If you are like me, at this time of the year you like to see the gold and silver Christmas decorations, and you are more likely to like the gold than the silver. Both colors complement each other but we all have a bias.

In an article by Clyde Russell of Reuters, on a percentage basis, which underlying metal is performing better gold or silver? It turns out to be silver since October 2023 going from a low of $20.67 an ounce to a high of $54.38 or a gain of 163%. Gold is up from $1,813 to $4,381.22 in the same period or a gain of 142%.

The last time silver outperformed gold was from October 2008 to April 2011 with a high of $48.24 an ounce or an increase of 421%. Gold rose to a high of $1,920.03 or a gain of 168%.

Silver does go up when the price of gold goes up for the same reasons as a hedge. The other reason silver goes up is industrial demand and limited scope to boost a mine’s output.

The LSEG data shows demand rose from 644 million ounces in 2023 to 689.1 million ounces in 2024. The demand is partly due to solar installations which represent 600 gigawatts in 2024 and is expected to increase to 1,000 by 2030.

The majority of silver is produced as a byproduct of other metals such as copper, lead, zinc and gold.

Linking to dividend paying stocks, with everything in the world, when a commodity price increases, people look for alternatives, although many of the alternatives are not viable until the price of the commodity drastically increases. Before buying great amounts of stock, remember to do your homework, what alternatives are there? when would an industrial user switch over? If the price still needs to be higher than it is reasonable to look at stocks in the space.

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

When the markets go up at reasonably high level, it is always worth asking is this a bubble or is something else. For everyone who invests in an asset hopes it goes up in value, but when do you sell or take advantage of the higher asset prices? The answer is always in hindsight, you have perfect information, but for the most of us it depends.

A little over 25 years ago, the stock market was going up based on the dot-com bubble. The internet was recently opened to the public and companies that had an idea were getting funded. Everyone thought the dot-com revolution was going to free up time and energy and we would all live a life of semi-leisure, but not surprisingly that did not happen.

In an article by James McGeever of Reuters, in 1999 the top companies by valuation were GE, Citibank, Exxon, Walmart, Home Depot and 5 tech companies The market fell by 65% and it took 14 years to revisit its highs. At its peak, there was a frenzy of public offerings and a raft of companies with shares valued at triple-digit multiples of future earnings. (also there turned out a lot of insider transactions on the public offerings).

This year the top 10 companies by market capitalization are tech companies including Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, Telsa, Berkshire Hathaway and JPMorgan. The combined market cap of the top 10 today is almost $22 trillion or 40% of the S&P 500 index.

Torsten Slok, chief economist of Apollo Global Management the 12-month forward earnings valuation of today’s top stocks is higher than it was 25 years ago. However back then the S&P tech sector was trading at 50 times earnings, as opposed to 29.5 times at the moment.

Linking to dividend paying stocks, the only thing we know for certain is stock prices go up and down. If you have made a lot of money, it is easier to sell something which you made money and buy a defensive stock that pays a healthy dividend. You will leave some money on the table, but you will worry less or can sleep better at nights. We all want more; the question is always how much more and how much risk are you willing to a accept? both now and in hindsight. Trimming a holding is better than saying I should have. If you are an investor, you have will have I should have in your portfolio, for they tend to be long-term holdings by default. Have long-term holdings for a good reason.

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

When President Trump started his term in office, he said Greenland should be controlled by the US because of its strategic position and minerals which are located in it. Getting the minerals out of Greenland, is a different story, but it has led to other possibilities. President Trump often talks about ending the war in Ukraine and Russia, because he wants peace. It turns out Ukraine has minerals and other assets that he is interested in. In these discussions, it is not apparent which companies would be involved in the minerals, but they would be American based.

In an article by Sonia Rolley and Portia Crowe of Reuters, the US is open to exploring critical mineral partnerships with the Democratic Republic of Congo (DRC). The DRC is rich in cobalt, lithium and uranium among other minerals.

The other aspect of the DRC is there is war going on with the Rwanda backed M23 which has seized huge territories particularly in fierce fighting this year. Will President Trump stop this war?

The state department said the US has worked to boost US private sector investment in the DRC to develop mining resources in a responsible and transparent manner.

The DRC’s spokesman Patrick Muyaya, said they are seeking diversified partnerships, and they have reserves and it would be good American capital could invest in the DRC.

Andre Wameso, deputy Chief of Staff to President Felix Tshisekedi, travelled to Washington for talks.

At the moment, the DRC’s mineral supply chains are dominated by China. The country of China has the Belt and Road strategy in countries around the world, whereby they build infrastructure and typically Chinese companies run the systems.

The US does not have state-owned companies like China does, and no private American mining companies operate in the DRC. Would the DRC give mining concessions to American companies?

Linking to dividend paying stocks, every country in the world has assets, although some are more valuable than others. When countries are interested, they are looking at the assets and/or strategic locations and hopefully what results is good for the local people. When you read about partnerships with countries always be cynical to see what it is really about. If it makes sense to you and the company, you invest in is doing a partnership then it is worth holding on to or look for alternatives.

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

In every administration, particularly more right than left, the idea of cutting back regulations to unleash the power of private business is a theme. At times, administrations on the left tend to want to regulate or do government actions for all the wrongs of the economy. There is no magic wand, but administrations tend to move back and forth as interest groups tend to want to get rid of regulations they do not like.

In an article from the Associated Press, recently there was a outbreak of E coli food poisoning tied to onions in McDonald’s. The company did the correct thing, it sent the onions back to the supplier in this case, Taylor Farms which is a large food company based in California, served burgers without onions and after a few days new shipments of onions were received, and all was back to normal. The Federal Food and Drug Administration (FDA) said there does not appear to be a food issue related to McDonald’s. The issue was sales went down and now McDonald’s is spending an extra $100 million ad dollars on bringing customers back to the stores.

Linking to dividend paying stocks, all profitable companies want to work with the government and maintain their high margins. No amount of regulations can correct the wrongs of the entire economy, but governments sometimes try. Businesses have lobbyists to ensure that their interests are protected, and regulations are reasonable to have good products. All over the world, we have seen and will continue to see fake and bad products in the market and profitable companies have a duty to fight against the products. In the early 1900’s there was little food regulations, and it was known as the decade of the bellyache, and we do not want to go back to there. One tends to believe the use of AI will help ensure the regulations that are good are easily followed and we will see. In the meantime, we will see how much of the regulations are cut with the new administration in Washington. Will it cost companies money?

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

One of the roles of the central bank of any country is to monitor and maintain the value of its currency. The bank has a number of methods to do this but one method to attract savings is increase the interest rate. People and institutions will buy the currency and keep it to earn higher rates of interest guaranteed by the government. If it works, the economy is stablizied and eventually the central bank can lower interest rates.

In an article by Alexander Marrow of Reuters, in mid August the Russia Cental Bank hiked interest rates by 3.5% to 12% as the Russian currency the ruble fell in foreign exchange trading.

The reason being the falling price are high government spending on the military and Western govenment’s continuing sanctions on Russian trade.

Timothy Ash, senior EM sovereign stategist at BlueBay Asset Management said as long as the war continues it just gets worse for Russia, the Russian economy and the ruble. Hiking interest rates may slow the decline, but the core problem of the war is still ongoing.

Russia’s widening budget deficits and stark labor shortages have contributed to rising inflationary pressures. (Russia was considered an oil and gas economy and is selling less oil and gas).

Linking to dividend paying stocks, there are always alternatives to invest. As a dividend investor you need to pay attention to the core reasons why you invest in any stock. When that changes it is time to find alternatives.

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

Prior to COVID, China was the world’s second largest economy and seem to be growing towards number one economy of the US and people suggested it was not going to long before China was number one. The Chinese economy was generating income from their huge balance of trade exports and needed to spend the money somewhere. It had already become the largest buyer of US Treasuries. Two of the methods to spend money were the Silk Road and Belt and Road initiatives. The Silk Road is the connection between Europe and China that has existed for hundreds of years, you can think about Marco Polo and his adventures in 1271 to 1295. China built roads and trains to connect the Silk Road. The other initiative is the Belt and Road.

The Belt and Road is for China to build ports and Chinese military bases in other countries, both for commerce and military purposes. The Chinese offered countries large infrastructure investments and a possibility of expanding exports from their country to China. It turns out Chinese companies did the work using Chinese personnel and Chinese financing, there was very little for the host country, but new infrastructure. The Chinese were and have used their economic power to go to target 150 countries.

One of the G20 countries, China signed agreements was with Italy about 4 years ago. Politicians come and go in Italy and every other country and a new government was elected in Italy. The Italian Defence Minister Guido Crosetto said his government is working to break the agreement because it did very little for the economy of Italy. The benefits seemed one side towards China. The Prime Minister of Italy, Giorgia Meloni, was more diplomatic saying she wanted the deal changed by December because China is both a competitor and a partner.

Linking to dividend paying stocks, countries similar to companies develop alliances and partners across the world. Sometimes companies use subsidiaries, sometimes they use partners, whatever works to grow the revenues of the company. Partners can change over the years, it is a balancing act and human relationships as well as the company can it bring in more revenues if it does it internally. There usually is no one answer and it is not uncommon to see new partnerships based on different circumstances. Do you like the partnerships of the companies you invest in?

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

One of the wonderful aspects to the stock market is people can have different opinions and be right. People buy stock for multiple reasons although the top reason is to be worth more at the end of the day than the start. It is good to do your homework, make an investment and others agree with you. However sometimes you can do your homework and others disagree, if you were committing a billion dollars to your idea, you want to scream why does not everyone see what I see?

In the book. When the Wolves Bite by Scott Wapner published by Hachette Books, N Y, 2018 the wolves are two icons of Wall Street. Carl Icahn and William Ackman and the company they see differently is Herbalife.

William Ackman through his company Pershing Square Capital Management was short the stock. Carl Icahn was long and owned enough shares to be on the Board of Directors.

The men are in the hedge fund world, and lasted over 10 years through wins and when the win big, the wins are in the billions. Although sometimes they lose money, but usually it is not more than hundreds of millions.

Each of the investor spent time doing their homework, talking to the President as well as trying to figure out how does the company make money? Who buys the product?

At the time, Herbalife was a mixture of selling products to distributors who made money selling product and recruiting more distributors. Which one is more important? This is where the decision of the 2 investors was different.

Both companies hired lobbyists to sell their story to the public and equally important to the regulatory body of the government, in this case it was the Federal Trade Commission or FTC and its Chair. William Ackman wanted the FTC to say Herbalife was a pyramid scheme, Carl Icahn wanted the FTC to say it was a normal business but could be cleaned up a bit.

Linking to dividend paying stocks, a book such as this one shows some of the methods in which the players are linked. Often times they have met, crosses paths at conferences (some conferences are seemingly more important than others, depending which industry you invest in, it is important to know about them, in the book the Ira Sohn Conference was very important) worked together and worked apart from each other. On Wall Street good ideas are good ideas, how you profit from them is the question.

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

Many years ago in my job at at a bank, woman had a definite glass ceiling and while many good women were working there, there was a unwritten rule that woman could not be promoted to manager of a bank branch. Fortunately times have changed and more women are represented in the Board and maybe more than one CEO of a money centered bank in New York.

In an article by Mathieu Rosemain of Reuters, in France the biggest telecom company is called Orange and Christel Heydemann is to become the new Chief Executive Officer.

She will become the third woman CEO of the Paris CAC 40 blue chip index after Engie’s Caherine MacGregor and Veolia (a utility group) Estelle Brachlianoff.

Ms. Heydemann is a graduate of France’s elite engineering school Polytechnique and will replace Stephane Richard who was convicted of misuse of state funds but denies any wrongdoing.

The French government has deemed the company Orange to be strategic which means dealing with the President of France and the Finance Ministry overlooking their shoulder.

Orange is doing things similar to American telecom companies capital heavy investments in the new generation of internet mobile networks and broadband fibre-optic infrastructure. Its biggest markets are France and Spain. In addition in the mobile phone business there is a low cost competitor called Iliad’s Free Mobile which has resulted in price wars. Share prices are trading at prices about a third lower than 5 years ago.

Linking to dividend paying stocks, in this case it is often when governance is in a bit of a mess that women get promoted to the CEO’s position. However, it will be when Ms. Heydemann cleans up the company for investors. Women make up 50% of the population there is no reason to believe that they do not have the skills to be the CEO, but in the world change is slow. As investors whether it is a man or woman running the company should not matter, what matters is a profitable results.

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

If you listen to the President, the vaccine trials are going to be here sooner than you think, probably very soon. In an article by Lewis Krauskoff of Reuters, according to a UBS analysis 40% of the market’s gains since May can be pegged to hopes for vaccines to protect against COVID-19.

We know every major pharma company is working on a vaccine and as individuals we hope that one or more will be successful. We know because of the shape and adaptability of COVID it is a very hard task. In normal times, arriving at a vaccine takes years of work and is one of the biggest factors which allow big pharma to have a 21 year monopoly on their drugs before generic drugs can be made and sold at a fraction of the cost. The normal life cycle of a new drug is years as it goes through ideas to research in animals to sampling of a few people, then more against a placebo then an even bigger number to ensure that the drugs works and has few side affects for the general population. Just about every drug has a side affect, the trials for people will tend researches which organ or organs are being affected with the new drug or under intentional consequences. The decisions mean only a few drugs are released every year and those that do can generate billions in sales which is the reason to invest in big pharma.

In the article, Walter Todd, chief investment officer of Greenwood Capital in South Carolina said any news to the contrary could be a risk to the market.

There are at least 30 vaccines currently being tested in humans according to the World Health Organization and Liz Young, director of market strategy of BNY Mellon Investment Management said, we are setting ourselves up for success in the sense if you you throw enough spaghetti at the wall, hopefully one noodle sticks.

The leading companies are Pfizer, Moderna, AstraZeneca, Johnson &Johnson and Novavax.

Once a vaccine is approved and that will be great news, the questions of how easily and quickly it can be distributed will arise and according to Art Hogan, chief market strategist at National Securities, the time line is expect to be longer.

Keith Parker, head of US and global equity strategy at UBS believes an approved, broadly distributed and accepted vaccine will send the markets up 8% or add 300 points to the S&P 500. A disappointing clinical trial could result in a loss of 3% or 100 points.

Linking to dividend paying stocks, we all hope there will be a vaccine sooner than later, but try not to listen to the optimism of the President. Vaccines take time, there is a process so the everyday person has confidence in the vaccine and the process. Do you have confidence in the process?

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