Weekly Reads: 01/22/2018
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Weekly Reads: 01/22/2018

The Week’s Best Articles: Week of January 22nd, 2018

Income: World’s Richest Gained 82% of Wealth Created in 2017 – click here
Income inequality has been an issue that is gaining more and more attention globally.  This issue is a topic that is attracting even more focus at the Davos conference.  According to Oxfam International their recent study suggests that the outstanding returns for risk assets in 2017 followed this trend.

Interest Rates: Does The Intensity of Rate Hikes Predict Recession – click here
Much has been made about the impact of rising interest rates here in the US.  Like is the case with most forecasts there are a variety of opinions on how the Fed should proceed.  While we don’t know what will ultimately happen it is important to try and continually understand the various factors that may impact the economy.  This author examines the frequency/intensity of rate increases and whether or not this can predict recession.

Business: Big Tech Goes To Big Energy – click here
Italian oil giant Eni has built a supercomputer the size of an soccer field.  They are hoping that using such strong computing power can help them better analyze their geological data to more accurately identify where the most successful new oil finds are.  While the cost is huge it far outweighs the cost of getting multiple oil sites incorrect.

Investing: The Shrinking US Risk Premium – click here
The debate about whether the US equity market is over or undervalued has been raging for what seems like years now.  This author does a good job of illustrating how simply looking beyond the standard PE ratio provides more nuanced indications on the market.

Investing: Hedge Funds Post Record Year – click here
For all the press during 2017 about the demise of hedge funds these statistics suggest something different.  In aggregate hedge funds posted gains of nearly 50% for the year to a total of $181 billion.  While we are not huge advocates of direct hedge fund investments for most clients those that do operate in that world need to be sure to focus on finding the highest quality managers.

Bitcoin: Rapper 50 Cent’s Big Bitcoin Break – click here
There have been several stories over the past several years about entertainment personalities missing out or benefiting from selling their services in bitcoin.  The most recent success story is rapper 50 Cent who allowed his fans to buy his album using the cryptocurrency.

Employment: Older Workers Account For All Net Job Growth Since 2000 – click here
The decline of the unemployment rate from the highs of the financial crisis is one example of how the economy has improved.  But underneath that number there is more nuance.  Specifically, that since 2000 all net job growth has been taken by workers age 55 and older.  This transition away from the “prime” working ages has profound impacts on our society and economy going forward.