Dividends and Beware the black swan: Barclays

At the end of the possibility curve that is a section for the unknown and it is called the Black Swan. Jake Lloyd-Smith writing for Bloomberg News outlined some of the concerns Barclay’s Bank have concerning commodity prices. Last year commodity prices increased and that was a good thing for investors. What could go wrong or why would prices decrease this year? According to a report written by Michael Cohen and Dane Davis many things:

China, Russia, the Middle East and Turkey can easily have an effect.

Venezuela might default on its bank loans

Commodities must move from one country to another which there is always a concern about supply routes

Relationships between countries particularly when President Trump says or tweets something.  (while blaming Ms. Clinton for the situation in the Middle East, asked what he would have done -he said he would have left enough troops to secure the oil fields. Considering we are in the 21st century and that talk – to the victors, the riches are taken is a few centuries old not sure what will come from the White House)

Trade wars between China and the US; the US and Mexico;

Campaign rhetoric from elections coming true.

Linking to dividend paying stocks, somewhere along the lines there will be significant change in the normal economic patterns. Who will change is what we will find out in the future. Some of the events will radiate from the White House for no one is quite certain what the priorities of the new administration are and how the White House sees their role in the world. Ideally, if you own companies that have near monopoly conditions, you can rest easier until the White House begins to sort itself out and predictions on how it will govern come easier.

There are more questions than answers, till the next time – to raising questions.

 

Leave a comment