Weekly Good Reads: 5-1-1
Shadow banking, investing in women, yield curve
Why 5-1-1?
Welcome to another issue of 5-1-1. Each week, I will include 3 links to relevant economic and investment news, 1 link to finance, and 1 to wellness pursuit based on what I read (5 links). I will also include 1 important chart and 1 investment term to know.
Market and Data Comments
The banking crisis eased this week when SVB found a buyer, First Citizens BancShares, and concerns about Deutsche Bank receded. Inflation as measured by the PCE (Personal Consumption Expenditures: excluding food and energy), the gauge liked by the Federal Reserve, rose 0.3% in February (5% year-on-year), compared to January’s 0.6% and less than expected.
In China, the legendary founder of China internet giant Alibaba Jack Ma is back on the tech scene. This may signify China wants to prioritize growth and open its arms to foreign investments.
In the meantime, Wall Street analysts from Morgan Stanley to J.P. Morgan warned future earnings growth expectations for the U. S. market are still too high. Moreover, regulators are watching closely the rise of shadow banking - debt provided by private equity funds, insurers, and retirement funds, as these funds have moved off banks’ balance sheets.
Economy and Investments:
A Key Measure of Inflation Slowed Down More than Economists Expected (Investopedia - first article)
Goldman Says AI Will Spur US Productivity Jump, Global Growth (FA Magazine)
Finance/Wealth:
Wellness:
Use This Simple Intimacy Concept to Attract People to You (on Medium, by May Pang)
One Chart You Should Not Miss:
There are 11 GICS (Global Industry Classification Standard) sectors in each equity market. Here is how they performed YTD and last year (a year you would like to forget unless you heavily invested in the energy sector.) The technology and communication sectors have roared back in Q1, with the market anticipating the interest rate will peak soon and the Fed might even cut rates by over 50bp (still a market guesstimate.) Reading the economic news is still more important than being FOMO.
One Term to Know: Yield Curve and its Use in Investing
You will find explanations of a normal, inverted, and flat yield curve (note: a normal yield curve is upward-sloping, but currently, we have inverted yield curves.)
Please do not hesitate to get in touch if any questions!