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MoneyWeek Issue 1014

There's a reason MoneyWeek is Britain's best-selling financial magazine. We exist to help you ground your portfolio so that it keeps your money safe during rough patches and growing in the good times. We don't just look at how to maximise your returns and limit your losses, we also like to look at how you can keep more of the money you've made. 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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United Kingdom
Dennis Publishing UK
51 Issues

in this issue

3 min.
from the editor...

“Solid investment themes, like Chanel suits, always come back into fashion” We have been gold bugs since 2001 (and still are – see page 5). Another longtime favourite of ours is Vietnam. In 2005 we noted that it was Asia’s “other communist dynamo” (it still is). In 2007 the International Monetary Fund’s (IMF) chief economist referred to it as an “emerging China”. The IMF may have failed to forecast the global financial crisis in 2008, but that time it was on the money. Vietnam piqued our interest because it seemed to be following in China’s footsteps with a ten-year delay. It embraced the free market in the mid-1980s, and since then has attracted attention as a cheap manufacturing base: wages are around a third of Chinese levels. It has also moved up…

1 min.
loser of the week

Ride-hailing app Uber is once again in the news for the wrong reasons. Joseph Sullivan, the group’s former chief security officer, has been charged with covering up a data breach, says Edvard Pettersson on Bloomberg. The breach, which occurred in 2016, compromised the personal data of over 57 million employees and users, and was resolved only when Sullivan authorised the payment of $100,000 in bitcoin to the perpetrators. The hacking incident was initially classed under Uber’s “bug bounty” programme, whereby companies pay people to identify flaws in their security networks. But prosecutors say this was a huge breach that shouldn’t have been passed off as a bug bounty episode; the programme normally caps payments at $10,000. Coverillustration: Adam Stower. Photos: Apple Inc; Getty Images;iStockphotos©Getty Images…

1 min.
good week for:

Online booking company Airbnb announced on Wednesday that it has filed for an initial public offering (IPO), says Levi Sumagaysay in MarketWatch. The group had long been expected to go public this year, but the Covid-19-induced downturn in the global travel and hospitality sectors cast doubt on the move. However, it makes sense, reckon analysts. “People have been cooped up, and the virus-safe option is renting a house,” says Tom White of broker D.A. Davidson. Mike Ashley, the owner of Sports Direct, has bought long-time competitor DW Sports Fitness out of administration, says BBC News. Ashley’s Frasers Group offered £37m to merge the leisure and retail company with his own, taking ownership of its clubs and stores. This means he has won a 20-year feud with rival businessman and former football…

1 min.
bad week for:

The Iga-ryu Ninja Museum in Japan has been pillaged by thieves. The museum showcases ninja tools and trains clients from around the world in the art of stealth. Its admissions-fee safe, containing more than ¥3,000,000 (£21,240), was stealthily removed in the early hours last Thursday and has yet to be retrieved. A father from North Tyneside has been saddled with £19,000 of debt after his six-year-old son inadvertently purchased a monster truck using his eBay account, says Nicole Conner in the Daily Mail. Mohammad Faraji had left his laptop open and his monster-truck obsessed son decided to purchase an early birthday present. The seller has refused his requests to refund the money.…

2 min.
us market is weaker than it looks

Onwards and upwards. America’s S&P 500 surpassed February’s highs last week, wiping out its pandemic losses. It is now up 5% for the year. The MSCI World index came within 1% of its February record early this week. Yet the new peaks obscure a market where the winning stocks and sectors have soared while many others remain under water, creating a “K-shaped” recovery chart. More losers than winners Surging US technology valuations have been the cornerstone of the stockmarket’s unlikely recovery. The collective valuation of just five companies (Apple, Microsoft, Amazon, Alphabet – Google’s parent company – and Facebook) now eclipses Japan’s entire Topix index, say Richard Henderson and Eric Platt in the Financial Times. Yet the average S&P 500 stock is still 28.4% below the pre-pandemic peaks. The gaping chasm between the…

1 min.
is the us dollar due a bounce?

The dollar’s fortunes could be set to improve, says Neal Kimberley in the South China Morning Post. The US Dollar Index, which measures the greenback’s value against a basket of six other major currencies, has tumbled by more than 9% since March. But the further the dollar falls the more difficult it becomes to argue that it is still overvalued. New European coronavirus outbreaks have taken some of the shine off the rally yin the euro. The dollar’s valuation still faces short-term headwinds, says Nouriel Roubini for Project Syndicate. Federal Reserve monetary policy is even looser than that of other major central banks. Yet in the longer term the currency’s underlying strengths, the dynamism of US companies and the unsurpassed scale and liquidity of the dollar bond market, are likely to…