31 December 2018 FT — Articles to Read

31 December 2018


Question: According to MSN: Lifestyle, what are thirty one (31) Good habits you should start on New Year’s Day?


China to end the year as world’s worst performing stock market – Pg. 1

–          A trade dispute with the US and a crackdown on shadow banking made China the world’s worst-performing major stock market in 2018, shedding some $2.3tn in value

–          China’s benchmark CSI 300 index will finish the year close to 3,000, down more than 25% form where it started 2018…

–          The staggering drop outpaced other poor performers: Japan’s Nikkei 225 dropped 14%, the US S&P 500 was down 8% and the UK’s FTSE 100 fell 13%

–          Liquidity in the Chinese market tightened this year, following a regulatory crackdown aimed at combating a years-long build-up in leverage in the financial system.  Those reforms have focused largely on so-called shadow banking, which before the clampdown saw lenders channel a significant sum of money to fund managers which then invested it in Chinese stocks

–          China’s slowing economy is also worrying markets – it grew 6.5% in the third quarter, its slowest quarterly figure in almost a decade


Fed optimistic despite investor fears for global expansion – Pg. 3

–          World output growth for this year was projected at a healthy 3.7% by the IMF in October…

–          Five advanced economies – Japan, Germany, Italy, Sweden and Switzerland – all experienced contractions in the third quarter of this year…economies affected represent a hefty 15% of the world GDP, …

–          Leading indicators have turned downwards, with the OECD club of mostly rich nations this month noting “easing momentum” across Europe, Canada and now the US.  Growth could be set to slow simultaneously in the US, China, Europe and Japan next year compared with this year

–          …global trade has slowed sharply, down to 2.25% growth compared with a long-term average of 4.5%

–          The Fed has lifted rates nine times in three years and is set on a balance sheet reduction programme that will contract its asset holdings by hundreds of billions of dollars next year.  This will combine with a waning US fiscal stimulus in the second half of next year

–          ….US inflation is quiescent, despite unemployment hovering at half-century lows, meaning the Fed can afford to be patient with policy – and that is a message the central bank is likely to hammer home in the coming weeks

–          While Fed policymakers are projecting slower growth in 2019 than this year, their latest median projection is for 2.3% next year – stronger than the economy’s longer-term trend.  Unemployment could carry on falling, if they are right, to bottom out at just 3.5%, down from 3.7% now and the lowest in half a century


Making sense of divisive trends – Pg. 5

–          Conventional wisdom holds that internet speeds in rural areas are much slower than in towns and cities (Prof Note: Why can I get an internet connection on Nevis and NOT southern Maryland, USA?!  Why is internet, at this point, not considered a utility as is electricity with requirements to service everyone?!)


Central bankers refocus on Main Street – Pg. 7

–          Several regional Fed governors – including those in Boston, Dallas and Kansas City – are prioritizing another, less well known, function of the central bank: community development

–          While the Ed has a mandate to keep unemployment low and inflation stable, it is also empowered to bolster growth in local communities.  This includes everything from industrial policy initiatives in the rust belt, to helping immigrants in depressed areas start businesses, pushing educational reforms and encouraging efforts to bring broadband to rural areas

–          The past 10 years at the Fed have been all about bolstering markets.  In fact, you could argue that the past 40 years have been too, beginning with Alan Greenspan era of lower rates and supply-side thinking.  But, regardless of whether the Fed decides to halt rate increases in the next few months, it’s clear that the power of monetary policy to support the real economy has diminished.


Answer: (1) Plan your day (Prof Note: I actually do this the night before.  This way when I wake I have an idea of how the day will unfold and what will be (or won’t) accomplished); (2) Make lists (Prof Note: If you could see my desk it is covered with large-size index cards full of lists.); (3) Read more (Prof Note: There is so much knowledge and pleasure in reading.  Also, the luxury of time to actually spend enriching oneself.  I am re-reading high school required books as a baseline of societal experience to improve my own writing and relating to people.  How many times have classes heard me say, “I have the conch!”); (4) Save your coins; (5) Expand you vocabulary (Prof Note: See note on “Read More”); (6) Recycle; (7) Reuse those bags; (8) Commit to a cause (Prof Note: Be careful with Philanthropy and causes.  2018 was my year to be philanthropic and it turned out to be the year I truly learned about philanthropy.  I am finding that direct giving, e.g. scholarships and grants, is a superior method of giving.  Organizations want cash without strings but when one provides capital it is for the purpose of a believed and committed agenda.  If one gives capital for an event, e.g. highest score on a national examination, one feels good about that forever.  If one provides capital to a cause and the cause misuses the gift, one feels, at best, slighted and, at worst, fleeced.  The P(Gain) Foundation will focus mostly on directly giving to individual students for accomplishments.); (9) Clean up as you go (Prof Note: In the Caribbean, if you do not clean up immediately, i.e. kitchen, ants will be everywhere); (10) Incorporate exercise (Prof Note: I do feel better after exercising); (11) Eat Healthier (Prof Note: I wish I had read this prior to purchasing the two large bags of BBQ chips on sale); (12) Take a positive approach (Prof Note: In the classroom I work very hard at never using the word “wrong”.  Instead I use, “Not right” or “Not correct”); (13) Be nicer (Prof Note: Try talking to random people.  The experiences are often rewarding.  Everyone has a story.); (14) Offer compliments (Prof Note: I will be truthful, societal has become so divisive that pull back from providing compliments in the U.S. other than positive accolades for work product.  I do not comment on outfits or physical appearance (as the article suggests)); (15) Follow the news (Prof Note: If you are reading this…CHECK!); (16) Get outside (Prof Note: Feeling the sun on one’s face and breathing fresh air is a joy!); (17) Finish projects (Prof Note: When you plan your day, plan one tangible accomplishment for the day.  It can be laundry, just have something done at the conclusion of each day); (18) Take care (Prof Note: This is relating to personal appearance.  One does feel better groomed but also take care to not feel the need for 100.0% conforming!); (19) Build a spiritual focus; (20) Live your life (Prof Note: We only get so many sunsets in life.  Enjoy more of them! Also, determine what is really important in life and pursue important items.); (21) Do research, for fun; (22) Learn a skill; (23) Job training; (24) Nix the gossip (Prof Note: I have spent far too much of my life in litigation.  While I was successful, it taught me that until you know ALL the facts, you have opinions based on known information (“known” can be unsubstantiated).  Always think, “Do you want to be someone associated with positive comments or negative comments?”); (25) Clip coupons (Prof Note: Cannot stand coupons.  I wish retailers would make it easier and have one low price); (26) Encourage unity (Prof Note: Quality people are wealth!  Spend more time with quality people.  Yes, Mike C if you are reading this we will be spending more time trading options in 2019!); (27) Incorporate fun (Prof Note: Life is a cycle.  We are born children with passive income sources called “parents”.  We grow through childhood resenting constraints placed by parents for the passive income providing.  We then spend the next 40 years working our collective tails off to fiscally recreate what our “resented” parents provided only so we can revert back to childhood which is now called “retirement”.  I still ride my quads like a teenager only with the permission of a middle-aged male….have fun in 2019!); (28) Laugh more; (29) Be more mindful; (30) Listen closely (Prof Note: You learn most through listening and NOT talking!); (31) Revisit goals (Prof Note: I am going to make progress on the third book this year!  Goal is to have it in draft form and to a ghost writer/editor by year’s conclusion)