Posts Tagged ‘economic recovery’

My top 10 investment and disinvestment areas for 2014

January 2, 2014

I am relatively new to the world of personal investments and these are just based on my personal gut-feel:

  1. Oil and Gas companies – but only if they also have – or acquire – fracking reserves. I am staying away from those  gas producers who are overly dependent on “conventional” natural gas and have not embraced shale gas. If the economic recovery (globally) is confirned by Q2 then the “blue chip” oil companies become attractive again.
  2. I shall get out of wind and solar energy developers. Subsidies are declining and developers and plant operators are going to be hard pushed to retain their advantages. On the other hand manufacturers of unconventional energy equipment (off-shore wind, fuel cells, batteries, geothermal ….) and who are really spending their own money on R & D (as opposed to spending government grants) are attractive in the long term.
  3. Even with a solid economic recovery, there will be a time lag before the demand for special steels and other metals picks up. Metals and mining may becoming interesting again but only at the end of the year. Australian mining becomes attractive if the “green” burdens are lifted.
  4. Cement and bulk steels will respond first and manufacturers well established in Asia and Africa seem particularly interesting. I like cement in India for the second half of 2014.
  5. Rare earths will remain in short supply and economic recovery will give prices which justify development of new mines and new resources. Investing in China has its own risk profile though. Japanese rare earth development companies could be of interest.
  6. Big Pharma’s evergreen and predatory patenting will come under further attack not only from India and China but also from Indonesia and Africa. The whole IPR model is flawed which makes for uncertainty. I shall avoid new investment but hold what I have.
  7. Social media monopoly positions will be weakened and new media will grow. I haven’t the faintest idea of how to pick any winners from the newcomers here. There has to be a backlash against intrusive advertising and I think this will cap revenue growth.
  8. There is a battle brewing between tablets and mobile devices. A single device which is as small as a mobile and which can expand to the size of a large tablet (perhaps even as large as a desk-top through glasses) would be a winner.
  9. Large retailers are due for a boom in the second half of 2014 and especially those with positions in the developing world.
  10. There are going to be new winners from Africa and Brazil but I don’t know how to pick them and therefore must wait and see.
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Signs that the Japanese recovery is beginning

July 4, 2011

Having a very strong belief in the resilience of Japan and the Japanese in the face of natural disasters, I have – paradoxically – been anticipating that the Great 2011 earthquake and tsunami will actually lead to a wave of infrastructure spending which can actually lead to a new spurt of economic growth. If political changes are also forthcoming this could be a wave of sustainable growth. 

Now 3 months after the quake and tsunami the first signs are visible that the recovery is beginning. There is a long way yet to go but I remain convinced that over the next 2 or 3 years we will see Japan re-emerging as a significant motor driving the world economy.

Bloomberg:

 

Japan’s industrial production rose at the fastest pace in more than 50 years, led by carmakers as they restored operations at plants after a record earthquake and tsunami on March 11.

Factory output increased 5.7 percent in May from April, the biggest gain since 1953, the Trade Ministry said in Tokyo today. The median estimate of 30 economists surveyed by Bloomberg News was for a 5.5 percent gain.

Output in the transportation industry advanced 36 percent from the previous month as automakers including Toyota Motor Corp. and Nissan Motor Co. restarted production lines. Manufacturers said they plan to increase output 5.3 percent this month and 0.5 percent in July, according to a survey of companies included in today’s report.

“The report shows that the auto industry is a strong driving force” in boosting production, said Hiroaki Muto, a senior economist at Sumitomo Mitsui Asset Management Co. in Tokyo. “The post-quake shock is running its course and production is undergoing a V-shaped recovery.”

The output report follows data this week showing that retail sales rose 2.4 percent in May from April, in a sign that consumer demand is rebounding.

Business World:

 

THE AUTOMOBILE INDUSTRY foresees a more stable supply situation at the very least following reports that Japanese parts production has picked up following March’s deadly earthquake and tsunami. Timing of a return to full output, however, remains uncertain given power shortages caused by the shutdown of the Fukushima nuclear plant, industry officials said.

Japan’s Ministry of Economy, Trade and Industry last week said industrial production rose by 5.7% month-on-month in May from 1.6% in April, with transport equipment among the sectors leading growth. Inventory was said to have similarly increased by 5.1% in May from previous month on improved production of electronics parts and devices, among others.

 

 

 


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