Weekend Reads for Global Investors: Oil Economics, Emerging Markets, and Some Lighter Fare

The April issue of the McKinsey Quarterly featured an article aptly titled “Economists: Don’t Leave Home without One.” (Spoiler alert: it is written by an economist.)

The recent rise in oil prices after the sharp plunge earlier in the year seems a particularly interesting case for economists to opine on. For example, where will oil prices go from here? And how will that affect the global economy, markets, and investors’ nest eggs?

Since we highlighted the earth-shattering Saudi-led air strikes in Yemen three weeks ago, their impact is still being felt across the global financial markets. Oil prices have steadily climbed, reaching their highest mark of the year this week. Economists cannot seem to agree on their future direction though, with the International Energy Agency (IEA) vocally expressing its concerns over demand and hence price outlook.

How the global economy will perform given a drop in oil prices from previous highs is not certain either. While many hope that lower energy costs will boost corporate profits, which seems like basic Economics 101, economists at The Conference Board believe that the “Economic Benefit from Oil Profits [is] Already Played Out.”

It sure sounds like you can’t leave home with just one economist — everywhere you turn there seems to be at least two different economic perspectives. So take your time and decide which one makes more sense to you.

Fortunately, it has been mostly a quiet week, so there aren’t that many more conflicting economic views to bang our heads over. Have a great weekend, and I hope you enjoy some of the other interesting reads I have come across in recent weeks, including insights from such investment luminaries as Burton G. Malkiel.

Oil Economics

• “Oil Prices Jump on Inventory Data, Demand Outlook” (Wall Street Journal)
• “IEA Warns of ‘Murkier’ Oil Outlook” (Financial Times)
• “Economic Benefit from Oil Profits Already Played Out” (Wall Street Journal)
• “Economists: Don’t Leave Home without One” (McKinsey Quarterly)
  
• “Secular Stagnation: The Long View” (Economist’s View)

Investing 

• Geographical labels on indices are increasingly less relevant: “EDHEC: Geography Is Not Just a Listing or Headquarters” (AllAboutAlpha.com)
• A critical question that does not get asked often enough: “Should You Be Mostly Cash Like Mohamed El-Erian?” (Pragmatic Capitalism)
• “Fossil Fuel-Free Funds Outperformed Conventional Ones, Analysis Shows” (The Guardian)
• “I Wish I Started to Save Earlier after Seeing This Chart” (Lifehack)
• “Trading Is Still Hazardous to Your Wealth” (Finance Magnates)

Emerging Markets

• Burton G. Malkiel on “How Much Should We Invest in Emerging Markets?” (Wealthfront)
• “Rajan Urges Emerging Markets to Overhaul Global Economic Rules” (Bloomberg)
• Check out which emerging markets will emerge — at least in terms of the scale of their economies: “These Will Be the World’s 20 Largest Economies in 2030” (Bloomberg)
• “Why Are Businesses Shifting Focus to Emerging Markets?” (Huffington Post)

The Environment

• Check out this summary on the impact of pollution. (Huffington Post)
• “How Can China Reduce Its Coal Consumption?” (World Economic Forum)
• A vivid one-minute video: “High Levels of Air Pollution Hit London and Other Parts of England” (Euronews)
• “Air Pollution May Be Damaging Children’s Brains — Before They Are Even Born” (Ecologist)
• “How Does Air Pollution Affect Pets?” (SFGate)

The Soft Side of Business

• Public speaking is frequently cited as people’s number 1 fear, even without anyone from the audience asking rambling questions. A veteran explains how to respond in such situations: “What to Do When Your Audience Asks Rambling Questions” (Forbes)
• “Why the Best Salespeople Get So Lucky” (Harvard Business Review)
• Entrepreneurs not only have to be visionary in building a new business, they also need to be good at managing people: “It’s Inevitable — How to Have Tough Conversations with Your Employees” (Forbes)

And Now for Some Reading Truly for the Weekend . . . 

• At least you can now justify to your better half why you had to get that expensive watch: “Wearing Luxury Brands Makes You Seem More Qualified for the Job” (Harvard Business Review)
• “Kind Bars Are Not ‘Healthy’ Says the FDA” (CNBC)
• “The Seductive Way Sichuan Cuisine Is Captivating America“(Huffington Post)

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All posts are the opinion of the author. As such, they should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute or the author’s employer.

Image credit: ©iStockphoto.com/Christian Mueller