4 May 2019 FT — Articles to Read

4 May 2019


Question: According to MSN: Money, how much retirement savings will you need?


US jobless rate falls to 49-year low – Pg. 1

–          Non-farm payrolls rose 263,000, …soaring above Wall Street forecasts of a gain of 190,000.  Average hourly wages were up 3.2% year-on-year, unchanged from the previous month, when expectations were for a slight increase

–          The unemployment rate fell from 3.8% to 3.6% – the lowest since December 1969.  The drop resulted in part from the departure of nearly 500,000 people from the labour force

–          …S&P 500 and the Nasdaq Composite both setting new highs this week


Investors flock back to credit product blamed for inflaming 2008 global crisis – Pg. 1

–          The vehicle, known as “synthetic” CDOs, short for collateralized debt obligations, bundle together derivatives whose returns depend on the performance of bonds, loans and other debts.  They provide hedge funds and other investors with another way to bet on the creditworthiness of corporate America

–          In contrast to standard CDOs, which bundle the bonds and loans themselves, synthetic CDOs proved destabilizing during the crisis because they allowed multiple bets on the same subprime mortgages


Moore exit fails to end Fed independence fears – Pg. 3

–          For Mr Moore, these included his past criticisms of pay equality between men and women, and a Virginia court’s decision to hold him in contempt for failing to make spousal and child support payments


Powell struggles with messaging clarity – Pg. 3

–          The new message from the Federal Reserve chairman – that “transitory” drags may be slowing price growth, rather than more persistent problems – marked a rude awakening for investors who had hopes he would signal an “insurance” interest rate cut this summer because of low inflation

–          …inflation readings have been bafflingly weak, with the Fed’s favoured measure of core price growth decelerating to 1.6% in March, even as unemployment hovers at just 3.6%


Chinese family defends $6.5m ‘donation’ – Pg. 4

–          Her daughter, a sophomore, was expelled from Stanford in April after being admitted in 2017 (Prof Note: What about Loughlin’s daughters?  Are they still Trojans?)


Answer: 16X final salary (Prof Note: It is about passive income NOT net worth!)