Comments of the Day
29 December 2020
Holiday Hours
Comment of the Day and the Subscriber’s video will next be updated on December 29th and I’d like to take this opportunity to thank all our subscribers for their patronage and support over the decades.
Big Picture Long-Term video December 23rd 2020
A link to this week’s Big Picture Long-Term video is posted in the Subscriber’s Area.
Brexit Negotiators Reach Outline of Historic Trade Accord
This article by Ian Wishart, Alberto Nardelli and Kitty Donaldson for Bloomberg may be of interest to subscribers. Here is a section:
U.K. and European Union negotiators have reached the outline of a post-Brexit trade agreement, and are now working to finalize the wording of the deal after almost ten months of often fraught deliberations.
The accord still needs to be approved by British Prime Minister Boris Johnson and the EU, according to officials with knowledge of the matter. That means the deal could still fall apart, and any announcement could be some hours away, they said.
The pound soared, advancing by as much as 1.6% to $1.3571, for its biggest intraday gain in more than a week. The yield on 10-year U.K. government bonds was poised for the biggest gain since March.
Johnson and European Commission President Ursula von der Leyen intervened personally in recent days, holding several phone conversations in a last-ditch bid to reach an agreement before the U.K. leaves the single market at the end of the month.
The headline of a “deal” and the signal that sends about the willingness of politicians to avoid economic distress is positive for the stock market and the Pound. Of course, we do not know exactly what the deal will contain. I remain of the view that an agreement always looked likely, but that its scale is likely to be rather limited. There will still be years of wheeling and dealing over enforcement and relative advantage. Delivering Brexit was a major election promise, its success will be measured by how each individual household fares after the fact. In other words, now the hard work begins.
The World’s First Hydrogen Hubs Are In The Making
This article by Alan Mammoser for Bloomberg may be of interest to subscribers. Here is a section:
Regional plans foresee the local production of hydrogen, both blue and green. They find places to store captured carbon below the ground and seafloor. And they see ample opportunity to power electrolyzers with winds from the North Sea and other nearby renewable sources.
Yet the buildup of major industrial clusters requiring growing amounts of clean hydrogen, through the 2020s and ‘30s, may open opportunities to develop new more far-flung sources of it. The development of hydrogen hubs suggests their linkage with the other pole of regional planning for clean hydrogen, namely major global supply areas.
IRENA sees industrial users can drive the development of dedicated “green hydrogen corridors” that connect regions generating low-cost renewable energy with demand centers. The IEA sees the need to get international shipping routes for the hydrogen trade going. These corridors (‘spokes’) will inevitably appear where the varying cost of hydrogen production among countries and regions favors resource-rich areas.
Europe and Japan, having relatively high costs and strong policy support for hydrogen, are likely importers. Big exporters would be Australia, Chile, the Southern US, the Middle East and North Africa, and other regions. To take advantage of an emerging global clean hydrogen market they will have to overcome an enormous challenge in the form of transportation costs.
From the perspective of politicians the debate about global warming is over and they are moving ahead with policy. The framework for pioneering a carbon free world is rapidly evolving. Quite whether it eventually has a marked effect on emissions is an entirely different topic, but both capital and legislation are being committed globally on the assumption it will.
Email of the day on IPO outperformance
Good evening Eoin I remember that you highlighted the IPO ETF USA – great performance! would you think that the IPO activity in the USA will continue into 2021 – I think about an initial first tranche investment into this ETF.
2020 has been the year of the blank cheque company or SPAC (special purpose acquisition company. The wall of cash thrown at global markets was a tsunami that raised all boats. That afforded entrepreneurs the opportunity to offload illiquid positions in private companies at record valuations. The same trend allowed Tesla to raise more capital in 2020 than in all other years combined even as its stock zoomed higher. It also allowed Apple’s stock to double to a market cap in excess of $2 trillion.
Weekend Reading and Viewing December 23rd 2020
How to Speak During Coronavirus reminiscent of Ronnie Barker mispronouncing worms and reading the news or Victor Borg’s punctuation sketch.
Eoin’s personal portfolio: stock market trading position opened December 18th
One of the most commonly asked questions by subscribers is how to find details of my open traders. In an effort to make it easier I will simply repost the latest summary daily until there is a change.
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