In investing there is always the hype of future great things or the next great thing to bring in easy dollars. As today is Valentine’s Day, there is also much hype in romance, but it is hoped you find and keep the long-term lasting relationship variety. One of the reasons there is hype is society changes and as society changes some of the things that were not allowed, or honest decent people did not do in public are now okay to do. It does make society better or worse, just changed and with change becomes a potential opportunity to cash in. In the last few years, we have seen changes in marijuana or cannabis laws and the startup of new companies. The same thing happened with betting on the internet. Previously, you needed to go to Las Vegas or have a bookie at a bar or something of that nature, now governments are encouraging gaming for potential tax revenues.

In an article by David Parkinson writing an opinion in the Globe and Mail, Pennsylvania based Penn Entertainment Inc has long run casinos and horseracing tracks, but during COVID when people had extra time and money to gamble, pushed into online sports betting as governments legalized the activity. Penn Entertainment bought Score Media and Gaming and Barstool Sports.

The shares have fallen 82% from their highs which means a hedge fund is on the prowl to increase share prices. In this case, in a securities filing HG Vora Capital which owns 9.6% of the shares wants management to do something to increase the share price. One suggestion is to change some of the Board of Directors of Penn with people affiliated with HG Vora Capital.

Initially Penn Entertainment bought minority stakes in Score Media and Barstool Sports to test the waters, then they bought the rest of the companies, but they do not show good results.

Penn paid $163 million for 38% of Barstool, later it paid $550 for the remaining part. In August 2022, Penn decided to partner with ESPN and sold the company back to the original owner for $1 plus 50% of any proceeds from a future sale of Barstool. The agreement with ESPN is $1.5 billion for marketing and media rights.

For theScore, Penn paid $2 billion for the app, half in cash and half in shares. The intention was to expand theScore across the US, but it was decided to shut down the US business to go with Barstool Sportsbook which no longer exists.

For theScore, the app had 3.6 million users when Penn Entertainment bought it. Penn had thought that as an owner of casinos some of the people would use their products but that did not happen and 73% of users were already in the ecosystem – checking scores and reading sports news.

Across the US, Barstool had a 1.9% share as of last spring. Essentially the company has spent $4 billion on sports betting with little to show for it. David Katz, an analyst at Jefferies wonders How are you going to show a return on that?

The competition is not doing much better, Wynn Resorts has pulled out of 8 states because of the money to acquire and retain customers or outsized marketing spend. (some of the money is seen if you go to or watch professional sports on TV, you will notice the advertising). Two other rivals FanDuel and DraftKings have lost a lot of money, DraftKings has lost $4.8 billion since 2020. The good news for them is their names has brand recognition and they are losing less money.

Linking to dividend paying companies, there is money to be lost on hype and a little to be gained. For the most part if something is hyped, watch it from a distance because what goes up will come down and then when companies actually make money, they may go up again. If you spend on the hype, ensure you have a very good idea when you to sell or it will be a long-term holding to try to get you money back. The good news with dividend paying stocks is you are expecting it to be a long-term holding so having patience is a wonderful thing.

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

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In financial planning myth there is a level of money which if people had they would not go to work and many people strive towards the number. What number in the bank and investments would you need to retire? There is no perfect number, but it generally depends on the cost of the lifestyle you presently enjoy. In reality people live on the lowest levels of government assistance as their prime income. Often in the financial papers you will see formerly very well-paid people – moving to another position. What is their motivation? for at the income they received they should be able to retire.

In an article by Michael M Grynbaum of the New York Times News Service, Jeff Zucker the former CNN president and one time executive producer of the Today Show is investing in Media Res through RedBird IMI. Mr. Zucker founded a private equity firm called RedBird Capital. The company teamed up with Sheikh Mansour bin Zayed aal Nahyan, an Emirati royal to form RedBird IMI. The company Media Res was founded by Michael Ellenberg who is also the CEO.

RedBird IMI has invested in a sports news platform, a documentary studio, a children’s entertainment company and is making a bid to buy The Daily Telegraph in London, UK.

Mr. Ellenberg said Mr. Zucker’s investment will allow him to hire more people and expand the studio’s domestic and international production slate. Media Res biggest TV show is the Morning Show on Apple TV.

Linking to dividend paying stocks, people buy dividend paying stocks for all types of reasons and having regular income is the key. Ideally in your life you will have options – whether to work, have projects around the home, take longer time off, and enjoy life with the income you receive. Although in every area of the world there are stunning things to see for free thanks to the beauty of nature, it is always nice to have extra money in the account.

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

In the world of CO2 emissions, the easiest way to drop emissions was for an economy to go into recession. If you compare the emissions during the yeas of COVID, emissions were down but it was a heavy price to pay with many people needing government assistance to live their lives. For most people going through a recession is not a good way to cut emissions and ideally should be avoided and there should be a better alternative.

In article by Geir Moulson of the Associated Press, the largest economy in Europe is Germany and carbon-dioxide emissions fell to its lowest levels in 7 decades. Germany aims to go closer to 0 by 2045, but it has a long way to go.

The Agora Energiewende think tank showed Germany emitted 673 million tonnes of CO2 last year a decline of 73 million tonnes. The figure was 40% lower than one in 1990.

Renewables of solar and wind accounted for half of the country’s energy production up to 56% of energy production up from 47.2% in 2022. Electricity made from coal dropped to 8.9% from 12.8%. Nuclear power was 1.5% down from 6.7% as 3 nuclear plants were shut down.

Germany is home to many energy intensive companies including chemical and metal industries. Germany’s economy also has done well because of high energy prices, global economic weaknesses and interest rate hikes to fight inflation.

Agora calculated that only 15% of last year’s emissions savings constitute permanent emissions reduction resulting from additional renewable energy capacity, efficiency gains and the switch to fuels that produce less CO2 or other climate friendly alternatives.

Economy and Climate Minister Robert Habeck, a member of the environmental Green Party who is also Vice Chairman, said Germany has laid the foundation for future growth in renewable energy by moving to expand solar and wind generation. We are making visible progress on the road to climate neutral electricity supply.

Linking to dividend paying stocks, governments can and will make policy changes for what they believe is best for their countries, often times there are delays between the actual and ideals the governments want to achieve. It is possible to agree with the ideal, but the importance is how the government wants to get there and what incentives they allow for people and companies to adjust. It is never a straightforward line, but many dividend paying companies have adjusted in the past and as an investor you need to believe they can adjust in the future.

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

Every year analysts offer the outlook for the economy in general and it is updated every day and every quarter to does the company meet expectations. It is a challenge to do consistently because of change in the world, there is always something to react to. If expectations are not met then the stock price will fall and people will decide if the management is doing the right thing or not. The stock market being large means if the stock price falls, various hedge funds will become large buyers to enhance values. If the company meets and exceeds expectations, more individuals will be buyers because they see hope for the future.

In an article by Caroline Valetkevitch of Reuters, the big expectation for 2024 is the federal reserve will cut interest rates as inflation has slowed. However analysts worry about slowing economic growth.

S&P 500 earnings are expected to rise 11.1% after a slow rise of 3.1% in 2023. However analysts believe earnings have to rise because according to LSEG Datastream data the market at the end of December was trading at 19.8 times forward 12-month earnings versus the normal 15.6 times.

The markets ended December with a rally and within striking distance of its all-time high finish. The S&P 500 rose 24.2% for the year. (if you owned energy and big tech, you did well).

Sameer Samana, senior global strategist at Wells Fargo Investment Institute noted the market trading at its current levels demands earnings to show strong growth in 2024.

Gary Bradshaw, portfolio manager at Hodges Capital Management in Dallas noted besides the consumer seems to be healthy, inflation getting better, employment is still strong, interest rates going down, many companies have streamlined their businesses and margins are decent. (in other words companies cut costs and kept good margins).

Linking to dividend paying stocks, in general when interest rates fall, companies which pay dividends are more competitive with other companies for the dividend either stays the same or ideally grows. In addition, possible capital gains are expected because they are able to keep their margins through the cycles to earn profits to pay dividends. It should be a good year.

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

We are all aware the economy is changing or slowly changing from an oil-based economy to one that runs more on renewables. In some places the desire to change is ahead of the reality, and that includes the country of United Kingdom or Britain.

In an article by Eshe Nelson of the New York Times News Service, a startup company has done research and wants to expand by manufacturing their product, a classic hopeful success story. The company called Paragraf, makes chips using graphene and can check for defects in electric vehicle batteries to prevent fires and other uses. The company identified a need and decided to ramp up production from thousands to millions. That is the good news.

The bad news for the company to uses its existing facilities, the cost to bring electricity to the site was going to be $1.5 million. Why, because Britain’s electrical grid is behind the times as a result of years of underinvestment.

The politics said they will need relatively low-cost electricity to move off the use of oil, as a general statement people can buy into it. Companies investing in solar power and wind farms have done a good job, but the reality is the low-cost electricity has to brought to urban areas and that is the problem. The planning and grid up grades needed are block by a system which gives considerable power to local planning authorities and who wants to look at a tower system in the country?

In Britain they have the National Infrastructure Commission which advises the government, offered greater incentives to local planning authorities which can approve the infrastructure upgrades. Will it work? no one knows, but it is a start.

Jeremy Hunt, the chancellor of the Exchequer (Budget Chief) said planning and grid reforms are 2 of the most critical changes in the budget to revive growth.

The opposition Labour Party’s Leader, Keir Starmer, the party will bulldoze through Britain’s restrictive planning system to get the grid moving. (note most of Labour support is in the urban areas).

The company, Paragraf, decided rather than wait for an upgrade by local council paid the $1.5 million to a grid operator to upgrade the building. The company based in Cambridge, England wanted to stay and grow in England as opposed to moving to the US with the help of the CHIPS Act.

Linking to dividend paying stocks, in all countries around the world there usually is a difference between what the politicians talk about and the reality of the situation, fortunately profitable companies tend to have the choice of waiting for the government or moving without them. All companies work with governments of all stripes and sizes, but sometimes all they want to do is carry on with their work. For your investments, what is the difference between government speak and reality on the business world?

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

In every sector there are lists and some of the lists people are more interested than others. Once you have accumulated savings, hopefully it generates income, dividends and capital gains and you can decide what you want to do with the money. Some you will reinvest, some you may live off and some you may give to a charity or charities of your choice. Recently one of those lists was in the press.

in an article by Maria Di Mento of the Associated Press, one of the lists connected to giving away money is the Chronicle of Philanthropy, it totaled more than $3.5 billion given away.

Topping the list is Warren Buffett, he moved 1.5 million shares of Berkshire Hathaway Class B valued at $541.5 million to the Susan Thompson Buffett Foundation. The foundation which includes 2 of his children and a son-in-law on the Board. The foundation provides scholarships in Nebraska and backs women’s reproductive health.

James Simon besides being a mathematician founded Renaissance Technologies hedge fund which has done very well every year. He and his wife through their foundation gave $500 million to the State University of New York at Stony Brook to boost scholarships, professorships, research and clinical care. Mr. Simons taught at the University and Mrs. Simon has earned 2 degrees.

Ross Brown, the founder of Cryogenic Industries pledged $400 million to the California Institute of Technology. The money will launch the Brown Institute for Basic Sciences.

Nike co-founder Phil Knight and his wife, Penny, pledged $400 million to the 1803 Fund. The fund will help redevelop the area of Albina which is in the Portland, Oregan area. The area was previously a thriving black neighborhood and has fallen in economic viability. The money is coming from the Knight Foundation.

Dan Gilbert and his wife, Jennifer, gave $375 million through their Gilbert Foundation to Henry Ford Health to build 2 medical centers. Dan Gilbert founded Rocket Mortgage and is Chairman of the Cleveland Cavaliers basketball team. One of the centers will focus on rehabilitation particularly those with little or no health insurance coverage. The other center will focus on research including neurofibromatosis which inflected one of their children.

Kenneth Griffin of hedge fund company Citadel LLC, gave $300 million to Harvard’s Faculty of Arts and Sciences for financial aid to undergraduates.

Mr. Griffin partnered with David Geffen to give $400 million to Sloan Kettering Cancer Center.

The Chronicle’s annual rankings are based on publicly announced gifts. In March, the list will include total gifts in 2023.

Linking to dividend paying stocks, when you have surplus income and can donate it you can donate whichever way you wish. It is noted most of the money donated is because the donor has a personal reason to help. All of us are interesting people, but it is often some organization has helped somebody we know over the years, for example when my father was in a long-term care in a hospital, a group gave PJs to the residents as a one-time gesture. My parents appreciated the gesture and a few years later when my surplus was able to cover it, I teamed up with a local organization to continue the giving. The local organization gets the publicity. There are many great causes to give, ideally the investments you make allow you to consider giving.

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

If you think about the country with the greatest number of people, often times you would think about China, but a new country has arisen – India. The country of India is complex, it is also one of the fastest growing economies in the world, with growth rates expected to increase 6%.

In an article by Alex Travelli of the New York Times News Service, India’s economy is booming, the stock markets is one of the best performing exchanges and similar to China, its infrastructure is changing fast. There is a hitch, investments by the private sector or companies is stagnant.

The goal of Prime Minister Modi is to catch up to China by 2047 and there is a shift in manufacturing from China to India. In addition, if you listen to politicians around the globe, they want to be dependent on China which allows India to step into a big gap.

The World Bank has applauded India’s commitment to infrastructure spending, but it is important after the port is made new, a new industrial park lures companies into building plants and hiring workers.

The stock market In Mumbai are worth nearly $4 trillion up from $3 trillion in 2022.

Foreign investment which averaged $40 billion has shrunk to $13 billion in the past year. One of the reasons is businesses are waiting and seeing what the government will do. Prime Minister Modi’s government is interventionist and sometimes he is correct and sometimes not so good. For example in August, the government announced sudden restrictions on laptop computers. That sent businesses which depend on them in a tailspin and the measure was withdrawn.

If the business is close to the Prime Minister, then regulatory measures seem to help them more often and the 2 biggest examples are the Reliance Industries and the Adani Group.

A factor in holding back the Indian economy is wealth distribution. In a population of 1.4 billion, 20 million are doing very well and consume products, buy homes and autos. Most of the rest of the sector is struggling with food and fuel prices or the lack of robust middle-income group.

The biggest wildcard is whether India can grab a significant share of global business from China. For example Apple is producing iPhone has a 5% market share. Apple builds about 7% of the world’s iPhone’s in India but want to increase that to 25% by 2025.

Linking to dividend paying stocks, companies and countries around the world have tried to gain growth over the expectations for generations. Sometimes it succeeds and sometimes it does not and only government spending is left. It is important as an investor to ensure the fundamentals are in your favor.

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

If you want to buy a new or used vehicle, you will likely be looking at GM, Ford, Chrysler, Tesla, Toyota and Honda, they dominate the market and most of us have one or more of their vehicles. However, the second biggest world’s economy is China and all those automakers are in China, but a different name leads the sales number.

In an article by Claire Fu and Rich Barbieri of the New York Times News Service. Chinese corporate giant BYD sold 3 million battery-powered cars. The total was made up of 1.6 million fully electric and another 1.4 million hybrids. BYD made $1.5 billion in the first half of last year.

According to the Chinese Association of Automobile Manufacturers, Chinese automakers sold 9.4 million electric vehicles and hybrids up from 6.9 million in 2022. In 2024, the expectation is 11.5 million.

China rules the supply chain for battery powered cars – from the mining and processing of cobalt and other materials used in batteries, to the deployment of robots that make the vehicles. In total 1.5 million people are employed in the manufacturing process.

One of the reasons China is in the lead for adoption of electric vehicles is government support.

Tesla has a large presence in China and is expected to sell 1.8 million cars worldwide. During the year. Tesla lost some market share to rivals as they introduced new electric vehicles.

BYD is large in the US, but rarely sells in the US because of high protection tariffs. To sell more cars, they are targeting Europe by building a factory in Hungary.

BMW is investing $1.4 billion in a battery plant in Shenyang.

VW which counts China as its biggest sales market, is moving more of its supply chain and manufacturing to China.

Linking to dividend paying stocks, most of us buy branded items and we think they are better. Sometimes the answer is not that simple. it could be high tariffs help direct us to lower tariff items. Government policies can help and hurt companies you invest in, do you know what the tariffs are for the companies you invest in?

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

If you had the job as a central banker to manage your country’s currency, you would love to have moderate markets. The economy has growth in it and while there are small fluctuations, the world sees your economy as good. However, the world and countries go in cycles and sometimes there are downturns, what should the central bankers do?

In an article from Reuters, it used to easy to be a central banker in China, growth was a given and the perception was China’s economy was the 2nd largest in the world and could offer an alternative to the world’s largest the US. Then COVID happened which included shutdowns, governments around the world wanted changes to manufacturing basis, the economy slowed and housing prices did not rise and began to fall. The prices of housing continue to fall and while the government has improved infrastructure greatly, most of it does not bring in revenues. What can Central Bank do?

Central Bankers only want the currency to float to markets when there is growth, when there is limited growth or no growth, the first idea is to use reserves to shore up the currency. In 2015, the bankers used that strategy to spend $1 trillion in reserves. In 2023, a different strategy was used. The central bank or People’s Bank of China (PBOC) defended the currency by signaling to markets what kind of selling it would and would not tolerate.

As the currency for the world’s 2nd largest economy and biggest exporter, the yuan’s value determines the price of goods around the world and trillions of dollars in capital flows. it also serves as a barometer of China’s challenges.

10 traders interviewed by Reuters said key warnings first emerged in June when the PBOC daily yuan guidance that determines the trading range, known as the midpoint, started to diverge from market expectations. In theory, the midpoint is based on contributions from 14 banks and referenced to the previous day’s trade and overnight moves, it should be easy for markets to predict the future.

In August, what traders saw the PBOC was signaling that it did not want the currency to go where the markets were pushing it. The PBOC encouraged state banks to be buyers of the yuan. This has worked and volatility has been contained.

The China FX Market Self-Regulatory Framework which is overseen by the PBOC told major state-owned banks to cut the dollar deposit rates, which would encourage deposit holders to switch from dollars to high deposit rates in the yuan. In addition, all state banks have customers which export and often times there is a need for dollars to pay the bills. In the past, the surveys had been done monthly, recently the needs of the large dollar exporter is monitored weekly.

For now the price of the yuan is stabilized, but the largest exporters pay attention to dollar payments.

Linking to dividend paying stocks, companies which have operations in multi countries have the benefit of diversification, but they also have currency risks. Most of the time, it is a low risk and is easily managed. Once in while currencies are a risk, do you know what the risk is for your investments?

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