News of the death of I.M.Pei the inspirational architect at the age of 102 late last night. At this time of US Sino stresses it is worth looking at the simply staggering array of work produced by Pei the son of a bank manager born in Canton(Guangzhou) China and who arrived in the USA where he was educated at Harvard and MIT before building his iconic career. A true collaboration.
As highlighted last month the 2018 Italian debt position is 132% of GDP which is due to rise to 133% this year and 135% next. This is in contravention of EU rules that insist that such a deficit must be reduced but Italy is going in the opposite direction. 10 year Italian Government Bonds now yield 2.75% versus that of Germany’s which yield….Minus 0.7%. Deputy PM Salvini has indicated that Italy is ready to break those rules which calls into question the EU financial rules structure and hence the value of EUR. Markets have sold EUR while they watch the Italian government and the EU closely as to how they deal with this.
Saudi Arabia and the Oil Price
In the past 8 years the oil price has halved to $60 and this has resulted in Saudi Arabia borrowing $10billion in 2016 to meet their budget gap and reducing supply to even maintain the oil price even at this level. Last week we wrote that there is the prospect of a $15 oil price due to huge advances in the production of shale oil combined with a reduction in demand. Growth in the Kingdom is still at 2% but contrast that with the healthy 9% that the aspirational and growing and young population had become accustomed to. A new (huge) revenue source is required and quickly. The size of the Saudi economy makes the rest of the Gulf economies a relative side show so expect that region to feature heavily in the news in the next five years-and not in a good way.
Monet and Les Meules-Giant Haystacks
In 1986 it would have taken a brave heart to have written a cheque for $2.53 million for this painting. In 8 minutes and with a reserve price of $55 million, that savvy investment from the heart paid off with someone this week paying $110 million for this depiction of a stack of harvested wheat. In the 33 years that the previous owner of the painting enjoyed the painting-assuming it was not stored in a vault-as a US resident it might have been a matter of supreme indifference to them that at one time that $110 million was worth GBP 92 million and at another GBP 52 million. Quite a swing. For the rest of us 25 quid at myartprints.co.uk will buy you a nice poster of a similar looking Monet haystack!
Discussion and Analysis by Humphrey Percy, Chairman and Founder
Milan, Italy The City of Milan has a late night noise problem and so it has acted unilaterally to resolve it-Italian style. A ban on the sale of take away food including ice cream and pizza after midnight is being imposed to protect the “peace and health of residents.” Here in the UK late night […]
Coal tinted spectacles If you had to boil down the global economy into one category from the options of bad/fair/good, what would you choose? We all experience the economy vastly differently down to an infinite number of variables. But by and large the current phase we are in, characterised by strong global growth rates, record […]
British Pound Reports that the UK may cut its interest rates before the USA cut their interest rates were the final straw this past week for Sterling. A slew of less than helpful inflation, employment and finally retail sales saw GBP weaker , but then the suggestion that with the background of that less than […]