Tech Review | Why Communist China Has So Many Tech Billionaires

Tech Review (TR 2019-01-19)--Domain Mondo's weekly review of tech investing news: Features • 1) Why Communist China Has So Many Tech Billionaires, 2)Ecommerce: Online Spending Putting Traditional Retailers Under Pressure, 3) Investing: The Week; Notes: Why You Can't Trust Most "Financial News" and more,  4)ICYMI Tech News: Amazon AWS, Facebook, Tencent, Robotics, 5G, Apple, IBM, Vodafone, and more. 

1) Why Communist China Has So Many Tech Billionaires

By one estimate, China mints a new billionaire every two days, far exceeding the rate of countries like the United States. But how did China remain a nominally Communist state while becoming a hotbed for billionaires-in-the-making? Bloomberg QuickTake explains how capitalist compromises and moves begun decades ago have made China the not-quite-Communist country it is today. Featured: Jack Ma, co-founder of Alibaba Group (alibabagroup.com) $BABA. Bloomberg (bloomberg.com) video above published Jan 9, 2019.

2) Online Spending Putting Traditional Retailers Under Pressure

Richard Lim, CEO of Retail Economics (retaileconomics.co.uk), discusses the U.K. retail sector after M&S and John Lewis suffered their worst Christmas sales since the financial crisis. CNBC International TV video above published Jan 10, 2019. #retail #ecommerce #bricknmortar

Ecommerce & Truckers: since consumers now buy online appliances, treadmills, outdoor grills, etc., national trucking companies are buying up local delivery operators.--bloomberg.com.

3) Investing

The Week: NASDAQ Composite +2.7% | S&P 500 Index +2.9% | DJIA +3.0%

Notes: Why You Can't Trust Most "Financial News"

Article out today with my name in the headline. No interview. No fact check. Reporter sent an email saying “hope this is accurate”. Sheesh.

— Jeffrey Gundlach (@TruthGundlach) January 13, 2019

To be clear: “Hope this is accurate” email was sent with a link to the article, but only after the article was already run in global media.

— Jeffrey Gundlach (@TruthGundlach) January 13, 2019

Editor's note: "Hope is not a strategy."

Other Notes:

• China signals more stimulus as economic slowdown deepens--reuters.com.
• Eurozone: risks besieging European Bonds spill over into 2019--bloomberg.com.
• Germany: German GDP grew 1.5% in 2018, compared with 2.2% in 2017, the weakest growth rate in five years--Federal Statistics Office (Destatis) (flash data).
• Why digital strategies fail: for most companies, the pace of disruption is uneven, and they can’t just walk away from existing businesses. They need to digitize their current businesses and innovate new models--mckinsey.com.
• WeWork a/k/a WeCompany: "You can’t put lipstick on a property gamble and call it a Tech paradigm shift"--morningporridge.com: "Softbank founder Masayoshi Son was the perfect mark"--Editor's note: We Work was expecting a $16 bln capital injection from Softbank’s Visionfund.
• Index funds are dominated by only three asset management firms--Vanguard (Jack Bogle RIP), BlackRock, and State Street Global--marketwatch.com. 
• Brexit: UK Government's next steps will be tabled on Monday 21 January. It will be debated Tuesday 29 January.  Most likely now: renegotiate withdrawal agreement or leave with "no deal" March 29, 2019. More on Brexit here.

4) ICYMI Tech News:

• Amazon Web Services announced Jan 16, 2019, AWS Backup, its fully-managed, centralized service for customers to back up their data from across AWS services and on-premises--press.aboutamazon.com. 
• German antitrust order in the works re Facebook and user data--reuters.com. FTC (US) commissioners met to discuss imposing a record-setting fine against Facebook for failing to safeguard user privacy, violating 2011 consent decree--TheHill.com.  
• UK engineers have finished building Quantum, the first fully software-defined communications satellite that can be reprogrammed in orbit, launching this year--bbc.com.
• Tencent's Xiaowei, AI voice assistant for WeChat, integrates with Tencent's own services and apps by third-parties such as Meituan or Didi.
• 10 robotics companies to watch in 2019--therobotreport.com.
• 5G network and deployment, investment implications--seekingalpha.com. Qualcomm says every Android phone maker will beat Apple to 5G.
• IBM links up with Vodafone for $550m cloud computing contract--cityam.com.

-- John Poole, Editor, Domain Mondo  

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DISCLAIMER

Trump Era: Markets, IPOs, Economy, Trade, Tax Reform, 4% Growth?

S&P 500 Index (source google.com)

The S&P 500 closed up Wednesday (chart above) and has gained 6.18% since Trump's election on Nov. 8th.

Tom Barrack on Donald Trump's Inauguration and Cabinet Picks:

Video above published Jan 18, 2017: Colony Capital Founder and Executive Chairman Tom Barrack discusses the inauguration of President-Elect Donald Trump and the make-up of his cabinet.

JPMorgan CEO Jamie Dimon: Donald Trump's Reforms Could Cause Economic Growth

Video above published Jan 18, 2017: At the World Economic Forum in Davos, JPMorgan CEO Jamie Dimon talks about tax reform and President-elect Trump's economic policies.

NYSE Chief: Trump May Bring Better Times for Public Companies:

NYSE President Tom Farley discusses the markets under a Trump administration and his outlook for the future for public companies and IPOs. He speaks with Erik Schatzker from the World Economic Forum in Davos, Switzerland on "Bloomberg Markets" on January 17, 2017.

Wilbur Ross: I'm Not Anti-Trade, I'm Pro-Sensible Trade

Video above published Jan 18, 2017: Wilbur Ross, chairman and chief strategy officer at WL Ross testifies at his confirmation hearing for Secretary of Commerce. Full hearing video here.

Dow Chemical CEO: 4% Growth Is Possible Under Trump

Video above published Jan 17, 2017: Andrew Liveris, Dow Chemical CEO, explains what is needed to spark four percent growth in the U.S. economy and shares the details of talks with President-elect Donald Trump on stimulating manufacturing growth. He speaks with Bloomberg's Erik Schatzker from the World Economic Forum in Davos, Switzerland on "Bloomberg Daybreak: Americas."


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DISCLAIMER

Dow Heading for 20,000, Stocks Rise, Gold Falls Ahead of Fed Rate Hike

Blue-chip index nears milestone as tech joins the Trump rally--Traders assign 100% odds to a Fed rate hike on Wednesday:

DJIA 3-month chart (source: google.com)

S&P500 Index (source: google.com)

Fed Interest Rate Hike Bad News For China? At the Federal Reserve Open Market Committee (FOMC) meeting on Wednesday, an interest rate hike of 0.25% is expected. This rate hike will be only the second increase by the Federal Reserve in 10 years (the first increase took place December 2015). This may have ramifications on emerging markets in general and China in particular which faces an economic slowdown. A U.S. interest rate increase will likely increase capital outflows and generate additional growth headwinds for China. 

Headlines Tuesday leading up to the expected Fed Rate Hike:

Dow Heads for 20,000 as Stocks Rise, Gold Falls: "Global stocks advanced, sending the Dow Jones Industrial Average within 50 points of 20,000 on speculation that the Federal Reserve’s expected rate increase is a signal of confidence that the economy is strengthening. The dollar and Treasuries were little changed. IBM Corp. and Intel Corp. led gains in the blue-chip index as it heads for a fresh record and the round-number milestone ... Its relative-strength index stood at the highest level in two decades ..."--Bloomberg.com

IBM Lays Out Plans to Hire 25,000 in U.S. Ahead of Trump Meeting: "IBM Chief Executive Officer Ginni Rometty said she plans to hire about 25,000 people in the U.S. and invest $1 billion over the next four years, laying out her vision for filling technology jobs in America on the eve of a meeting of industry leaders with President-elect Donald Trump. Rometty, who is on Trump’s advisory panel of business leaders, will join Facebook Inc.’s Sheryl Sandberg, Amazon.com Inc.’s Jeff Bezos and Alphabet Inc.’s Larry Page and Eric Schmidt at a summit with Trump Wednesday in New York that is said to focus on jobs."--Bloomberg.com

Small Business Owners' Optimism Skyrockets Following Trump Victory: "The November reading of the National Federation of Independent Businesses' small business optimism index jumped to 98.4 from 94.9 — its sharpest surge since 2009 — with all of the increase in sentiment coming after the U.S. elections held on Nov. 8."--Bloomberg.com

After talking with Trump, Bill Gates likens president-elect to JFK: "... in the same way President Kennedy talked about the space mission and got the country behind that, I think whether it's education or stopping epidemics ... [or] in this energy space, there can be a very upbeat message that [Trump's] administration [is] going to organize things, get rid of regulatory barriers, and have American leadership through innovation ... Of course, my whole career has been along those lines. And he was interested in listening to that. And I'm sure there will be further conversation."--Microsoft co-founder Bill Gates after recently speaking with Trump--CNBC.com.

"Allegations of Hacking Election Are Baseless" Say High-Level American Intelligence Officials: "The various ways in which usually anonymous spokespeople for U.S. intelligence agencies are equivocating – saying things like “our best guess” or “our opinion” or “our estimate” etc. – shows that the emails alleged to have been “hacked” cannot be traced across the network. Given NSA’s extensive trace capability, we conclude that DNC and HRC servers alleged to have been hacked were, in fact, not hacked."--WashingtonsBlog.com

Obama Says No Evidence that Russia Tampered with Votes in Election: During an interview with the Daily Show’s Trevor Noah, Obama downplayed the hack of a private email account of Clinton campaign chief John Podesta. "We were frankly more concerned in the run up to the election to the possibilities of vote tampering, which we did not see evidence of, and we’re confident that we can guard against ... None of this should be a big surprise,” Obama said, “Russia trying to influence our elections dates back to the Soviet Union.” Obama dismissed the hack and the leaked emails as “not very interesting” and lacking “explosive” revelations. He puzzled as to why it was an “obsession” by the news media despite the knowledge that the Russians were responsible.--Breitbart.com.

Trump's selection of  Tillerson lifts hope of US rapprochement in Moscow: "Sergei Karaganov, one of Russia's most senior foreign policy hands, says the difference is that Tillerson is a hard-nosed pragmatist who [as Secretary of State] will focus on getting things done, and leave aside the many political and philosophical issues where Russia and the US will never agree. Like many in Moscow's upper circles, Mr. Karaganov has met Tillerson and says that his ratification would be a signal that genuine and lasting detente between the two powers is a real possibility."--CSMonitor.com

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DISCLAIMER

Back to square one? US Economy Now Driving Global Growth (video)

Back to square one? | Authers' Note -John Authers reports on US GDP numbers that eased recession fears. (FT.com, Feb 26, 2016)

@zerohedge "You don't buy GDP futures. You buy S&P 500 futures."
So Jonathan Golub is dead wrong on this.

— Douglas Kass (@DougKass) February 24, 2016

S&P 500 futures signal more stock losses on oil as banks slide https://t.co/QvnDiYSi7X pic.twitter.com/GV6OWwZ1DU

— Bloomberg Business (@business) February 24, 2016

S&P 500 Index 3-month chart (source: google.com)

Finally, ICYMI--Warren Buffett’s 50th annual letter to shareholders--BerkshireHathaway.com (pdf)

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DISCLAIMER

FED Aftermath: Stocks Fall, Markets, Economy, Commodities (video)

S&P 500 Index, December 17, 2015 (source: google.com)

"U.S. stocks dropped, ending the Standard & Poor’s 500 Index’s three-day rally, as investors moved past the Federal Reserve’s interest-rate increase and returned their focus to weakness in commodities and prospects for global growth. A stronger dollar in the wake of the Fed’s move weighed on energy and raw-material shares, as crude tumbled below $35 a barrel... The [S&P 500] index slipped below its average prices during the past 50 and 200 days." - source: U.S. Stocks Erase Post-Fed Rally, Commodity Shares Lead Retreat - Bloomberg Business

Bond markets discount Fed’s estimates | FT Markets - FT markets editor Michael MacKenzie assesses market reaction to the Federal Reserve’s rate rise. He examines the discounting by bond markets of the Fed’s view on future rates and the possibility of a volatile 2016 if there is a firmer US recovery. Published on Dec 17, 2015

Above: Excerpt from "Economic projections of Federal Reserve Board members and Federal Reserve Bank presidents under their individual assessments of projected appropriate monetary policy, December 2015." Advance release of table 1 of the Summary of Economic Projections released with the FOMC minutes. See the full documents and notes here and below:

Information:

FOMC Meeting Statement:
PDF | HTML (Released December 16, 2015 at 2:00 p.m.)
Projections Materials:
PDF | Accessible Materials
Transcript (205 KB PDF)

See also on Domain Mondo:

• Milton Berg: Commodities May Sink 20% More, Equities in Bear Market
• FED FOMC Rate Hike, Press Conference Video Replay, Transcript
• Return to Normality? FED Set To Raise Rates for First Time Since 2006

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DISCLAIMER

August is the Worst Month for Investors since 1987

S&P 500 Index 3 month chart (source: google.com)

Above the S&P 500 Index 3 month chart - check currently: SP500 Index (via google.com)

Hooper: Stock Trader's Almanac says since 1987, Aug. is worst month for #DowJones, #SP500 & #NASDAQ. #TheUpshot http://t.co/1CjiXJmQv5

— AllianzGI US (@AllianzGI_US) August 21, 2015

THE WORLD IS BURNING #china #EM #summerfridays pic.twitter.com/loJ9WDB7Jk

— Katia Porzecanski (@KatiaPorzo) August 21, 2015

See also: Allianz Global Investors | 5 Reasons August May Take Investors for a Ride


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