China’s power scares Hong Kong savers. The world economy will experience a tougher start to 2021 than expected. The US urges China to commit to Taiwan.
The global economy is facing a tougher start to 2021 than expected as coronavirus infections increase and it takes time to deploy vaccines.
While global growth will still pick up rapidly since last year’s recession at some point, yes it may take longer to ignite and not be as healthy as previously planned. A double-dip recession is now expected in Japan, the eurozone and the UK, as restrictions apply to curb the spread of the virus, while record cases in the US drag on spending and hiring retail. Only China has achieved a V-shaped recovery after containing the disease soon, but even there consumers are wary of partially closed Beijing.
The growing power of China is scaring away Hong Kong’s regular savers, and Bank of America estimates outflows could reach $ 36 billion this year as residents evaluate their options. A proliferation of discussions has emerged on social media offering advice on creating offshore accounts, transferring money to other assets, or opening accounts with U.S. banks, which is perceived as less flexible to the demands of the authorities. Chinese, after the introduction of globalization national security law imposed on the city last year. For some, the latest milestone came when banks, including British lender HSBC, froze the accounts of former lawmaker Ted Hui and family members after he went into exile in the UK with his family. Other signs that the pace of cash leaving the city is rising include rising withdrawals from the city’s pension fund and rising interest in UK property by Hong Kong.
Asian stocks seemed off start the week, as traders awaited a Federal Reserve political meeting and a series of benefit reports in the context of the worsening pandemic. The dollar remained stable after Friday’s gains. Equity futures signaled modest gains in Australia and Hong Kong and varied little in Japan. The S&P 500 index fell for the first time on Friday by four, in a cause for concern that a new strain of coronavirus is more deadly than previous variants. Treasury yields were withdrawn.
Australian Treasurer Josh Frydenberg said it was “inevitable” that Google and other big technicians would end up having pay to use multimedia content, in response to the Internet giant’s threat to disable the search engine in the country if it is forced to pay local publishers for news. Google said Friday that a bill, intended to compensate publishers for the value their stories generate for the company, is “unfeasible,” opposing the requirement paid by media companies to display snippets of articles in search results.
The US Department of State urged China to engage in dialogue with Taiwan’s democratically elected representatives and to stop putting military, diplomatic and economic pressure on the island. The U.S. statement came on Saturday when Taiwan said a fleet of 13 Chinese military aircraft, including eight H-6K bombers, had entered its air defense identification zone, in an apparent intensification of the raids. Beijing’s almost constant military around the Taiwan Strait.
What we have been reading
This is what has caught our attention for the last 24 hours:
And finally, this is what interests Tracy today
You are a financial professional who has sat on the sidelines while retailers with Robinhood accounts use activated options Meme actions to earn more than your annual bonus in a month? Then perhaps he suffers “the envy of Robinhood.” I think it’s a growing phenomenon. It’s true that I don’t have much evidence of this other than a few anecdotes, but it’s hard to imagine that finance professionals aren’t looking at the recent successes of retail with at least some degree of envy. A post (now deleted) by an anonymous finance professional on Reddit’s famous “wallstreetbets” forum was simply titled, “I Hate You All.” The poster said he had studied finance to get a job in the industry and was now working in a company where short-term trading of personal accounts was restricted, meaning he could not participate in large gains in stocks like Plug Power. Meanwhile, the fury of the rise of Gamestop faces all the bets on the wall against the short-selling firm Citron Research in the final battle of “flows before professionals.”
How professionals choose to focus on the growing influence of the Robinhood crowd in the markets will be an important issue in the future. These investors are creating short squeezes, forcing stocks to increase through options activity and contributing to the upward momentum of popular meme stocks that capture Reddit’s collective imagination (and are often pump to the platform). All of this is being transmitted to the markets, as Corey Hoffstein, co-founder and CEO of Newfound Research, told my Odd Lots co-host Joe Weisenthal in an interview last week: “If you have these frothy situations where individual security isn’t necessarily creating steady gains, but you see something like a Gamestop or a Plug that is jumping drastically in a one-month period, well, boost investors, if they’re not careful, will start to be able to pick up these names.hable to ride the wave of retail, if that is what is really influencing it, but you can also end up being the bag holders as the retailer comes out of these names and moves on to something else. “. Wall Street is likely to end up feeling enmity with Robinhood, along with envy, soon.
You can follow Tracy Alloway on Twitter at @tracyalloway.