Tag Archives: David Cameron

China added to Important Index, Welcome Aboard!

Last week it was announced a group of large capitalization Chinese company stocks were allowed to be added to a very important global index, the MSCI Emerging Market index. This is great news for China and super news for those following our David Cameron talks from earlier this year.

China added to MSCI Emerging Market IndexChina hainan-105596__340

The fourth time really is a charm, as MSCI (Morgan Stanley Capital International) – most prominent and well known International Index provider – allowed a group of over 200 stocks to EVENTUALLY be added to their MSCI Emerging Market Index. The total inclusion will take several years but is a huge positive for China’s acceptance as a valid economic capital market.

Certainly China has a different social system than the USA, however, if David Cameron is only half correct in his thoughts, embracing rather than shunning China will have positive effects for decades to come.  The addition of China stocks into the MSCI Index may be the first step of many future positive ones to come.

We began a detailed review in our latest Newsletter on International and Emerging Markets but it was shoved tot he floor by our Residential Real Estate Price Movement article.  Everything happens for a reason. This recent announcement is a great addition to the facts and research we were including, look for more abbreviated information to come soon here with the full article(s) to follow in our Next Newsletter!

Have a Great “Mutually Prosperous” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

Everybody is Happy! Q 1 Cover Letter

Everybody is Happy!

From Bloomberg Consumer Sentiment to Gallup Polls to the Conference Board and to our University Of Michigan Survey of Consumers (Multiple Polls reviewed in detail in our most recent Newsletter-coming to you soon) all are pointing higher, with some even pointing to all time highs.

A more pro-growth tone seems to have put wind in the sails of those polled as well as capital market participants. Heck, the most recent quarter even garnered an interest rate increase of a small .25% in the shorter term Federal Funds rate. Looking back just over a quarter and including December of 2016, there are now two interest rate increases under the FOMC’s (Federal Open Market Committee’s) belt. The first rate increase in this economic cycle, post 07-09 Great Recession started in December of 2015. According to many, created the “record breaking” rocky start a year ago. Fast forwarding to today, market participants and the economy for that matter, seem to welcome a normalization of short term rate increases.

Speaking of rate increases, under normal circumstances all other items being held equal, which then never are, interest rate increases are a muzzle on the economy and in many cases are the cause of a larger slowdown or recession. The problem with this comparison is rarely have short term rates been zero, which they were held at for over five years in this economic cycle. It is possible that an increase of rates from such a low level to a more normal level may actually be energizing rather than resistance as past comparisons may show.

Is there a downside?

Capital markets look forward, usually 6-12 months. All this positive sentiment has led to stretched valuations from a historical point. The current Price/Earnings ratio, again shown in our latest newsletter, finds itself at 26, with a long term average of 15. Just as economic cycles do not die of old age, capital markets do not go down just because their valuations may be stretched. Higher valuations can lead to less room for errors, not a time to let our guards down and also not a time to be swinging for the fences, however valuations can return to normal simply with all this positive sentiment translating into higher world capital market earnings. Said another way, “Growing into the current Valuation.” Time will tell, and we will be watching closely.

Spring seems to finally have sprung, enjoy !

Sincerely,

John A. Kvale CFA, CFP

Enclosure (Q 1 Report)

Q2 2017 Newsletter Podcast and Audio Review By John Kvale

Here are a few of the topics discussed in our new Podcast, Audio Video review.

  • David Cameron Speaks at length
  • University of Michigan Sentiment Indicators
  • Updated Price Earnings Multiple
  • Three Travel Tips to save you aggravation and time

Q2 2017 Newsletter Podcast and Video Review

 

Have a Great Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

 

Repatriation/Tax Holiday of Foreign funds? Yes or No

In our continued crossover theme from our Out West Conference, this item was discovered while reviewing the tons of notes taken and prepping for more detailed articles in the coming Newsletter. Nice find!

As a reminder, a crossover occurs, in our minds, when several experts unknowingly say, predict, or comment on the same event or action. We like the chances of such an event when multiple parties agree, and in this case, we even chime in too.

Repatriation of Foreign money held hostage by US companies

Call it a tax holiday, repatriation or whatever term you may like, our experts agreed totally that allowing US companies to bring money back into the US would be terrific idea. Currently, companies have been strangled by a double tax hit if they bring “Already Taxed once” foreign earnings back into the US.20170202_165920762_ios

David Cameron, the famed former Prime Minister/President of Britain “It’s senseless to hold hostage US company money overseas!” He suggested a low tax of 6-8% to allow funds to be brought back into the US and said it would be a nice tail wind.

Derek Burleton, expert Canadian economist “US Corporate tax rates are a big mess and need to be fixed. Allowing funds back into the US from multinational firms is a great idea and would help the economy!”

We could not agree more.

  1. There will be uses of funds that not all agree are good.
  2. The spirit of free trade and borders is being hampered in our opinion by double taxing foreign earnings re-entry.
  3. The World is a MUCH smaller place.
  4. Free flow of capital will eventually find it’s best use, artificially hampering this can cause inefficiencies.

Have a great “Tax Repatriation” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
http://www.jkfinancialinc.com
http://www.street-cents.com

Will the European Union/Euro Survive ?

The neat thing about listening and visiting with so many “Experts” last week is when several crossovers occur. By crossover, we mean different experts unknowingly saying the same thing.

European Union Survival?

The Euro, a combination of 28 different countries (founded in 1999) all linked to one currency with a common goal of trade and a common currency to ease flow of funds,  had a shot fired across the bow of its boat in 2016 with the British vote – Brexit – vote to leave, costing David Cameron his job.

David Cameron (the newly much higher respected) former Prime Minister/President of Britain, who lost his job over the locals vote to leave, said there is only one thing that would cause the Euro to split.

Oddly, a terrific crossover by Canadian Economist, Derek Burleton (more fantastic info to come soon) echoed the same EXACT kryptonite for the European Union.

Marine Le Pen elected as France leader would mean possible end to European Unionle_pen_marine-9586

We do not have a say, we are not familiar with Mrs. Le Pen, we are only announcing what two VERY distinguished experts said exactly the same un-knowingly at different moments at our event.

Mark the calendars as the election is April 23, 2017 !

Of course a split up of the European Union would have consequences for the global economy. We have interesting thoughts on these possible “consequences” should this occur….closer to the vote !

For the record, both Cameron and Burleton gave a very low probability of Mrs. Le Pen being elected.

Thanks for the forecast !

Have a GREAT “Forecast” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

 

 

It only took 32 Minutes for “The Brain” to make a splash at the conference …. Meeting David Cameron ….

The lights were dimmed for the audience….

3000+ people to start the multiple day 14 hour a day conference….

Boom!   The lights are up, the attendees are revved up …. out walks the first speaker …

20170202_161515152_ios

 

Exactly 32 minutes later… up pops an interview – on full screen in front of all 3000 -with none other than …

Donald “The Brain”…..

20170202_163108888_ios

Gotta be kidding?

Nope… a replay from the meeting mentioned in this post earlier before the event…

First time an event has been crashed from across the county… Well Done Donald!

Meeting David Cameron

Later on in the  morning, David Cameron the former Prime Minister/President of Britian spoke …. Possibly the best talk ever … tons of notes to share. Even an in person meeting and quick chat…..

Today is a Friday, not surprisingly, time is short ….not to worry… LOT’S to talk about shortly…. Enjoy your weeekend !

Hope you enjoyed the update from a revved up body in the West !

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
http://www.jkfinancialinc.com
http://www.street-cents.com

All Eyes on an International Vote

Capital moves quickly in today’s world. Trade with countries and companies around the world is efficient and prompt. With such movement a co-dependence can occur. If one country catches a cold it can effect others.

First British Vote since 1975 – To Stay or leave the European Union

David Cameron, current British Prime Minister promised a vote for the British people on the possibility of leaving the European Union. Here is a terrific BBC summary of the entire event and great background. Cameron desires staying in the EU.

Given the afore mentioned co-dependence, capital market fluctuations will likely occur as the polls drift back and forth on the vote. Currently the vote is seen as being VERY CLOSE!

We have no position either way, however as countries become larger and more independent, it does not surprise us on a desire for such vote.

Buckle up as the vote is Thursday June 23rd, and may make for interesting headlines along with violent moves by trigger happy traders who may be standing in for their elders who are in the Hamptons !

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com