Investment Gems

Summary Assessing the duration of the lockdown is the real key to understand the impact on the economy. Industries a with high proportion of fixed costs will be more vulnerable to a long stint. We assess the possible impact of the lockdown on US automakers. Make no mistake. The current…

Photo credit: Federalreserve The credit market will be pivotal during the current crisis. In 2008, we had a problem in the credit market (Subprime mortgages), which made financial institutions move into credit tightening mode. Soon, that start cascading into the real economy. The current environment inverts that relation. The problems…

Source: Philip Taylor Gold underperformance during periods of panic is not new. If you look at the great financial crisis, you’ll see that the same happened then. The gold price peaked in July and then went on to lose 27% of its value. Source: Seeking Alpha More interestingly, gold then…

Summary A couple of weeks ago, I proposed that the virus would make an impact on the economy, and, by default, on the complacent market. Now, it seems like the virus is spreading out of China, and the biggest world economies are activating the debate around stimulus. Big organizations will…

Summary The virus seems more contagious, but less fatal than the SARS 2003 outbreak. The fact that it might be more contagious increases the likelihood of negative economic impact. With the stock market near all-time highs, we wonder if investors will maintain the confidence from end of 2019. Photo credit:…

Summary The auto industry has been dealing with compressed earnings multiples for some time now. The market identifies traditional automakers as value traps. Automakers will need to break into growth segments of the industry to invert the perceptions. The new Ford Mustang Mach-E might be Ford’s answer to that problem.…

Summary Analysts and market participants are fretting about Kate Spade. However, so far, Kate Spade is using the same tactics that Coach used in its turnaround. And, therefore, is suffering from the same symptoms. There is potential for a successful turnaround, however, the current slump in the share price might…

Summary Tech stocks have performed incredibly well during the last five years. However, the current monetary and fiscal setup will likely cause another leg-up in the bull market, followed by some form of crash. Technology stocks will suffer, but, in time, they will roar back. Photo credit: Luca Sbardella Tech…