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Global markets started the week higher. Oil prices where at their highest since the beginning of the pandemic with U.S. crude hitting $73.46 per barrel. Oil prices continued their move upward this week, after rising last week on the back of bullish demand reports by both OPEC (Organization of the Petroleum Exporting Countries) and the International Energy Agency (IEA). According to OPEC, global oil demand will rise by 6 million barrels per day this year from the lows of 2020, led by strong consumption in China and the United States, especially in the second half[...] Allocation is crucial in investing. It is described as an amount or portion of a resource assigned to a particular recipient. One can allocate based on type of security (asset), market value size, credit rating, and geography. These may be for mere diversification purposes or to try to capture growth. China has been coming up a lot lately as one of the best geographical allocations to capture growth. China went from a closed communist economy to become the 2ndMore Bitcoin, although the best performing asset class this year, entered into a free fall this week bringing other cryptocurrencies along with it. The coin began to retract last week when Elon Musk, the CEO of Tesla, tweeted (posted on social media) that Tesla will not be accepting Bitcoin as a payment method anymore. The price later stabilized when Musk tweeted that Tesla will not be selling its $1.5 billion stake in Bitcoin. Bitcoin went into another free fall this week as another tweet of Musk implied the opposite. On top of that the People’s Bank of China also ruled out cryptocurrencies as a method of payment. China is[...] Following last week’s news on the Colonial Pipeline, everything is back to normal which led to oil prices retracting. Gold prices on the other hand are on the rise recently hitting a 3-month high. As you could have seen from your portfolio highlights, asset classes such as stocks (more so value stocks), commodities, oil, and Bitcoin are among the best performers so far this year. Among the worst performers are investment grade bonds, government bonds, and gold. Do not be shocked if this trend continues through the end of the year. The U.S. has been spending freely this past year in order to stimulate their economy. The big question for many became, how will all of this be funded? There were rumors that it would be funded through increased corporate and capital gains taxes which was later confirmed in President Biden’s latest plans. In the first instance we might think that increased corporate taxes would be bad for the companies we own. According to Finance Professor Aswath Damodaran, this is not necessarily the case. There are more factors that should be considered. For instance, a higher corporate tax rate can give companies the opportunity to report less income taxable income[...]
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