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Match Group Beats Estimates as Tinder Popularity Grows Abroad

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Comments of the Day

09 May 2019

 

 

Video commentary for May 8th 2019

 

 

Eoin Treacy's view

A link to today's video is posted in the Subscriber's Area. 

Some of the topics discussed include: Wall Street pauses, Dollar weakens against the Real and Rand, China banks weak, natural gas, coffee deeply oversold, Velocity of money turned up ahead of the Fed reducing the size of its balance sheet. treasuries and gold fail to hold intraday rallies. 

 

 

Email of the day on global liquidity addiction:

 

 

Eoin Treacy's view

I concur to Iain's comments, you are on something. Liquidity has to go somewhere, and it is evident that liquidity went to financial and some hard assets (2-3 months ago I read an article saying that Whiskey had been the best performing hard asset with 582% gain over the past 10 years - 48% in 2018 alone!). 

This extensive email continues in the Subscriber's Area. 

Thank you for this detailed account of the global macro environment. We have long characterised this bull market as liquidity fuelled and that is as true today as it was back in 2009. The clearest conclusion therefore is that we have to be alert to the liquidity environment because the asset price inflation which has been the primary contributor to this bull market is dependent on it. In other words, markets are addicted to liquidity and like any addict, withdrawal would be painful.

 

 

Why cheap coffee means more migrants at the border

This article by Paul Hicks and Dan McQuillan for the Houston Chronicle may be of interest to subscribers. Here is a section:

In recent years, their challenges have increased. Climate change stretches the dry season, or makes rainfall erratic. Last year some farms went up to 45 days without rain. The farmers watched their maize and bean plants wilt and die. Then they reaped only more debt from their meager coffee harvest.

 

Eoin Treacy's view

In normal circumstances when the price of a commodity drops below economic production levels supply dwindles. That eventually contributes to recovery.

 

 

China Defaults Hit Record in 2018. 2019 Pace Is Triple That

This article form Bloomberg News may be of interest to subscribers. Here is a section:

China continues to press banks to extend credit to the private sector, and small and medium-sized companies especially. The latest move came Monday, when the central bank loosened some reserve-requirement rules for lenders. But President Xi Jinping’s team has also focused on shrinking the shadow-banking system, where credit decisions were made with less regulatory oversight and where it was easier to build up unsustainable leverage.

It’s that funding squeeze that explains the default surge that began in late 2017 and continues today. By contrast, 2016 was more a story of China’s push to shrink excess industrial capacity having reverberating effects in credit markets. “Short bond tenors mean the companies need to refinance frequently,” and weaker ones will likely have difficulty, analysts including Hong Kong-based Nino Siu at Moody’s Investors Service wrote in a note last month. “Banks are reluctant to lend to weaker companies. Additionally, shadow banking, on which weaker Chinese companies rely, continues to contract as the government tightens regulation,” she and her colleagues wrote.

 

Eoin Treacy's view

One of the companies listed in the above article is Neoglory. I visited their headquarters in Yiwu about seven years ago. Mrs. Treacy had a tourist focused store at the time and was sourcing costume jewellery. Neoglory was the largest, splashiest company around and was one of our first calls. We never purchased from them because when it came to negotiating prices, they had a complex web of discounts and promotions. When we questioned the accuracy of a salesman’s calculation he said “that’s how I do math”. At that point we walked. That phrase has passed “that’s how I do math” is something we still smile about. It looks like we were not the only ones to walk away from the company.

 

 

Match Group Beats Estimates as Tinder Popularity Grows Abroad

This article by Olivia Carville for Bloomberg may be of interest to subscribers. Here is a section:

Match, which is owned by billionaire Barry Diller’s IAC/InterActiveCorp, runs dozens of dating sites like Tinder, OKCupid, Plenty of Fish and Hinge. But the bulk of the company’s earnings gains were fueled by Tinder, which lured in more than 384,000 new subscribers in the quarter, boosting direct revenue 38 percent from the year earlier period.

The online dating app, where users swipe right to indicate interest in a potential date, now boasts 4.7 million global subscribers. Overall, Match’s average subscribers increased 16 percent with most of the new users flowing in from outside North America.

“The world is changing," said Mandy Ginsberg, chief executive officer of Match. “I’ve been here a long time and 100 percent of the revenue used to be in the U.S. and now the growth and more revenue is outside of the U.S."

With arranged marriages on the decline in India and the stigma towards online dating eroding in Japan, Ginsberg is concentrating on international expansion. There are more than 400 million single people living outside North America and Europe, two-thirds of whom have not yet tried a dating product, according to Match. Ginsberg recently revamped the company’s leadership team in Asia -- appointing general managers in Tokyo, Seoul and Delhi -- to try and grow Match’s footprint across the continent.

 

Eoin Treacy's view

Economic growth in India and the subtle shift towards female empowerment represent major growth opportunities for social media and online dating companies. Narendra Modi’s election five years ago as the first low caste Prime Minister represented a signal that social striation enshrined by the caste system and sustained by the system of arranged marriages may be changing. A more open society would represent a significant change for India which has historically been socially conservative.

 

 

2019: The 50th year of The Chart Seminar

 

 

Eoin Treacy's view

I have had word from the inestimable Mrs. Fuller that the London Philharmonic Orchestra are planning a memorial concert on October 5th at the Royal Festival Hall. It is envisaged that there will be drinks and canapes afterwards. Since this is the 50th year of The Chart Seminar we will be conducting the event on October 3rd and 4th.

I also plan on holding a New York event, potentially in June, and am in discussions with a partner in how best to organise it.

In the meantime, if you have any questions, would like to attend, or have a suggestion for another venue please feel to reach out to Sarah at [email protected].  

The full rate for The Chart Seminar is £1799 + VAT. (Please note US, Australian and Asian delegates, as non-EU residents are not liable for VAT). Annual subscribers are offered a discounted rate of £850. Anyone booking more than one place can also avail of the £850 rate for the second and subsequent delegates.

 

 

Eoin's personal portfolio: precious metal long initiated March 8th

 

 

Eoin Treacy's view

Details of this trade are posted in the Subscriber's Area. 

 

 

 

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