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Become a Better Investor Newsletter – 5 November 2022

Noteworthy this week

  • Fed hiked 0.75% as expected by the market
  • Central banks have been loading up on gold
  • Biden disincentivizes energy investments
  • Hundreds of new mines are needed to meet battery demand
  • We could see an OPEC-style cartel for battery metals

Fed hiked 0.75% as expected by the market: JPow announced another 0.75% hike, and the Bank of England followed suit a few days later. Central banks are going to break things.

Central banks have been loading up on gold: Central banks bought a record amount of gold in 3Q22, the highest since 1967. Not all share their purchases and holdings regularly, though, e.g., big ones like China and Russia.

Biden disincentivizes energy investments: Biden wants to put an extra tax on energy producers, disincentivizing investments, which could lead to higher oil prices.

Hundreds of new mines are needed to meet battery demand: Millions of tons of lithium, cobalt, nickel, and graphite are needed to meet future battery. Is the green revolution that green?

We could see an OPEC-style cartel for battery metals: Indonesia, which is the world’s largest nickel producer, is looking into forming a cartel for battery metals like nickel, cobalt, and manganese. These metals are in high demand due to the “green transition.”

Poll of the week

Vote on LinkedIn or

Results from last week’s poll

The skewed results show that the politicalness of Musk means that you either love it or leave it

Since Musk took Twitter private, I should have said, “Where do you think Twitter’s share price will be in 12-24 months from now when Musk relists it on the stock market?”

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The Valuation Master Class Boot Camp is a 6-week intensive company valuation boot camp for a successful career in finance.

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Weekly market performance

Click here to see more markets and periods.

Chart of the week

Discussed in the Become a Better Investor Community this week

The FOMC meeting is tomorrow, what do you think @channel?

  • Unchanged
  • 5% hike
  • 75% hike (priced in)
  • >0.75% hike

“I think either 3-4 (leaning towards 4)…my hypothesis is reflected from the high mortgage rates (7%) and inflation.”

“I think 3”

“I am thinking J Pow hits us with a very unpopular 100bps. ( I have been wrong on the last 2 votes though 😀 )”

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Podcasts we listened to this week

MacroVoices #347 Ole Hansen: Commodities Can Go Up Even In Recession

Erik and Ole discuss:

  • Fed’s policy and inflation
  • Lack of investments, decarbonization and electrification
  • Perspectives on US dollar
  • Will inflation persist during a recession?
  • Copper, gold and agriculture

Readings this week

Summary of Momentum: what do we know 30 years after Jegadeesh and Titman’s seminal paper? By Tobias Wiest.

Read the summary here.

Book recommendation

Money: The True Story of a Made-Up Thing by Jacob Goldstein

Fantastic overview of the history of money and what it is.

Audible or Kindle.

Audible is great; have you tried it? If not, click here to get 2 books for free.

Memes of the week

New My Worst Investment Ever episodes

Ep614: Cam F Awesome – Don’t Stop Chasing You’re Dream

BIO: Cam F Awesome is a multi-time National Champion Heavyweight Olympic boxer and former USA National Boxing Team Captain.

STORY: Cam invested so much time and effort chasing his dream of going to the Olympics. An avalanche of events stole this dream from him, and now he doesn’t stand a chance of ever going to the Olympics.

LEARNING: There are ups and downs in investing. Persevere and be willing to pivot.

Ep613: Dudu Cearense – It’s Your Responsibility to Take Care of Your Money and Wealth

BIO: Dudu Cearense is an ex-soccer player, financial adviser, and private banker.

STORY: Dudu’s worst investment ever was not learning about managing his money when he was a successful soccer player.

LEARNING: Invest in learning about money management.

Ep612: Kim Barrett – Check Your Capacity Before You Hire

BIO: Kim Barrett is a world-renowned million-dollar marketing strategist with a focus on Facebook. Kim is an international speaker and trainer, having taught marketing worldwide and helping businesses grow to six, seven, and even eight figures.

STORY: Kim had a successful start to his business. He was bringing in lots of sales, and he felt he needed more staff to handle these sales. The problem was that he spent too much on those people without looking at their achievements and his team’s capacity limits.

LEARNING: Have a clear understanding of your business numbers. Dive deep into the capacity that you have before hiring. Avoid a business model that makes it easy to grow costs and hard to increase revenues.

Published on Become a Better Investor this week

Marubeni Corporation (8002 JP): Profitable Growth rank of 3 was up compared to the prior period’s 4th rank. This is above-average performance compared to 1,470 large Industrials companies worldwide.

Read Marubeni – World Class Benchmarking

Sichuan Kelun Pharmaceutical Company Limited (002422 SZ): Profitable Growth rank of 6 was up compared to the prior period’s 7th rank. This is below-average performance compared to 380 large Health Care companies worldwide.

Read Sichuan Kelun Pharmaceutical – World Class Benchmarking

In October 2022, we published 13 new episodes of the My Worst Investment Ever podcast. Listen to all of them here.

Read My Worst Investment Ever October 2022

Fed interest rate hiking cycle sweeping across the world. EM rates have been higher but kept low by China; FMs suffer the most Rate rise reduced global earnings by 6.2%; in DM US and UK hit hardest.

Listen to Your Wealth Engine – 31 October 2022

PT Kalbe Farma Tbk (KLBF IJ): Profitable Growth rank of 2 was up compared to the prior period’s 3rd rank. This is World Class performance compared to 380 large Health Care companies worldwide.

Read Kalbe Farma – World Class Benchmarking

DISCLAIMER: This content is for information purposes only. It is not intended to be investment advice. Readers should not consider statements made by the author(s) as formal recommendations and should consult their financial advisor before making any investment decisions. While the information provided is believed to be accurate, it may include errors or inaccuracies. The author(s) cannot be held liable for any actions taken as a result of reading this article.