📑 Research Notes for 2021-11-08
This week, we look at the planned Fed taper, China's stagflationary economic situation, Buffet's investment performance, and what type of stocks do well during an inflationary environment.
We conduct extensive investment research and share the most interesting content that we come across every week. Here is a curated list of this week’s top observations.
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The Fed Reveals Its Tapering Strategy.
(Bloomberg)
After months of intense speculation, the Federal Reserve has finally laid out its plan for tapering the huge monthly asset purchases made during the pandemic. Here’s what you need to know about the Fed strategy, and how markets may react going forward.
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China’s Economy is Showing Signs of Stagflation.
(CNBC)
There are signs of stagflation in China, as prices continue to rise while the latest manufacturing data show production slowing, economists say China’s factory activity contracted more than expected in October, shrinking for a second month, an official survey released on Sunday showed. The official manufacturing Purchasing Managers’ Index for October came in at 49.2, falling below the 50 level which separates expansion from contraction
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Berkshire Hathaway’s Net Earnings Fall 66% on Lower Investment Gains.
(Wall Street Journal)
Warren Buffett’s Berkshire Hathaway Inc. said net earnings fell after paper gains from the conglomerate’s vast portfolio of stock investments declined from a year earlier. Berkshire's third-quarter net earnings fell 66% to $10.34 billion, or $6,882 per Class A share equivalent, from $30.14 billion, or $18,994 a share, in the same period a year earlier. Investment gains totaled $3.88 billion in the most recent period; a year ago, Berkshire reported gains of $24.77 billion.
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The Great Inflation, Factors, and Stock Returns.
(O’Shaughnessy Asset Management)
Our analysis suggests that while investors are right to pay attention to inflation, comparisons with the 1970s may be overblown. Equities, as a whole, may not welcome high rates of inflation, but certain stock selection factors have shown more resilience than others in periods of rising prices.
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Curated by Joseph Lu, CFA®
Joseph has over a decade of experience as an investment professional, primarily in quantitative analysis and portfolio management roles. He is the founder and managing director of Conscious Capital Advisors and a CFA® Charterholder. The CFA charter is a globally respected, graduate-level investment credential by the CFA Institute, a global association of more than 90,000 investment professionals working in over 133 countries.
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The information presented in this newsletter is for educational purposes only and is not a solicitation or recommendation for any specific security, product, service, or investment strategy.
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