Investing and Global Finance News


Nigeria and Capital Markets

For the economy in Nigeria to grow and flourish, capital markets are “critical.”  According to Nigerian Stock Exchange CEO Oscar Onyema – in his recent address to the 5th Lagos and London Capital Markets in Partnership Conference – for growth to really happen, Nigeria needs a “solid and vibrant capital market ecosystem that will attract investment and unlock the potential that exists in the economy.”

Apparently though, Nigeria is already becoming an attractive option for international investors.  Being Africa’s “largest economy” according to Iheanyi Nwachukwu “has the potential for a larger capital market that offers better returns for any prospective investor now and in future.”  This sentiment was supported by Head of Primary Markets, Middle East, Africa and India, Gokul Mani who pointed out that:

“Nigeria still offers huge opportunities for investors. Africa and indeed Nigeria are very high focus regions for London Stock Exchange Group (LSEG),”

The NSE and LSE Dual Listing Conference – held earlier this month – was organized in an attempt to enhance and advance relations between the UK and Nigeria.  As the situation currently stands, Britain – according to Laure Beaufils, British Deputy High Commissioner, British High Commission – is 100% in favor of supporting “investment, finance, and inclusive growth in Nigeria. One out of every five companies listed on FTSE 100 Index has business presence in Nigeria.”



M&A News

The acquisition by Principal Financial Group of RobustWealth is happening.  With both corporations working together on the deal for nearly a year, the details are that in the deal, RobustWealth will “retain its open architecture philosophy and operate independently under a management committee within Principal [and] will continue to sell their platform to firms outside Principal as part of their growth strategy.”  According to CIO of Principal Financial Group Tim Dunbar, the deal will “accelerate [Principal’s] broader digital efforts.  We really think it’ll help advisors to get closer to their clients, provide customized solutions, and help the advisors to grow. We have to acknowledge people’s needs and wants: there is an unprecedented need for financial advice. And, in today’s fast-paced, always on, digital world, people have a strong desire for personalization, convenience and 24/7 access to their money.”

Viking Global Investors recently acquired a majority stake in Birchbox beauty startup. Investing approximately $15 million into the business, this will render the company’s other investors somewhat obsolete.  VC firms like Accel Partners and First Round Capital will likely walk away with nothing from the firm now valued at $500 million. Co-founder and CEO Katia Beauchamp will remain at the head of the company and there have been promises that there will not be job cuts connected to the deal.

Kohlberg Kravis Roberts (KKR) is purchasing BMC, a software company.  At the date of this publication, the price has yet to be revealed.

Hedge Fund Agents: The New Player

In this video, Professor John C Coffee, Adolf A. Berle Professor of Law, Columbia University, discusses his winning paper in the ECGI Law Series in 2017. It examines the “new world of hedge fund activism.” New agent –which aggregates the support of many institutional investors and brings pressure to bear on the board for issues that it believes will be value maximizing.” That’s basically good, Coffee says, but warns that “new agents always involve new agency costs.”

Trade War and Reacting Futures

Once Treasury Secretary Steven Mnuchin declared that the trade war was “on hold,” futures took a huge jump. Following discussions and negotiations, they reached a “very comprehensive framework agreement that needs to be implemented” with a large variety of components.
One of these has been Trump’s focus on trade deficit reduction through the significant increase of exports.

Finance Awards

Throughout the world, awards are presented for various accomplishments in finance and related industries.  Here we take a look at recent Enterprise Awards given in the UK; Alabama’s Elite Investment Awards and Malaysia’s Investment Awards. Later on in the year, we will be privy to Boring Money – in conjunction with – The Telegraph putting together the Consumer Investment Awards 2018.

The UK’s most esteemed recognition for business success – the Queen’s Award for Enterprise 2017 – this year went to LEW Techniques Ltd. in recognition for its growth in international trade.  According to the company’s technical director, Andrew Walker:

“Since we were honored in 2016, we have continued to grow significantly, doubling our turnover mainly by increasing our overseas sales, which have risen more than 250 percent. Over the last few years, we have collaborated in projects with customers developing loudspeakers, critical oxygen sensors, and safe explosive detonators — all areas new to us and each requiring significant new process development. Often these types of projects take years to deliver a functional, marketable product, and some may fall by the wayside, but we always learn along the way, take the knowledge learned, and add it to our portfolio of techniques.”   said Andrew Walker, technical director at LEW Techniques.  LEW Techniques specializes in the manufacture of custom miniature mechanical ceramic and metal components.”

In Alabama, Wayne Farms and Mercedes-Benz were chosen for the elite investment awards assembled by Trade and Industry Development.  According to Publisher Scott D. Swoger, the

“These major investments provide a clear snapshot of where and in which industries growth is occurring today. Each of the investments to be made by Trade & Industry Development’s 13th Annual CiCi Awards recipients will be transformational for the communities in which the projects will be located.”

And in Malaysia, PMB Investment Bhd took home 4 Thomson Reuters Lipper Global Islamic Fund Awards. PMB Shariah Growth Fund won the Best Malaysian Equity Fund award; its Shariah Dividend Fund won the Best Malaysian Income Equity Fund award; the PMB Shariah Aggressive Fund (PMB SAF) won in the Best Malaysian Equity Fund.

Yes, it is in Your Own Backyard!

So often people look for entertainment in all sorts of far-flung places, causing great expense and a lot of stress. Americans however, need to be made more aware of what is available, in  nature, right here!!!! Yes, the great outdoors!

According to a report put together by the organization that evaluates America’s GDP – the Bureau of Economic Analysis – outdoor recreation comprises 2 percent of the nation’s GDP.The industry has a gross national output of $673 billion and growing faster than the entire American economy. This figure is higher than other principal industries including: agriculture, petroleum and coal products manufacturing, and computer and electronics manufacturing. The report also found that the industry has a gross national output of $673 billion and is growing at a faster pace than the overall U.S. economy

As such, outdoor recreation – yes, our outdoors – is finding its own place on the government’s agenda.  Ryan Zinke, US Secretary of the Interior recently put forward two new initiatives pushing the federal government to make outdoor recreation a national priority for the foreseeable future. These are:

  1. Designation of a senior level official at the Interior Department to supervise outdoor recreation, while safeguarding the needs of the country’s recreation aficionados.
  2. A stipulation that all major departmental offices will outline their own plans for how they will advance new outdoor recreation opportunities AND bolster the current ones.

A new recreation advisory committee will also be created; one of its tasks will be to offer the secretary “diverse viewpoints on steps that can be taken to improve outdoor recreation in the United States.”

These sentiments of how the great outdoors positively impact the US economy have been echoed here, with a finding that: “outdoor recreation is a vital economic force that not only creates billions in spending and millions of good-paying American jobs, but also creates healthier communities, healthier economies and healthier people.”

Executive director of the Outdoor Industry Association, Amy Roberts noted that:

“One-hundred and forty-five million Americans, from all walks of life, participate in outdoor recreation every year, and 7.6 million Americans have good-paying jobs that rely on the outdoor recreation economy. These reports show that all districts have something to gain when our federal and local policymakers support our public lands and waters and invest in outdoor recreation.  Outdoor recreation provides much-needed diversity to local economies, but also brings this country together. Across our country we have seen members of Congress, governors, state legislators, mayors and other policymakers understand the value of outdoor recreation for their local economies and communities. It is critical that we continue to invest in and support this growing and powerful recreation economy so that we can all continue to thrive outside.”


Optimism on America’s Economic Strength

In this video, FOX Business Network presenter discusses the solidity of the current US market.  He points out that the 10-year treasury yield is standing at 2.99% and discusses the industry with Chief Economist at Moody, Mark Zandi.

Zandi emphasizes the importance of a strong economy (businesses need to be able to sell what they are producing; i.e., people need to have the money to buy) as if that is not performing well it will negatively impact the performance of stocks.

Yields are beginning to flatten and possibly invert, signaling the beginning of a recession, with simultaneous anxiety and fear that the Fed will overdo it and raise rates too quickly. But Zandi believes the economy will grow very strongly especially with the tax cuts coming and big government spending increases. This will result also in a decline of unemployment – going into the low 3s which hasn’t happen and when does approach that, leads to problems like higher interest rates and inflation. Unfortunately Zandi believes, the Fed always overdoes it.

If you look at the personal saving rate it is close to a record low and the Fed is sympathetic to people’s fears and try to ensure the inflation rate does not develop or at least, not at such a high speed. That’s why Zandi believes “the Fed probably will raise rates, but slowly in the context of very low unemployment and the raise in price pressures that are developing.”

Corporate Solar Acquisition

In the last few years, an increasing trend has been the appropriation of corporate solar products. One cannot help but be impressed with Google’s beating its 100 percent renewable energy target and the fact that it currently has “contracts to purchase 3 gigawatts of output from renewable energy projects, which is by far the most renewable energy purchased by a corporate entity to date.”

This trend is extending beyond the large corporations (which also includes Microsoft).  Corporate sustainability strategies are being developed in smaller firms like Taylor Farms and Kingspan and since 2012 there has been over 1 gigawatt of DG solar installations occurring each year.

Experts have however, indicated that this year there will be a slump in corporate solar acquisition with a readjustment of the market. Also the last two years have been very expansive in this area due to the coming end of the federal Investment Tax Credit and the fear that went along wit that.   As well solar tariffs have been putting large corporations off somewhat.  But still, news until now is extremely positive and optimistic for the future even if that future takes a break.

Investors Bring Ethics Into the Spotlight with Open Letter to Apple

It’s not often that business matters intersect so directly with ethical discussions, but activist hedge fund JANA Partners wrote a letter to Apple with the California State Teachers’ Retirement System (Caltstrs) earlier this year asking them to become more directly involved in efforts to protect children from the potentially harmful effects of technology and screen time. The letter was called “Think Differently About Kids” as is open to the public.

Together, the two funds hold around $2 billion in Apple shares. They called upon Apple, one of the “most valuable brand names in the world”, to “offer parents more choices and tools to help them ensure that young consumers are using your products in an optimal manner.  By doing so, we believe Apple would once again be playing a pioneering role, this time by setting an example about the obligations of technology companies to their youngest customers.”

Th letter, written by JANA managing partner Barry Rosenstein and Calstrs head of corporate governance Anne Sheehan, claimed “it would defy common sense to argue this level of usage, by children whose brains are still developing, is not having at least some impact, or that the maker of such a powerful product has no role to play in helping parents to ensure it is being used optimally.”

The letter goes on the explain the various impacts that screen time has on kids, including a decrease in focus, increased suicide risk, sleep deprivation, and decreased empathy, among others.

“We believe there is a clear need for Apple to offer parents more choices and tools to help them ensure that young consumers are using your products in an optimal manner,” the letter states.

Apple issued a statement, but did not directly address the letter. “We think deeply about how our products are used and the impact they have on users and the people around them,” they said. “We take this responsibility very seriously and we are committed to meeting and exceeding our customers’ expectations, especially when it comes to protecting kids.”