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News & Politics

MoneyWeek Issue 1023

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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United Kingdom
Dennis Publishing UK
51 Issues

in this issue

3 min.
from the executive editor...

“Don’t listen to hopelessly partisan people, even when they claim to be experts” When Donald Trump was elected four years ago, one of the most memorable quotes of the day came from Nobel Prize-winning economist Paul Krugman. Writing in The New York Times in the immediate aftermath, at a time when futures trading indicated that markets were set to plunge, Krugman confidently stated: “If the question is when markets will recover, a first-pass answer is never”. Since that day, the US stockmarket – as measured by the S&P 500 index – has gained about 60%. Indeed, if you’d bought the index on election day, you’d have spent virtually no time at all in the red. So much for “never”. You can take quite a few useful lessons from this. One – don’t…

1 min.
neighbourhood watch

In the latest of “a long line of bitter quarrels between well-to-do neighbours in southern California’s most expensive neighbourhoods”, Bill Gross, co-founder of giant asset manager Pimco, has been accused of blaring the Gilligan’s Island theme song on a loop to “torment” his neighbour, tech entrepreneur Mark Towfiq, says Laurence Darmiento in The Los Angeles Times. The dispute, over a$1m outdoor sculpture, has escalated into “police calls to their Laguna Beach mansions” and several legal actions. Gross (pictured) bought the sculpture – a 22-foot-long blue glass installation – for his partner in 2019. The problems arose when a large netting structure was installed to protect it, which Towfiq claimed blocked his view. Following a complaint to the city by Towfiq, Gross began blaring music “at all hours” to force his…

1 min.
good week for

British cyclist Tao Geoghegan Hart (pictured) secured a cash prize of €115,668 after winning the Giro d’Italia in Milan, says Michelle Arthurs-Brennan on Cycling Weekly. The 25-year old is the second British man to win the race, adds the BBC. Chris Froome previously won the Giro in 2018, aged 33. Publisher Bloomsbury has said that people have “rediscovered the pleasure of reading” during lockdown, as it reported “its best half-year profits since 2008”, reports the BBC. Earnings rose by 60% to £4m between February and August as book sales soared. Recent Bloomsbury bestsellers included Why I’m No Longer Talking to White People about Race and Crescent City: House of Earth and Blood. Coverillustration: Adam Stower. Photos: ©Diageo/Knight Frank; GettyImages;iStockphotos ©Getty Images…

1 min.
bad week for

Pop Idol runner-up Gareth Gates revealed to The Sunday Times that he trades currencies, and once lost £250,000 investing with a foreign exchange “expert”. Gates, 36, invested with the trader after wealthy friends reported good initial results. But when the returns dried up after a year, “we... found out he’d blown the account... he obviously didn’t have good risk management in place”. A planned $375,000 deal for a box of collectable Pokémon trading cards ended in a nasty shock for the seller, says Archie Bland in The Guardian. Chris Camillo, host of YouTube channel Dumb Money, arranged to buy the cards from blockchain entrepreneur Jake Greenbaum, who himself had bought the box from a third party. They opened the sealed box live on YouTube – and found the cards were fake.…

2 min.
second wave grows as us election nears

The second wave of Covid-19 is buffeting global markets. Soaring case numbers and talk of new lockdowns in Europe resulted in the worst day in a month for America’s S&P 500 on Monday, with the index falling by 1.9%. Germany’s Dax had a shocker, plunging by more than 4% over the first two trading days of the week. This is a Covid-19 “reality check”, say Matt Phillips and Eshe Nelson in The New York Times. With cases also on the rise in America, investors are finally grasping what more lockdowns will mean for earnings, says Matt Maley of asset manager Miller Tabak + Co. The US Senate adjourned this week, all but killing hopes of a pre-election stimulus deal. The Vix index, Wall Street’s “fear” gauge measuring expected volatility, has hit…

1 min.
the topsy-turvy world of bonds

Stock and bond markets continue to send different signals. US Treasury bond yields plunged earlier this year as investors rushed into the traditional safe-haven asset. Bond yields move inversely to prices, so higher demand means higher bond prices and hence lower yields. Yet while stocks rallied over the summer, bond yields continued to send alarm signals. The US ten-year Treasury yield, which started the year at about 1.8%, fell to 0.5% over August. The start of this week saw gloom settle over equity markets, which would normally send bond yields even further south. Yet the US ten-year Treasury yield has barely budged, say Padhraic Garvey, Benjamin Schroeder and Antoine Bouvet of ING. Indeed, trading around 0.8% this week, it has risen since the summer lows. US bond movements also reflect the reflation trade…