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Market Scorecard
If Brexit wasn't messy enough already, last night the UK parliament rejected all eight non-binding guidance votes. Theresa May also said that she would step down as PM once a Brexit deal was signed, will that ever happen though? The Brexit sold to the people of the UK, an easy exit with all the EU upside and none of the downside, is like a unicorn. All the current options on the table are horses, donkeys and zebras with a horn strapped to their head. No wonder there is no consensus on what to do next, the current proposals are not what the people voted for. The only problem is that the people voted for something that doesn't exist in reality.
Over in the US, traders are not sure what to do with themselves at the moment. An inverting yield curve is a warning signal of a bumpy road ahead, but lower interest rates are good for stocks. What to do? To add to the dilemma, research from Citi Bank shows that on average stocks move higher when a yield curve inverts. This is historical data, where they are looking at the average moves. Each situation is unique. Currently the US and China are meeting to try resolve their trade dispute, which if resolved could be a boost to global growth.
Yesterday the JSE All-share closed up 0.92%, the S&P 500 closed down 0.46%, and the Nasdaq closed down 0.63%.
Our 10c Worth
Byron's Beats
Morgan Housel has a way with words. Some people just have the knack of making complex issues sound simple. Warren Buffett is another expert at that.
In this article titled Death, Taxes and a Few Other Things Morgan looks at how the lives of most humans have improved even though most of us don't realise it. That is because we are always comparing ourselves to those better off. The irony here is that the need to compare is what makes us constantly improve as a species.
I am not going to try and reword what has already been said so eloquently. Give it a read, it is not long.
Michael's Musings
Immigration is a touchy subject. People have varying views on the subject. The Pew Research Centre did a study on how different countries view immigrants, South Africa was one of the countries visited - Around the World, More Say Immigrants Are a Strength Than a Burden
The study asked questions like, do immigrants cause an increase in crime or terrorism? The research went further and broke down the people studied into the left, centre and right. In some instances, the views from people on the left were very different from the opinions of the people on the right.
In pure economic terms, immigrants are good for a country; even illegal immigrants. In some places like Japan, they have a major issue with an ageing population and desperately need an increase in immigration numbers. In years to come, Europe will probably be in a similar position.
Bright's Banter
Michael Jordaan's digital-only challenger bank, Bank Zero, is stealthily making distinguishable moves just after another digital bank called Tyme Bank had opened up its virtual doors for business. Bank Zero in a press release, announced that beta testing is well underway, just months after their banking licence was granted. The bank is on its way to launch to the public in the second half of the year.
The company wrote: "Bank Zero's innovation and efficiencies use South Africa's advanced payment infrastructure as its foundation." Which means Bank Zero will not only be a transactional bank but also a clearing and settlement bank fully integrated into the National Payments System. I hope they eventually become a SWIFT member and disrupt the expensive fees for sending and receiving money offshore.
Some of the cool features include new super safe check accounts with real-time checking and money control capabilities, the ability to detect irregular/rogue debit orders, and epic saving pots (this is me just hoping). Businesses are also part of the beta testing, meaning that it will also have a business banking leg integrated with cloud-based accounting software Xero.
Most people will be happy to hear that you won't have to change everything when your card gets replaced so no need to update your banking details on all your online memberships. For those like me, you'll be able to make QR payments via the app on platforms like Zapper and Snapscan, as well as mobile-based NFC payments.
This bank already sounds like N26, Monzo, and Metro Bank combined! I managed to wangle myself into their beta testing and the launch coming up in the second half of the year. I'm pretty excited to write about what I learn in the process. What I love about these challenger banks is that they're going to increase competition, push all the exorbitant banking fees to zero which is excellent for us the consumers and find other ways to be profitable!
For more on Bank Zero you can listen to the man here or more further reading here and here.
Linkfest, Lap it Up
I wonder what would happen with Brexit if it was up to a robot? A surprising number of people trust AI to make better policy decisions than politicians
Our DNA stores massive amounts of data. Scientists are now trying to harness that technology - Microsoft Has a Plan to Add DNA Data Storage to Its Cloud
Vestact Out and About
Signing off
The JSE All-share is lower this morning and the Rand is weaker due a surging Dollar. In nervous times, funds flow into the safe haven of the USD. This afternoon is the interest rate decision from the SARB, all signs point to a hold. Also this afternoon is a revised Q4 GDP number for the US, where the expectation is for a revision lower meaning that the US will miss the 3% growth rate being celebrated by politicians.
Sent to you by Team Vestact.