TPW Investment Management

Weekly Musings

Friday Musings

Happy Start to Memorial Day Weekend!

Happy Start to Memorial Day Weekend!

And what a week it was - lots of public events following last week’s Webinar with GlobalX.

This week we laid out our Lower for Longer Global Growth thesis & discussed its investment implications in a 30 min Real Vision interview (public link forthcoming, link below for subscribers); co-hosted a great conference call with our friends at Signum Global Advisors on the Political & Market Implications of the current EU Parliamentary Elections (link below) and finished up this morning on BTV's The Open show with Jon Ferro and strategists from both Morgan Stanley and JPM Asset Mgmt - great company for TPWIM!

Watch or listen for our current thinking & see what’s upcoming below.

Two other thoughts: First, in fast moving markets like the past few weeks technical levels are important. As I see it global growth stories: China, metals, miners are quite oversold; UST, particularly long duration, are overbought; Europe eq, US HY are sitting on important 200 day support levels; & the S&P and US tech are roughly 2-3% away from such support.

We remain of the view that the current pullback is a healthy one with ACWI off ~5% from recent highs & ACWX (ACWI ex-US) off ~10% or so. Holding the above noted levels might be the difference between a healthy and an unhealthy pullback.

The other thought revolves around technology and how quickly its globalizing thrust is being replaced by a Balkanized regional or in a few cases country focus. It's not just China and the US either, India is looking into offshore ecommerce companies, Europe is considering how to treat Huawei while supply chains shift from global to regional.

Tech is rapidly becoming a 4th driver to our Tri Polar World (TPW) framework, joining each region’s growing ability to Self-Finance, Self-Produce and Self-Consume; perhaps tech is now becoming an ability to Self-Innovate?

Speaking of TPW, McKinsey just came out with a study that really validates our thesis - check it out here… can’t say its beach reading but can say it’s well worth a look.

We got into it a bit on BTV with JPM’s strategist but I continue to hold the view that US tech is most exposed to a Trumpian Full Monty on China tariffs (25% on full $500B) as well as any further acts like the Huawei kneecapping. China tech (KWEB) is off ~18% since recent high vs ~9% for US Tech (IYW); KWEB is off close to ~40% from its 52 week high set early 2018 vs ~9% for IYW which recently set high. Big China tech is much more insulated than US tech.

Looks like it's going to be a beautiful beach weekend here on the East Coast - enjoy, but not too much - just like the markets the weather can change (forecasts for mid 90s next week in NYC ugh).

TGIF!!

Jay and Jamie

 

Upcoming TPWIM events 

May

5/15                                    Joint webinar w GlobalX (Replay to come next week)

5/20                                     RealVision interview on TPWIM’s Lower for Longer Global Growth Theme (Recording for subscribers)

5/23 (10:30am EST)           Joint Conf Call with Signum Global on EU Parliamentary Elections - Political & Risk Asset Implications (Recording of Call)

5/24 (9:00am EST)             Jay was on Bloomberg TV: The Open (Short Clip)

 

June

6/3 & 6/4                             Inside ETF Smart Beta Conference

6/4 (11:40am EST)             Jay speaking on the panel “Active 2020: Strategies to Generate Alpha”

6/18 (10:30am EST)           Joint Conf Call with Signum Global on US Political Situation and Outlook

6/27 (10:30am EST)           Joint Conference Webinar with HAN ETF - Europe’s Only White Label ETF Provider

Trade & Tariffs in a Tri-Polar World: Investment Strategies

James Gardiner