Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 342

Media worth consuming - January 2020

A monthly look at dozens of local and global media articles that often do not receive mainstream coverage in Australia. 

Finance

The beige book survey finds that the US economy is doing fine. US rail traffic points to sub-par economic growth in 2020. On several measures, US stocks are as overvalued as they were in March 2000. Americans are using their homes as ATMs again.  

A former proprietary trader started a hedge that charges no management fee but takes one-third of S&P 500 outperformance. Hedge funds run by white men are being beaten by their peers, though the result could be just a size effect. Expect more asset allocators to buy stakes in fund managers. Managed fund fees are falling, but investors are switching to higher fee funds. Bridgewater’s flagship Pure Alpha fund delivered a 0.5% return in 2019, with the all-weather strategy up 16%.

Fitch upgraded Greece to BB; a 15 year bond issue could follow. The IMF is almost out of its self-created Greek mess. Lebanon’s citizens are rioting as they are limited to withdrawing $200 per week from their bank accounts. Tesla has the highest market capitalisation any US auto maker has ever reached but one company’s detailed analysis argues that Tesla is built on fraud.

American banks are regularly increasing credit card limits without being requested, with subprime borrowers more likely to be targeted. A decade after the financial crisis, American jumbo mortgages are still defaulting with a backlog of arrears waiting to be cleared. Investor protections are being stripped from CLOs. Bad arguments for why leveraged loans aren’t a problem. 32 dumb things people say about investment markets.

Politics and culture

Trump is sick of losing wars and paying the bills for other countries, but the military just doesn’t get it. Elizabeth Warren’s bankruptcy proposals would see some in the middle class relieved of responsibility for their poor decisions.

She was also confronted with the lack of fairness in her policy for cancelling student loans. Trump voters are slightly more likely than Democrat voters to spot fake news. A pro-Clinton Facebook executive credits Trump’s victory to his team’s far better online campaigning. American sanctions have wedged Iran.

A Chinese man has been jailed for six months for posting tweets that mocked President Xi. The Brazilian Culture Minister was sacked for making a speech remarkably like one given by Joseph Goebbels. Chile’s left-wing grievance culture is ruining a prosperous economy. The Austrian Conservative/Greens coalition government is finding ways to work out policy disagreements. German grandmas held a protest after a government owned TV station played a song with children calling them environmental pigs for eating meat and driving fossil fuel powered cars.

CNN is upset that a satirical news website is getting more clicks than it does, with this hilarious article a particularly sharp joke on the network. Rocky Gervais used the Golden Globes to mock the hypocrisy of Hollywood. An American bankruptcy judge has wiped out a $220,000 student loan debt in a case that could signal a turnaround from long standing precedents. A city in Washington state has demanded a widow pay $60,000 for approval to renovate her house. Letting homeless people live with “no rules” is a danger to themselves and others.

Economics and work

Inflation and growth are low due to excessive debt, not a glut of savings. The negative externalities of government deficit financing are like a factory polluting the water for downstream users. A skeptic’s guide to MMT. The basics of rent seeking and how it diminishes an economy. The short, illustrated version of Hayek’s “The Road to Serfdom”. If you like coffee remember that many steps of capitalism were required to bring it to you.

Governments would be much more effective in helping low income people if they focused on the cost of living rather than minimum wages. The reasons that welfare reduces work and the incentives to be independent. Henry Ford voluntarily improved conditions for his workers far more than unions did. The Roman Empire failed in part due to ongoing bailouts and the excessive welfare system. DoorDash pays its American delivery personnel an average of $1.45 per hour, but strangely seems to keep finding people willing to work for it.

Pittsburgh’s insurance-free doctor charges $35 per visit. The economics of gift cards. How bulk buying is sometimes more expensive. 5 economic myths that people believe despite overwhelming evidence.

Miscellaneous

How Western society increasingly doesn’t ask questions when they might get in the way of getting paid. Microsoft went to war against the IRS when the agency tried to stop its shady tax ploys. The 30 most evil tech companies. The software service Slack is reducing productivity, the exact opposite of its sales pitch. A Chinese bank manager took $40 million in bribes and kept it in cash in his apartment. How a Missouri farmer defrauded buyers out of $70 million selling fake organic grain.

2019 was the second hottest year on record, with the last decade the hottest ever, but there are still a few who argue that global warming doesn’t matter. Despite trying to make its grid greener, Germany is closing down nuclear power generation and relying more on coal. US electricity demand is falling, but a wave of wind and solar generation is coming online. A remote West Australian township is testing a 100% renewable, hydrogen/solar/wind power system. 7 personal factors that lead to wealth creation. 15 tasty facts about bacon.

 

Written by Jonathan Rochford of Narrow Road Capital. Comments and criticisms are welcome.

This article has been prepared for educational purposes and is not a substitute for professional and tailored financial advice. The accuracy of the material cannot be verified in all cases. Narrow Road Capital advises on and invests in a wide range of securities, including securities linked to the performance of various companies and financial institutions.

 

4 Comments
Con
February 01, 2020

The article on Germany/nuclear made it sound as if they were reverting to coal. Just read this article in LA Times which says they are closing all coal plants. Guess the road to fully renewables will heat up. https://www.latimes.com/world/europe/la-fg-germany-coal-power-20190126-story.html

Jonathan Rochford
January 31, 2020

Hi Pat - thanks for taking the time to comment. I'm the first to admit that I have biases, just like everyone else. The questions I consider in pulling the links together are (i) is it interesting and worth others reading, (ii) is it evidence based and (iii) is it something that people are unlikely to be reading elsewhere. Do feel free to send me your favourite articles for consideration next month. I do consume a lot of ABC media and almost nothing from The Australian.

On the climate denialist point I'd simply point you to this month's articles. The evidence is clear that the earth is getting hotter, but a handful of outliers believe that doesn't matter. If Germany wants to have a greener grid, surely nuclear is better than coal? My favourite article was the last one, which showed that there is viable pathway to 100% renewables, though it is still somewhat expensive. Given time, I think this will change and I'm particularly hopeful about possibilities of using excess solar/wind generation during the day to create hydrogen.

Pat Connelan
January 29, 2020

Needs a better balance. It's a neoliberal, libertarian, climate denialist reading list. If we wanted this, we'd buy The Australian.

Tim Johnston
January 30, 2020

Bacon has no political or ideological bias.

 

Leave a Comment:

banner

Most viewed in recent weeks

Simple maths says the AI investment boom ends badly

This AI cycle feels less like a revolution and more like a rerun. Just like fibre in 2000, shale in 2014, and cannabis in 2019, the technology or product is real but the capital cycle will be brutal. Investors beware.

Why we should follow Canada and cut migration

An explosion in low-skilled migration to Australia has depressed wages, killed productivity, and cut rental vacancy rates to near decades-lows. It’s time both sides of politics addressed the issue.

Are LICs licked?

LICs are continuing to struggle with large discounts and frustrated investors are wondering whether it’s worth holding onto them. This explains why the next 6-12 months will be make or break for many LICs.

Australian house price speculators: What were you thinking?

Australian housing’s 50-year boom was driven by falling rates and rising borrowing power — not rent or yield. With those drivers exhausted, future returns must reconcile with economic fundamentals. Are we ready?

Retirement income expectations hit new highs

Younger Australians think they’ll need $100k a year in retirement - nearly double what current retirees spend. Expectations are rising fast, but are they realistic or just another case of lifestyle inflation?

Welcome to Firstlinks Edition 627 with weekend update

This week, I got the news that my mother has dementia. It came shortly after my father received the same diagnosis. This is a meditation on getting old and my regrets in not getting my parents’ affairs in order sooner.

  • 4 September 2025

Latest Updates

Shares

Why the ASX may be more expensive than the US market

On every valuation metric, the US appears significantly more expensive than Australia. However, American companies are also much more profitable than ours, which means the ASX may be more overvalued than most think.

Economy

No one holds the government to account on spending

Government spending is out of control and there's little sign that Labor will curb it. We need enforceable rules on spending and an empowered budget office to ensure governments act responsibly with taxpayers money.

Retirement

Why a traditional retirement may be pushed back 25 years

The idea of stopping work during your sixties is a man-made concept from another age. In a world where many jobs are knowledge based and can be done from anywhere, it may no longer make much sense at all.

Shares

The quiet winners of AI competition

The tech giants are in a money-throwing contest to secure AI supremacy and may fall short of high investor expectations. The companies supplying this arms race could offer a more attractive way to play AI adoption.

Preparing for aged care

Whether for yourself or a family member, it’s never too early to start thinking about aged care. This looks at the best ways to plan ahead, as well as the changes coming to aged care from November 1 this year.

Infrastructure

Renewable energy investment: gloom or boom?

ESG investing has fallen out of favour with many investors, and Trump's anti-green policies haven't helped. Yet, renewables investment is still surging, which could prove a boon for infrastructure companies.

Investing

The enduring wisdom of John Bogle in five quotes

From buying the whole market to controlling emotions, John Bogle’s legendary advice reminds investors that patience, discipline, and low costs are the keys to investment success in any market environment.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.