Economics Do Matter For Investing
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- Опубликовано: 6 июн 2024
- When do economics and other macro issues matter for investing. We live in a world of manipulated interest rates, increasing debt levels, perhaps higher inflation and unfortunately slower GDP growth than expected. This will all have an impact on long-term investing trends.
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0:00 Economics & Returns
3:21 Economic Outlook
12:18 Investing Ahead
Interest Rates & Geopolitics used to be "economics". Now its a part of fundamental analysis. Thanks the video Sven.
Buffet: "Name me one economist that is rich."
there arent any?
Ray Dalio who is economist and Billionaire
There aren't many but, undermining there contribution is ill and foolish, I dare you start business or invest in a company without help of economics, Banking and accounting and Law, oops 😬 impossible
@@venkatgoud8394 Economics is the study of choice with limited resources. It has nothing to do with evaluating businesses and valuation or timing the markets.
There are no doubt thousands of them at least. The problem is that "economist" can mean someone who has done a couple of undergraduate courses.
@@venkatgoud8394 He is a hedgefund manager and has made almost all his wealth off AUM fees. Not being an "economist"
I'm not entirely convinced that your statement about Italian tourists is completely accurate. Prices in Croatia have been increasing, and the country is not as affordable as it once was, especially during the tourist season. Nowadays, you can probably find comparable prices for similar services in Italy.
vacation in Italy is more affordable than in Croatia. I did both, Italy, more than once. Besides that, Italy is very tourist friendly with no special prices for tourists. Croatians became greedy, trying to squeeze whatever they can from tourists. The land is beautiful, but this approach toward visitors will damage the demand for Croatian holidays. This typical Balkan hospitality is almost not seen. Italy is the opposite. You don't feel ripped off. You don't feel cheated, prices can be negotiated in a friendly way. You feel welcomed as a tourist, and you feel respected. I spent two weeks in Italy last year and 3 years ago and visited Croatia 2 years ago.
Sorry with Sven, but italians dont come anymore in Croazia, cause the price there were skyrocketing. Like all things, when things are cheap, many will come, but increase demand and so price. Now italians goes to Albania, but things are changing there like in Croazia once. Its not italian money, its how much things cost with time :)
Inflation removes debts of govts and increases nominal returns of investors
Peter Lynch:
I’ve always said if you spend 13 minutes a year on economics, you’ve wasted 10 minutes."
Sven, you wasted 10 minutes here😂
:-))))))
Fun fact: the vid last exactly the 13 min Peter Lynch has stated 😂
Personally, I don’t see much correlation between GDP growth and the business / stock market.
Look at the US. Low GDP exceptional stock market for 10+ years…
It boils down mainly to interest rate (expectations).
The rest is a stable, rule based market environment where businesses can operate…
Economics is a lot more than GDP, its just 1 indicator
The french index you are using is without dividends... It changes everything.
le s&p500 aussi😢
What is the average dividends for French index?
Islways invested with the mindset to buy shares in companies for 25years and paid little attention to economics, and I got very wealthy doing that, however i reduced my holdings from 2007 to 2009 and from early 2020 to 2022….. that helped too, and I avoided weak economies… guess Sven is right
Indeed it does, without a doubt. The markets are the economy. The businesses are the economy. All is interconnected. One must know at least the basics of economics and the state of the current economy to see wether one should invest more or less, or when, or in what. This I learned the hard way, like everything is learned better. Also, Europe is among the worst continents currently because of corruption, collectivism, statism, interventionism, taxes... and in justone word, SOCIALISM. And it's just the politicians. It's the people of let them fool them and that keep voting them despite EVERYTHING. So... If we keep going by this path... Yeah, doesn't look good at all. Thanks!
That was a heavy one but important. Thanks.
Great video! I really do have a quick question. For someone with less than $10,000 to invest, How would you recommend we enter the market? I am looking study some traders and copy their strategy rather than investing myself and losing money emotionally. Whats your take on this approach?
Focus on long term investments in property, stocks, and bonds. Avoid copying, daytrading and 'chart astrology'. Diversify across different geographies, industries, and value chain stages - to reduce your risk. You can do this with ETFs, or by selecting different stocks yourself. This is the best way to invest for more than 90% of people
I tried copy trading, just when I started investing last Christmas. Had a poor experience, the guy I copied made many small trades, slowly loosing money. What good came out of it was that it gave me an insight into how the market really works. Make sure you do your homework!
It's usually best to ignore the trend whether bullish or bearish and stick to a proper trading plan maybe from the help of a professional. I recently just started investing again so I am still in touch with the consultant that provides entry and exit points on the securities I focus on. She does all the technical analysis legwork while I go about my other businesses. You can use something else if you are the DIY type of guy, investing has no one way to do it
It is essential for you to have a mentor to keep you accountable
1. Limit your spending/cut off retail therapy
2.Put the extra cash towards investing in high yielding or steady investment.
How can I participate in this? I sincerely aspire to establish a secure financial future and am eager to participate. Who is the driving force behind your success?
I try and dip my toes into some macro a bit! I agree alot with you, GDP growth is important for sure, and one large influence affecting GDP growth is actually the government, and if they introduce austerity measures. Which Europe has been more in favor, stifling companies by limiting their growth and so-called monopolies. You need a government willing to let credit grow (borrowing and lending). Any countries have tailwinds, Japan?
I like to focus on macro negative factors to better connect with the micro level and avoid predictions or abstractions. For example negatives for business operations in Europe could be social democratic ideological undercurrent (socialism), labor (union) market protectionism, equal welfare ideology, dwindling population, skilled labor shortage, bureaucracy, poor productivity etc. And in some countries in Africa you may have no rule of law, poor or no infrastructure, political instability, rampant corruption etc. As the negatives are not abstracted away they can be tangible part of the business analysis at micro level.
Depends on the business, all are impacted differently
Very Interesting view. Thank You. The Advice at the end was excellent
for that is the purpose of war Sven when you break something you have to build it again. sad but true.
Hi Sven what about Rio Tinto stock now? Is it a good moment to buy it? Thanks for all the videos
Problem is that the world changes so when looking in the moment it is easy to be pessimistic. I see an opportunity for companies to increase their margins with AI. Possibility is not zero for a white collar slaughter, AI has the promise to ten fold the productivity of one employee. If one is happy to not loose and ok to not be a winner the best bet is indexing for most. It is easy to dig one self into a hole, I think one could have argued that we have been in a bubble for ten years now.
And you used nominal figures for the GDPs of European countries. If you deflate those numbers by the CPI, they are MUCH worse.
The same situation is happening in Brazil. Stagnant economy for 10 yrs. Steadily increasing taxes to cover government deficits. Real GDP surpassing potential GDP (and the inflationary pressure that comes from it). And governmental debt steadily increasing.
Really excellent analysis!
love the video! great job
As Einstein once said “the market is not the economy, and the economy is not the market”. Let that sink in.
Most of the S&P 500 sales are abroad. Does it matter the USA debt?
🗽 Investing for the next 10 years in stocks probably is with a strong head wind... value investing and some diversification gets even more important!
.
Please update your data relating to Italy.. At the moment Italy is one of the best economics in Europe
Doom and gloom in the stock market may happen (unfortunately Sven is on point), but we should get discouraged. I think living a good life is possible even if your country economy doesn't grow as much (especially if basic needs are met already).
Lyon is pretty bad right now...lots of tents 😢
Sven why do you not like ray dalio?
Checkout The Fund by Rob Copeland
buffet says that its already too difficult too find good value that its useless to do global macro.
i disagree and we saw it during hiking rates 2022-2023.
is there an exception with NORWAY for europe…oil fund wealth, new energy hub for europe…europe is dead FOR SURE, but whats about norway stocks… cause i found interesting things there
in Euro terms the GDP of France/Italy/Spain increased, and that is the better measure than USD, because USD/EUR exchange rate just went down (as it rose before), that is the reason.
Best would be PPP terms - purchase power parity.
No: although France/Italy/Spain didn´t do well, the GDP didn´t shrink.
and by the way: the DAX performed terrible if you look at the course index, it is only up because it is a performance index, thus including ALL DIVIDENDS EVER PAID (since 1987) ... that is the only major index that is like this, as far as I know ...
Hmmmmm. Predicting the economics of countries seems pretty difficult. The US outperformed expectations and China underperformed relative to what was expected a few years ago. You can say its all about money printing, but technology is driving productivity gains in ways that were unexpected. Ai is just starting to reinvent the economy and we don’t know where it will go. I don’t value economic predictions - people are consistently burned trying to predict economics. The US is still the best economy in the world for generating new innovation, and having a rich startup/vc ecosystem.
Croatia simply became too expensive for a vacation compared to years ago.. Italians picked other places (Albania..)
not really, all places are more expensive, it is just that Italian money didn't follow...
Can you please analyze the German meal kit company HelloFresh? They are almost at all time lows.
Here in the UK they are doing crazy discount offers everywhere you look to try to get people signed up. Highly competitive space. Most people just sign up for the initial box at a heavily discounted price and then cancel I think
Yes, seems to be the same everywhere. But they are the global market leader with 75% market share in US/Europe. If they stop wasting money on unprofitable customers and focus on cash flow this could be a bargain. If they do 7B revenue with 3% CF margin = 210M per anum. Should be worh more than 1.1B? Problems - Debt?
The US is exporting their inflation. Investing in the US might be alright as long as everyone around the world trades with the greenback 🤔
Your channel is a must for all investors.
agree so much!
🙂
Sven when you will cover India? From a fundamental prospective it might overcome soon both china and united states in terms of GDP and population growth
😊
It’s eeven worse for France and others because they’ve let in millions of migrants that should’ve moved the gdp way higher. Although migrants adding to gdp doesn’t matter if they use more resources which they do than what they add to the gdp.
You don't like Ray Dalio on a personal level? Why?
Could be that his fees are arguably predatory, always preaching the crisis is coming while milking 1-2% fees
Dalio comes across megalomaniac, self promoter, to me.
Why did you pronounce the Philippines like that😂
$META is now at $505.
I sold it around $200 after listening to Sven's video. 😂😂😭😭
No one made you sell it
@@laykay7739you are clearly missing his point, sven isnt as good as an investor as he makes himself look.
@@laykay7739 very stupid comment. If these videos do not influence you, you have a big resistance to learn.
Sven tends to sell to early. The same with amazon. 120 he sold. Now its at 165.
He is a great Investor but he still needs to understand the Economy of "things that are going up".
If people see an uptrend they invest, bec it goes up. If people see red they sell or dont want it. Pretty simple. Its just the way it is.
Sometimes it is better not to listen Sven. He's mainly smart, but market isn't and that is what it counts.
Albania is cheaper for holidays
Not anymore rally
You do not show alternatives like India in terms of TFP or low internal Debt!😂
American markets are like addicted people. It's been leaving on stimulus. By the time you cut, the craving comes. In election year, I believe it won't happen this year, but it will happen
Italy joined euro zone at 1999 .. that is killing them 🤷🏻♂️🤷🏻♂️🤷🏻♂️, but chill DE is happy 😏😏😏
Thank you for keeping it real with us. We're all getting hit over the head with these prices, the good thing is being in a position to pay these prices. I feel really bad for those who are not in the position to pay for their basic needs. God bless Donald Onida imagine inviting $2,000 and getting $10,760 in 5days
Which coin do you buy? I need a recommendation please
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Investing in cryptocurrency is one of the lucrative investments but many are still ignorant of it due to lack of experience.
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This is the forth time am coming across Onida can anyone be kind enough to share any means of reaching out to her..?
The incompetence and corruption that runs through this administration are getting more ridiculous. I feel for people with disabilities not getting the help they deserve. Thanks for keeping us financially Educated! Regardless of how bad it gets on the economy, I still made over $65000 last month while trading
I would really love to know how much work you did put in to get to this stage.
Susan Moore's strategy has been instrumental in helping me navigate the past few months. Without it, I don't think I would have made it through
Scam alert ⚠️
I hate the European market, Germany and France are its current core countries. Its gigantic, so many company's, a lot of strong brands. Still after England left the EU. But if I look at EU, I don't know what it does very good... Its all over te place, all at once, nonstop. EU has it so difficult with every individual country focusing on their most important industry. Just last year they announced that they will invest (43 billion) in competitiveness and resilience in semiconductor technologies and applications, and help achieve both the digital and green transition. European has so many small semiconductor companys. Europe is not leading in this sector and they will keep building more niche semiconductor company's. Smaller company's helps to decrease the price, but major players are in America and soon China (if Taiwan doesn't watch out). I just get tired only thinking about it, I have a very small portion in my portfolio, because the euro and their bonds are safe and is strong. I hate Europe.
what do you mean small semis companies? ASML, IMEC and NXP are quite large. Specially ASML which is a monopoly at this point, nobody will have chips now if its not because of the machines that ASML manufactures for chip-making.
@@luigigetsu TSMC, Broadcom, Intel, and Texas Instruments are much larger than ASML. ASML's political influence became of importance as of 2019. Otherwise, it would have slowly degraded into the 10€ as a stock. It is not a monopoly, as some may say. If you think otherwise, you may have been influenced by a RUclipsr from a couple of years ago. ASML is simply a dominant player among many others in the industry. Such as X-Fab/ ARM/ GlobalFoundries and so on. Additionally, you mentioned IMEC, which is a research company. It doesn't necessarily add value to someone's portfolio unless you are a researcher yourself. Lastly, you mentioned NXP, another semiconductor company in the Netherlands. If the Netherlands were to become the second-best to Silicon Valley, they should identify as such. The fact that you said 'quite large' says it all and adds to my earlier comment. The companies you named are doing fine and add value to the EU market, but how does every individual country in the EU add value to the European market as a whole? Finance, Energy or maby Tourism? Europeans isn't big enough to manufacture as US or China does. Possible its service sector is strong, but that allows to help other countries aswell and intelligence is easily shared. I don't see the EU as the strongest growing economy, more like an utilitarianistic economy and is now at its weakest because fear and protectionism in the world.
Europe is fucked. Maybe after losing in Ukraine and continuing economic deterioration they will be more humble.
Čekaj ti si iz Hrvatske?? Znači nikad ne bih rekao hahah uopće nemaš takav naglasak. Od kuda si točno?
Money moving into assets due to fear of printing/inflation? Even though the US gov is doing QT.