After Labor Day, traditionally people came back to the workplace ready to implement the fall plans of the company. Everyone is back to work and what are the possible consequences to implementing the fall plans?
In an article from Reuters in August, they picked 5 broad themes likely to dominate global financial markets:
We all know with COVID and stay at home orders for health reasons, tourism is down but how much?
Spain welcomed 75% fewer tourists than in June 2019. Thailand’s Phuket had just 1% of the visitors it had before the pandemic. Turkey tourism revenues were $3 billion as compared to a normal $8 billion. Kenya normally received 2 million visitors in 2019, in 2020 the number was 300,000.
Similar to most regions, tourism is a major draw and contributes to 6% of GDP and 8% of employment. When the numbers are down all tourist economic spending is drastically down.
Headwinds in Asia
For many years, growth in China has been a given, but lately Chinese and growth are not in the same sentence. China is suffering from slowing credit growth as the government lowers leverage and debt from local governments. Thailand is suffering from lack of tourism and the Phillippines might cut its own bank reserve requirements.
Is inflation making a comeback in the US or can the Federal Reserve make the case for reeling in stimulus sooner than later?
Most of Europe’s big insurers have stripped cover for the pandemic from their policies. Insurance companies bottom lines are increasing including France’s AXA, Italy’s Generali and Germany’s Allianz. Other companies include Zurich Insurance, Aegon and NN from Holland, and the UK’s Aviva, M&G, and Prudential.
It is not only the voting whether the right or left wins, but the debt of the country. The Euro set up the Common Framework debt relief plan and Zambia is the first case. The Euro needs Zambia to be successful.
Linking to dividend paying stocks, with every investment there are always headwinds and it is easy to focus on the glass half empty. As an investor you want the glass half full view where the company can still make profits to pay dividends and has the ability to grow market share.
There are more questions than answers, till the next time – to raising questions.