MoneyWeek 1071

MoneyWeek is a weekly magazine that enables you to become a better-informed, smarter investor and enjoy the rewards of managing your money with confidence. Week-in, week-out we'll guide you through the financial world as it changes, alerting you to all the opportunities to profit and dangers to avoid, as they appear. Income strategies, rising-star companies, the best funds and trusts, clever ways to preserve your wealth during market turmoil... you will get the best ideas from the sharpest financial minds and investing professionals in Britain.

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Dennis Publishing UK
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51 Issues

in this issue

3 min
from the editor-in-chief...

“A better predictor of stock performance than inflation levels is simply starting valuations” Gas prices are up. Oil prices are up (see page 4). Food prices are up. If you’ve noticed all this you aren’t alone. The Bank of England sees inflation hitting 4% by year-end and in a recent survey from Interactive Investor, 84% of people said they have noticed prices rising and 55% (quite rightly) view rising inflation as one of the biggest threats to their personal finances (the other 45% clearly aren’t concentrating…). The key thing to know then is whether our current inflation is transitory or not. Central bankers insist it will be gone by next year – most economists agree. For them the supply crunches – of everything from semiconductors to gas to workers – are…

1 min
while the boss is away...

A senior fund manager at Union Investment, one of Germany’s top asset managers, admitted to going on an insider trading spree as he felt “offended” after getting a smaller-than-expected pay rise, and suffering large losses from his investments in disgraced payments processor Wirecard, reports the Financial Times. The 45-year-old, who oversaw equity funds with €31bn in assets, was arrested by police a year ago. He used his insider knowledge to bet on shares using options (a type of derivative) just before the bank bought them (known as “front-running”). He banked €8.1m in total from 55 transactions between April and September 2020, telling judges at Frankfurt district court that it was easy to do, “as everyone else was working from home”. In one instance he bet €913,000 on Deutsche Post seconds…

1 min
good week for:

Euan Blair, son of former prime minister Tony Blair, is now worth over £160m – “almost certainly wealthier than his father”, says The Daily Telegraph – after his education technology start-up was valued at $875m (£646m) following a $130m funding round. The 37-year-old holds a 25% stake in Multiverse, which aims to connect companies with apprentices and school leavers. James Bond fans were finally treated to the last outing with Daniel Craig (pictured) asthe spy this week, after its release was delayed for 18 months by the pandemic. No Time To Die has a rumoured budget of $250m-$300m. “All eyes in the industry will be trained on Bond’s box office come October,” says the Evening Standard, although the record $1bn made by Skyfall in 2012 is probably “out of reach”.…

1 min
bad week for:

Dubliners will have to wait longer than expected for the MetroLink to connect Swords, a town near the capital, with Dublin Airport and the city centre. The project was meant to be finished by 2027 but transport minister Eamon Ryan has now admitted it was “never likely to be achievable”, says The Times. It’s expected to cost more than the €3bn initially budgeted and open in 2032 at the earliest. The Kunsten museum in Denmark has lost 534,000 kroner (£62,000) after lending it to an artist to replicate an earlier piece (which displayed the annual incomes of an Austrian and a Dane in glass cases), reports Bloomberg. When the museum opened the box that apparently contained artist Jens Haaning’s work, the cash was missing from the frames and the title had…

2 min
gas prices explode – and oil will follow

Brent crude oil prices have broken through $80 a barrel for the first time in almost three years. Oil’s rally comes as soaring European gas and coal prices presage a winter energy crisis. In September 2020 “in Europe it cost €119… to buy enough gas to heat the average home for a year”, says The Economist. “Today that figure is €738.” A cold European spring and a hot Asian summer, combined with a post-pandemic industrial rebound, have kept demand high. Imports of US liquefied natural gas (LNG) on ships will help ease the pressure a little, but global gas markets depend mainly on pipelines and are only “imperfectly linked”. Denting the global recovery “Gas storage tanks in Europe are only 72% full ahead of the winter season, compared with the usual 87% at…

1 min
china comes close to banning cryptocurrencies

Chinese regulators have moved one step closer to banning cryptocurrencies. On 24 September the People’s Bank of China (PBOC), the central bank, announced that “virtual currency-related business activities are illegal financial activities”. The bank blames cryptocurrency speculation for “breeding illegal and criminal activity”. Beijing’s crackdown on cryptocurrencies has been going on since 2013, says Scott Nover for Quartz. Earlier this year it banned financial institutions from providing crypto-related services. That edict had sent Chinese bitcoin buyers onto overseas platforms instead. The new rules seek to close that loophole. “Crypto transactions and crypto services of all kinds are banned in China,” says Henri Arslanian of PriceWatehouseCoopers. “No room for discussion. No grey areas.” The measures don’t appear to amount to an outright ban on cryptocurrency possession, says Andrew Griffin in The Independent.…