Transcript EUTIC – Valuation & Business Modelling

EUTIC Weekly Meeting!
Week 5
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9th February 2015
Coming up tonight
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Introduction – Jon (President)
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The Week That Was – Tory (Head of CR)
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Fund Update
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How to solve complex problems & our behaviour – Jon (President)
http://vimeo.com/31663377
Events coming up
– Social events
– More ways to get involved before the AGM
– EUTIC Trading Game – sign up if you haven’t already!
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July 7, 2015
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The Week That Was
February 9th, 2015
Tory Clemente
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Big themes
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Ukrainian Crisis
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Greek Debt Disaster
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US Job Report
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What’s the deal with
the Middle Class?
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Ukrainian Crisis…Talks lead to more Talks
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Lets use our words, not our fists
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US calls for military support of
Kyiv – especially Joe Biden?
NATO speaks up too.
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Angela Merkel’s in the spotlight
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BUT Russia is NOT helping!
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Merkel to meet Obama
Source: FT
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Ukrainian Financial Meltdown
•
The Ukrainian Hryvia
plummeted 30 percent
against the dollar after the
Ukrainian Central Bank
decided to stop propping its
currency.
•
Key interest rate rose from
14 percent to 19.5 percent!
• Lots of pressure on the IMF, but its already loaned
Economy expected to
contract
4 to 5 percent this year.
Ukraine
$17bn
Source: FT, Bloomberg
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Greek Debt Disaster
Waiver Revoked!
Source: FT
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Greek Debt Disaster
Greek Banks will have to find other forms of collateral, but
apparently they were pretty much at that point already.
This is a clear warning to Greece for them to make a deal, and fast.
•
•
•
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Renzi and Hollande support a deal, but they are toeing the line.
Euro and US Stock markets fell on Wednesday with the surprise but
quickly rebounded.
Source: FT, Independent
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US Job Report
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257,000 jobs added in
January! Very good sign of
recovery.
Unemployment actually rose
in January to 5.7 percent,
but this signals that more
people are actually joining
the labour market.
Source: FT
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US Job Report
The US Dollar Surged against the Euro and the Yen on Friday.
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Is this a good thing?
Imports grew in December while exports fell, which some are saying
is to blame for the US’ less than expected growth in the last quarter
of 2014.
Source: FT, TradingEconomics, Bloomberg
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US Job Report
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When is the Fed going to raise its
rates?!
– June 2015?
Fed changed its assessment of the
US Labour market from “Solid” to
“Strong”
Federal Open Market Committee is
set to meet in March
Yellen to testify to Congress later
this month.
Source: FT
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…Tory’s version of Seok’s Slides
Hare-ish view
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Surging US Dollar hurts
exports and increases
imports.
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“Jethro” Tull-ish view
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Falling oil prices helping to
drive economy.
Counterintuitive when you’re
trying to increase jobs in
your economy.
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Economy seen as growing
enough to handle rate
increase.
•
Calls for Obama to take
stronger stance against
currency manipulation in
other countries.
•
Wages finally rising after
falling in December, should
help push the economy in the
right direction.
•
Adding jobs to the economy,
but are “real” wages rising
enough?
•
More Americans are looking
for work!
Disclaimer: Market outlooks are personal views
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What’s the deal with the Middle Class?
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What is “The Middle Class”
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Karl Marx
– The owners of the “means of
production,” but generally worked
it themselves.
– Constant internal struggle
between those of the working
class and those at the top.
Investopedia
– Homeowner
– Car owner
– College Education for Kids
– Retirement Security
– Healthcare Coverage
– Family Vacation
Granted…none of that really matters
when you look at this
Source: WSJ, Investopedia
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What the Middle Class is not….
Working Class
Upper Class
Middle Class
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Why do they matter?
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Economic
– Joseph Schumpeter saw the
middle class as drivers of
“Creative Destruction”
– Many Middle Class families
encourage their children to get an
education and give them an
economic “sense of entitlement” Annette Lareau
Political
– Obama used the term “Middle
Class” seven times in his most
recent State of the Union
Address, and has been pushing
for “Middle Class Economics”
– 45% of US population, 43% of
UK population. MAJOR VOTING
BLOCK.
Source: Whitehouse.Gov
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What’s Changed?
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The Real Wage Story
– QE in the US and the UK raised
the prices of financial assets
(stock markets and bond
markets have made huge
rebounds), but bit into the real
wages of workers.
– Economies continue to add
jobs, but wages have either
fallen or remained stagnant.
Expectations
– Billionaire Jeff Greene says that
the middle class expectations
are not aligned to their income
reality.
Globalisation and Regulation
– Harvard Economist, Michael
Porter, blames red tape, and
loss of skilled work.
Source: Pewresearch, FT, Economist, CNBC, DailyKos
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The Outlook
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The Buffet Rule
– A minimum tax rate of 30 percent on
those bringing home more than 1
million dollars every year.
Middle Class Economics-Obama
– Higher Capital Gains tax on highest
earners
– Closing loophole around capital gains
– New levy on big banks
Maybe things are looking up
– Wages up 22 cents in January.
– Minimum wage rising in the States
– Wage growth surpassed inflation in
November in the UK.
– BUT Real wages continue to fall in
the Eurozone
Source: FT, Economist
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Questions
Questions?
Email:[email protected]
Or meet me at the pub afterwards!
** All sources for charts and data can be found under the notes of this presentation**
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Fund Update
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Fund Breakdown
1.44%
-8.24%
7.80%
-21.48%
5.32%
11.27%
-10.19%
5.37%
£6,000.00
£5,000.00
#REF!
WTB.L
JUP.L
TPFB
HAYT.L
BCN.L
£4,000.00
SDP.L
PMP.L
GBG.L
CSRT.L
ABG.L
IHG.L
£3,000.00
SND.L
HIK.L
UU.L
BT-A.L
PHP.L
EZJ.L
Cash
Cash
£2,000.00
Cash
Cash
Cash
Cash
Cash
Cash
£1,000.00
£0.00
ALT
BM
CON
ENE
FIN
HEA
IND
TMT
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Sector Performance
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Fund Performance
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COMPLEX PROBLEM
SOLVING –
How to act and make
choices
Jonathan Dale
[email protected]
Sponsored by
Sponsored by
Thomas Thwaites, http://www.thetoasterproject.org
Sponsored by
Sponsored by
Sponsored by
Sponsored by
Sponsored by
Sponsored by
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NUMBER OF DISTINCT PRODUCTS
In a hunter-gather society 300
Served by Starbucks
85,000
In a supermarket
100,000
In London
10,000,000,000
Sponsored by
Source: Starbucks; Eric Beinhocker, McKinsey Global Institute
WORLD’S LARGEST COMPANIES,
1912
Sponsored by
1.
US Steel
6. Anaconda
2.
Jersey Standard
7. General Electric
3.
J&P Coats
8. Singer
4.
Pullman
9. American Tobacco
5.
Royal Dutch Shell
10.Internat. Harvester
LARGE FIRM EXTINCTIONS
Number of firms becoming extinct
WHEN THE WORLD’S LARGEST 100 COMPANIES IN
1912 DIED
5
4
3
2
1
0
Sponsored by
1912
1945
1968
1995
SMALL FIRM EXTINCTIONS
PERCENTAGE OF US FIRMS DYING EACH YEAR
BY INDUSTRY & STATE
Percent
60
40
20
0
0
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1000
2000
3000
4000
Observations by 9 industrial sectors, 9 years, 50 states
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Ways to get involved this semester
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Join a sector and PITCH STOCKS
Join our new trading game
– See Facebook for info
Attend main meetings
Apply for insights, internships & grad jobs through EUTIC. It’s never too late!
– www.eutic.org
– Job openings page
Committee roles
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Company Relations – Upcoming events
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PwC
– Crowdsourcing Competition
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BlackRock
– Office insight day
2nd February
2nd March
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Post-Meeting Drinks
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(Notes for Jon: Use Wit, charm and humor to wow the audience and entice them to come
and socialise, you may not live up to Jamie’s standard of presenting but as your mum
always told you it’s okay as long as you try your best.)
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The Potting Shed, space reserved for EUTIC
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Head over after main meeting
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Come meet everyone, great opportunity to talk to
committee if you’re thinking of running for a position at the
AGM
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