, according to data compiled by Bloomberg. Foreign investors dumped 3.6 billion yuan ($520 million) onshore shares through Hong Kong-China stock links. "It’s been a rough day," said William Wong, head of institutional sales trading at Shenwan Hongyuan Securities HK Ltd.  

    Institutional investors have been reducing their portfolio, while we see hedge funds shorting in Hong Kong." A crackdown at Chinese borders on undeclared goods also hurt luxury goods companies, with Prada SpA tumbling 10 percent, the most since September 2017. Jiangxi Ganfeng Lithium Co. dropped as much as 33 percent on its trading debut.

    "Negative sentiment is outweighing any positive catalysts, and investors would take any rebound as a chance to sell," said Louis Tse, Hong Kong-based managing director at VC Asset Management Ltd., adding that Shanghai shares may fall further after breaking the key support level. "If we’re talking about seeing an end of the tunnel -- I don’t think so."

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    Email of the day on immigration and retiring to Dubai

    Yes I know some expats who have retired in Dubai but I doubt if any labourer will be allowed to do so.
    2) Re Japan's immigration: I thought Germany used to have "guest" workers for it's factories who were there for as long as their work permits lasted and no citizen rights.

    And this from another subscriber

    I note you state in your comment that it is impossible to retire in Dubai when you stop working. This is no longer the case. The Dubai government has recently introduced new legislation that will allow anyone over 55 to remain in the country provided they qualify under certain monetary thresholds.

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