Thu, 22nd June 2017

Anirudh Sethi Report


Archives of “March 3, 2017” Day

The Fed Is Preparing $1 Trillion In QE For The Next Recession: Deutsche

While in recent weeks there has been a material increase in Fed balance sheet normalization chatter, according to a new report from Deutsche Bank analysts, it may all be for nothing for one simple reason: should the US encounter a recession in the next several years, the most likely reaction by the Fed would be another $1 trillion in QE, delaying indefinitely any expectations for a return to a “normal” balance sheet.

As a reminder, as of this month, the duration of the latest expansionary cycle – as defined by the NBER – has reached 93 months, surpassing the 92 months of the 1982-1990 cycle, and is now the third longest in history. Should the cycle persist for another 27 months, or just under two and a half years, it would be the longest period of “economic growth” in history.

Amazon doubles down on Prime video push in India with Lionsgate deal

Amazon is doubling down on its bet to to grow its streaming business in India, announcing on Friday a long-term exclusive deal that will bring Lionsgate’s top films to its Prime video service in the country.

While the terms of the deal were not disclosed, the partnership with Lionsgate will bring Oscar winning films like La La Land and other titles like Deepwater Horizon to Indian viewers. Moreover, these movies will not be available on satellite or cable television.

Jeff Bezos’ ecommerce site is betting big on growth in India and first launched its video streaming service in the world’s second most populous country in December. It is also working on the production of an original Indian series. On its most recent earnings call, chief financial officer Brian Olsavsky said that India “continues to be a rather large investment for us” and “we’re bullish on India longer-term and it’s early”.

Japan’s pension fund buoyed by Trump rally

The world’s largest pension fund delivered a return of 7.98 per cent in the final quarter of 2016 as the Trump rally sent global asset prices soaring in yen terms.

Japan’s Government Pension Investment Fund, which manages public pension money for millions of workers, returned ¥10.5tn ($91.9bn) during the quarter. Its value rose to ¥144.8tn ($1,268.5bn).

The surge in value helps to validate Japanese prime minister Shinzo Abe’s 2014 decision to shift the GPIF into risky assets, including foreign equities, and gives him another reason to thank new US president Donald Trump.

The GPIF made 15.2 per cent in the quarter on its holdings of domestic equities, slightly ahead of a 15 per cent rise in the Topix index, and 16.5 per cent on its portfolio of foreign stocks. Foreign bond holdings returned 8.8 per cent, reflecting the yen’s fall, while domestic bonds lost 1.1 per cent.

After three quarters of its fiscal year, which runs to the end of March, the GPIF was up 5.7 per cent. That follows a 3.9 per cent fall the previous year.

$74 Trillion Global Economy

Fascinating depiction of the global economy, broken down by geographic region. Each country’s is sized according to their percentage of global GDP output. (GDP data is via the World Bank, effective February 2017).

South America is much smaller than I expected, as is China (still). Amazing that US is about the same size of Europe.

Growth in Wealth from 1975 to 2002

Two thirds of the territories in the world have experienced a growth in their wealth from 1975 to 2002. The biggest absolute wealth increase has been in China. Eastern Asia has experienced the largest proportional increases in wealth, averaging a growth in Gross Domestic Product (GDP) of 8% a year.

Unfortunately those territories with the smallest GDPs have, at best, only experienced a very small proportion of worldwide increases in wealth. Although distributions of wealth do change, the map shows wealth growth in places that are already relatively wealthy. The territories with the largest increases in GDP, when taking local prices into account, were China, the United States, Japan, India and Germany.

Source: Worldmapper

Islam Will Surpass Christianity To Become The World’s Largest Religion, New Report Says

If current trends continue, Islam is on track to become the largest religion in the entire world by the end of this century according a stunning new report that was just released by the Pew Research Center.

While it is true that Christianity is still growing on a global basis, it is not growing nearly as rapidly as Islam. So unless something changes, Christianity will only be the second largest faith in the world by the year 2070. According to this newly released report, Islam is the only major religion that is growing faster than the global population overall, and it is being projected that the number of Muslims on the planet will rise by a staggering 73 percent between 2010 and 2050

Islam is the only religion growing faster than the world’s population, and it will be the largest in the world by 2070, research has found.

US-based Pew Research Center analyzed demographic change among the world’s major religions and found that the world’s population of Muslims will grow by 73 percent between 2010 and 2050, compared to 35 percent for Christians, the next fastest-growing faith.

The world’s population will grow by 37 percent over the same period. If those rates of growth continue past 2050, Muslims will outnumber Christians by 2070, the report found.

Alibaba to invest $177m in India’s Paytm

Alibaba has agreed to invest $177m in the online retail unit of Indian tech group Paytm, giving the Chinese tech group a controlling stake in one of India’s major ecommerce businesses.

The Chinese tech conglomerate is leading an investment round of $200m into Paytm Ecommerce, at a valuation of around $1bn, Paytm said on Friday. The ecommerce business was spun out as a separate entity last year by Paytm, best known for running India’s most popular digital payments platform and which is also poised to set up a quasi-bank later this year.

Alibaba and its affiliate Ant Financial had previously built up a 40 per cent stake in Paytm through investments including a $680m injection in 2015. Their combined stakes in Paytm Ecommerce will now account for the majority of its stock.

Despite Alibaba’s backing, sales on Paytm’s ecommerce platform lag far behind those on market leaders Flipkart and Amazon India, analysts say.