Warren Buffett And The Chinese Are Loading Up On Hard Assets

The Internet Of Small Things Spurs Big Business

 

IoT scenarios that appear consumer-centric and disposable hold broad business opportunities.

In a recent InformationWeek column I opined that smart sensors would soon find their way into many disposable products -- like a soda can, which when opened triggers a contest. Initially these won't be very sophisticated, but as sensor prices fall and technologies improve, extreme connectedness across the Internet of Things will inspire new business opportunities.

 

One example is start-up LIFX, based in Melbourne Australia, which has raised $12 million in series-A venture capital funding, for guess what? A lightbulb. Not your standard bulb, but rather a WiFi-enabled, multi-colored, energy-efficient LED smart bulb controlled from a smartphone app.

 

Big deal you might say -- just another gimmicky case of IoT presented in a niche consumer context but with no place in big business, right?

 

Wrong.

 

If the humble light bulb can be managed from a mobile app to control energy output, color, and ambience in the home, then why not apply the same smarts in a commercial setting. Imagine controlling retail store lighting from the touch of an app or changing hue to accentuate products. Want a holiday mood theme for the store or restaurant? Just tap the app -- a simple, cost-efficient way to differentiate your products from something that's pretty much been the same since Edison stumbled upon the light bulb idea.

Beyond light bulbs, we're seeing other IoT applications that appear consumer-centric but have broad business implications. Consider the Nest Labs home thermostat. Nest has no doubt made a tidy sum selling its smart device (40,000 to 50,000 units per month, according to reports), but there are bigger forces at play. It's really more about very smart business than smart technology.

 

An Austin, Texas-based utility company is working with Nest to manage power demand by remotely turning down air conditioning (AC) systems at peak times. On hot days, AC accounts for half of Texas's energy usage and drives up wholesale energy costs. So any mechanism that conserves power is good business. It's also great for the consumer too, with customers offered energy rebates if they allow the company to dial-back AC usage using Nest.

 

Business models like this rely on Internet of Things smarts, but the real value comes because customers buy into an intelligent application and service. Nest, for example, gathers data from sensors (temperature, humidity, and light) together with behavioral consumer analytics that learn residential habits in order to program AC settings automatically. Add the ability to combine weather data and a mobile app and Web portal to control the system and everyone stays cool -- physically, environmentally, and financially.

 

What's apparent from both the LIFX and Nest examples is that applications and services are the real powers behind the Internet of Things. Sensors gather the data (lots of it), but analytics and mobile apps are the secret sauce.

 

Developing these types of apps and services will require smart thinking from technical teams. New business model opportunities will put pressure on development teams to deliver cool new apps to consumers rapidly. But new features will become almost as disposable as the physical products themselves. As such, teams will be continuously adding, testing, refining, and removing functionality to address immediate opportunities, but with the flexibility to pivot when business models change.

 

As IoT makes the consumer-to-commercial crossover, key data acquisition and storage challenges will also need to be reviewed. As yet, smart systems and sensor networks can't process massive amounts of data at the point of capture -- meaning cloud becomes the offload point and intermediary for big data and analytical applications. For businesses, this means addressing persistent cloud security issues and building high-performance networks needed to support a much more diverse set of applications.

 

Apps of course will change too. Today, the smartphone is the focal point for control in many Internet of Things use-cases. But as standards emerge and technologies improve, more intelligence and control will be incorporated within the actual smart-sensor networks themselves.

 

Thinking back to light bulbs, I'm not quite ready to fork out $100 for something I see as disposable, but as a pseudo geek I probably have too much emotional investment in the tech wizardry to throw one away.

 

However, as prices fall and smarts improve, the act of discarding something with more compute power than the Apollo spacecraft will become commonplace. But before things are sent to the scrap pile, smart businesses will have leveraged a new generation of applications to extract every last drop of business value from the IoT tech.

http://www.informationweek.com/strategic-cio/executive-insights-and-innovation/the-internet-of-small-things-spurs-big-business/a/d-id/1279141?_mc=sm_iwk_editor_shaneoneill

Half a cheer for depression's end

 

 

On Friday we will have - depending on how you look at it - either the most symbolically important or the most pointless economic event of recent times.

Namely, official confirmation that the depression caused by the mother of all banking and financial crises is finally over. UK output or GDP has finally exceeded its pre-recession peak (the technical definition of a depression is the period during which GDP remains below that peak).

On the official government stats, GDP fell by 7.2% between its peak in the first quarter of 2008 and its trough in the second quarter of 2009.

Since then recovery has been unusually - some would say lamentably - slow, and national output in the first three months of this year was still 0.6% below that peak.

But that recovery has been picking up considerable momentum over the past year. The UK is now the fastest growing economy of all the world's rich ones.

So in the quarter to the end of June, quarter-on-quarter growth is bound to have been more than 0.6%. The respected National Institute for Economic and Social Research predicts growth of 0.9% in that period.

Which means - hooray hooray hooray - that the depression is officially over, and that we are now once again earning more than we did before the banks got us into our pretty pickle by starving us of credit.

All of which is terribly exciting. And we can expect the Tory chancellor, George Osborne, and his Lib Dem treasury chief secretary, Danny Alexander, to shout from the rooftops that this economic renaissance is all down to their sagacity and tough actions.

Except, as is usually the way with blinkin' economic statistics, it isn't quite as straightforward as that.

For one thing, the Office for National Statistics is in the process of reworking how it calculates GDP. And it has already admitted that the number I gave you above, about how far output fell from its peak between 2008 and 2009, is wrong.

The current officially recorded contraction of GDP exaggerates, a bit, the magnitude of the decline in output. Which implies that the previous peak for output was almost certainly surpassed some time ago - so long, that is, as there aren't significant offsetting revisions to subsequent growth.

Chances are, however, that this terrible depression actually ended some while ago, probably last year. Fingers crossed we will know more about this - I won't say the truth of it (nebulous concept in economics) - in September.

So on Friday we will basically be doing the equivalent of celebrating a World Cup victory that may or may not have actually happened some months earlier.

This could only happen in the wonderful world of economics.

Which brings me to my second and third reasons why you may not need to put out the "Britain is booming again" bunting on Friday.

For one thing, the industrial experience of the past few years has been variegated.

So we are certain that the service industries, which dominate our economy, are already producing more than they did before the great crash, whereas manufacturing is still generating considerably less - 7.6% less in the first quarter of this year, on those questionable official figures.

The vaunted rebalancing of the economy between intangible services and tangible making has not remotely happened - and probably never will.

Perhaps more importantly, it is very unlikely that you personally - yes, I am talking to you - feel any richer than you did at the beginning of 2008.

Because whichever way you cut it, most people remain poorer, largely because the population has increased considerably faster than output has recovered.

 

How much poorer?

Well the acknowledged brainboxes on this are the Institute for Fiscal Studies.

And they say that a year ago real median income - that is adjusted for the impact of inflation - was still 5.8% below its peak for a typical individual (the median calculation) or 8.5% lower on average (the mean assessment).

There are various other ways of cutting these figures, according to which measure of inflation is used or whether housing costs are incorporated.

But the relevant point is that living standards for most British people haven't yet recovered to their pre-crisis levels - and probably won't for two or three years yet.

 

http://www.bbc.co.uk/news/business-28417993

Young hit hardest by recession, says IFS

Young people were hit far harder by the recession than older generations, a report has found.

People aged 22-30 saw their household incomes fall by 13% between 2007 and 2013, while those between 31 and 59 saw a 7% drop, according to the Institute of Fiscal Studies (IFS).

Employment prospects for the under-30s were also hit harder.

Living standards are set to be a key issue in the run-up to next year's general election.

While the government has focused on the economic recovery, the opposition Labour party says living standards have yet to improve for too many people.

 

'Hardest hit'

 

The IFS report, based on government figures part funded by the Joseph Rowntree Foundation, also found that the employment rate among 22-30 year olds over the period fell by 4%, while that among 31-59 year olds remained stable.

The over 60s saw almost no impact on either houshold incomes or employment rate.

"Pay, employment and incomes have all been hit hardest for those in their 20s," said Jonathan Cribb, research economist at the IFS.

"A crucial question is whether this difficult start will do lasting damage to their employment and earnings prospects."

The report also concluded that was "no clear North-South divide" in the impact of the recession. It also noted that home ownership among the young had fallen sharply in recent decades.

Only 21% of people born in the 1980s had bought their own house by the age of 25, compared with 34% of those born in the 70s and 45% of those born in the 60s.

The Treasury said the report showed "just how hard Labour's great recession hit young people and why it's vital we keep working through our long-term economic plan to cut the deficit, create jobs and equip people with the skills they need for the future".

Labour Treasury spokeswoman Catherine McKinnell said: "While David Cameron denies there is a cost of living crisis, these figures show people have seen a substantial fall in their incomes since 2010".

http://www.bbc.co.uk/news/business-28305804 

Robert Prechter on the Bullishness of an EU Breakup and the coming Global Deflation

FTSE rebounds, Shire hits record

 

A man walks past the London Stock Exchange in the City of London October 11, 2013.

Credit: Reuters/Stefan Wermuth

LONDON (Reuters) - UK shares bounced back on Monday after hefty falls last week, with drugmaker Shire hitting an all-time high on a bid offer from U.S. firm AbbVie.
 Shire said it was ready to recommend a new offer from AbbVie, which returned with a fifth bid valuing the London-listed drugmaker at 31.3 billion pounds.

AbbVie, which wants to buy Shire to cut its tax bill and diversify its product line-up, made the offer of 53.20 pounds per share on Sunday after the Dublin-based group asked for an improvement on the previous 51.15-pound-per-share offer.

But traders were cautious.

"What we're doing this morning is basically closing down per client half of the exposure, so we're banking something good on the bounce and leaving the other half on just in case (it climbs to 53)," Galvan's head of trading, Ed Woolfitt, said.

Shire shares rose 2.6 percent to 4,998 pence, with trading volume at 90 percent of its 90-day daily average after about an hour's trade, against the FTSE 100 index on just 6 percent.

The FTSE 100, which dropped 2.6 percent last week to post its biggest weekly drop since March, had climbed 52.13 points, or 0.8 percent, to 6,742.30 points by 0918 BST.

Investors put aside concerns about euro zone banks and looked ahead to corporate earnings, traders said.
"Corporate earnings have started to trend to the upside and momentum indicators suggest we are going to continue to see forward-looking estimates improve alongside EPS estimates," Guardian Stockbrokers' director of trading, Atif Latif, said.

Solid gains were also seen from sports retailer Sports Direct, up 4.4 percent, after it announced plans to launch in Australia and New Zealand by forming a partnership with MySale Group. MySale rose 4.8 percent.

Elsewhere among the risers, Rolls-Royce tacked on 1.4 percent as European planemaker Airbus kicked off the Farnborough Airshow with confirmation it would sell revamped versions of its A330 wide-body jet powered by Rolls-Royce Trent 7000 engines.

http://uk.reuters.com/article/2014/07/14/uk-markets-britain-stocks-idUKKBN0FE0SG20140714

Five Things Rich People Know That You Don’t

California governor signs bill to bring bitcoin and other currency into fold

 

California Governor Jerry Brown announces emergency drought legislation at the CalO ES State Operations Center in Mather, California, February 19, 2014.

Credit: Reuters/Max Whittaker

 

LOS ANGELES (Reuters) - California Governor Jerry Brown on Saturday signed into law a bill that clears away possible state-level obstacles to alternative currencies such as bitcoin.

The legislation repeals what backers said was an outdated California law prohibiting commerce using anything but U.S. currency.

Democratic Assemblyman Roger Dickinson, the bill's author, said earlier this week the bill reflects the popularity of forms of payment already in use in California like bitcoin and that even rewards points from businesses, such as Starbucks Stars, could technically be considered illegal without an update to currency law in the nation's most populous state.

California lawmakers approved the measure on Monday, just days after the failed Tokyo-based bitcoin exchange Mt. Gox received court approval to begin bankruptcy proceedings in the United States as it awaits approval of a settlement with U.S. customers and a sale of its business.

Mt. Gox was once the world's leading exchange for trading the digital currency, but shut its website earlier this year after saying that in a hacking attack it lost some 850,000 bitcoins, worth more than $500 million at current prices. The firm later said it found 200,000 bitcoins.

Brown, a Democrat, in his office's written announcement did not comment on the currency bill he had signed into law along with other legislation.

An analysis of the bill prepared for lawmakers mentions "community currencies", which are created by members of a local area along with participating merchants and are sometimes designed as a protest of U.S. monetary policies, among the forms of alternative payment methods now in use in certain parts of the United States.

The U.S. Marshals Service on Friday auctioned off about 30,000 bitcoins seized during a raid on Silk Road, an Internet black-market bazaar where authorities say illegal drugs and other goods could be bought.

 

http://www.reuters.com/article/2014/06/29/us-usa-california-bitcoin-idUSKBN0F402T20140629

Neil Woodford: my 10 favourite shares

Renowned investor reveals top 10 holdings in his new Woodford Equity Income fund 

 

Neil Woodford's new Woodford Equity Income fund has large holdings in AstraZeneca and GlaxoSmithKline, the drugs makers Photo: Jeff Gilbert

Neil Woodford, Britain's most celebrated fund manager, has announced the top 10 holdings in his new fund, the Woodford Equity Income fund.

The £1.6bn portfolio contains many names familiar to investors in the funds he used to manage at Invesco Perpetual, such as AstraZeneca, which accounts of 8.3pc of the new fund, GlaxoSmithKline (7.1pc of the fund) and British American Tobacco (6.2pc).

Two other tobacco companies, Imperial Tobacco and Reynolds American, also make the top 10, as well as a third drugs maker, Roche. The other top holdings are BT, Rolls-Royce, Capita and Imperial Innovations, which invests in life science and technology companies spun out from top universities including Imperial College London.

Imperial Innovations is by far the smallest company in the Woodford Equity Income top 10, with a market value of about £390m. AstraZeneca, by comparison, has a market value of almost £56bn. Imperial Innovations accounts for 3.6pc of the Woodford fund, which means that the fund owns about 13.5pc of the company.

It is understood that Mr Woodford took advantage of an opportunity to buy Imperial Innovations shares and won't seek to maintain its current weighting as the fund grows. Taking a large stake in a relatively small company is not always possible without causing the price to rise sharply.

Here are the top 10 holdings of the Woodford Equity Income in full.

AstraZeneca 8.3pc

GlaxoSmithKline 7.1pc

British American Tobacco 6.2pc

BT 6pc

Imperial Tobacco 5.3pc

Roche 3.9pc

Imperial Innovations 3.6pc

Reynolds American 3.6pc

Rolls-Royce 3.5pc

Capita 3.4pc

_{Holdings as of June 30}

Woodford Investment Management said it planned to publish a full list of the fund's holdings in a week's time.

Mr Woodford said he had a "cautious" view of the world economy because of the reining in of "quantitative easing" and falling expectations for global economic growth. As a result he was avoiding sectors that he saw as vulnerable.

“My cautious view on the global economy hasn’t changed," he said. "The liquidity flows that have supported asset prices over the past five years are going into reverse, while growth in many parts of the world is being downgraded.

“The global economy and financial markets both face a tricky time over the next few years, but there are still many undervalued assets in equity markets and it is these opportunities that the fund is seeking to exploit."

He added: “I’ve been using a pilot analogy to explain the process of building the portfolio of my new fund. We have taken off and we have already gained a lot of height, but we are not yet at cruising altitude. The portfolio will continue to evolve.

“I have been very careful in building a portfolio that avoids sectors that I believe are vulnerable to a faltering global economy. There is significant emphasis in my new fund on the tobacco and pharmaceutical sectors. These two sectors are resilient to falling demand, have strong balance sheets and attractive valuations." 

http://www.telegraph.co.uk/finance/personalfinance/investing/funds/10950615/Neil-Woodford-portfolio-top-10-my-10-favourite-shares.html 

Current reality of the UK Housing Market

http://telegraph.newsprints.co.uk/view/21892809/pd56436703_matt%20cartoon%20_jpg#.U7mOnBDPBi8.twitter

How To Develop A Trading Brain

"Tradingpsychologie," is a book on trading psychology that was published in Germany in 2012 and was received with great enthusiasm. Many readers and reviewers commented that it was the best book on the subject that they had ever read or that it was the first which was of any real use.

The book's author, Norman Welz, is a psychologist and journalist who developed a keen interest in the stock market and the associated psychology. His specialty is trading psychology, a subject on which he has not only extensive experience but also some unique insights. Among other things, he trains traders to develop their brains in the right direction.

Welz stresses that what differentiates both his work and his book from the vast literature in the field is the emphasis on applied trading psychology. It is common knowledge that traders need discipline, but accepting this idea is simply not enough to enable investors to operate in the appropriate manner.

The essence of the problem is that most people like and need security in all its forms, but "trading is the most insecure business you can be in," Welz says. He argues that no other profession creates so many and such intense emotions and reflects so much of our personalities. He goes so far as to state that stock market activities personify money: "we don't just trade assets and money, we become the money," according to Welz.

To trade effectively, the right mindset is essential. Yet, nothing is harder than divorcing ourselves from the multitude of factors that have created our mindsets in the first place and that dictate how our brains function. We are influenced by parents, family, friends, the environment, society, the media, books and more. By the time we start trading, all of these influences tend to fix trading patterns that are often dysfunctional or suboptimal. Trying to change these patterns is somewhere between difficult and frightening.

It Is Truly All in the Mind
In order to understand Welz's approach, it is necessary to understand the pervasive role of psychology and the brain. While the notion that psychology is vital to the stock market is nothing new, Welz believes that trading is literally 100% psychology. Without a psyche, we could never evaluate financial risk or recognize trends. "No brain, no stock market trading," says Welz. Mental strength is thus absolutely fundamental to trading success. Furthermore, about 95% of our actions are subconscious, and we tend to replicate our behaviors over and over again. All too often, this replication means repeating the wrong or even disastrous courses of action.

To support this contention, Welz refers to a study in which 120 traders were given a system that had proved its intrinsic value statistically in 19 of the last 20 years. After a test year, it was evident that 119 of these traders failed with the system because their mental tendencies led them astray. All but one trader had the wrong mental processes. "Success comes from the head," Welz says. The system was good, but the attitudes and psychology with which the traders applied that system were not.

Why Do Traders Neglect Psychology?
Most traders are men, who tend to think that psychology is not what really matters. They think that what matters, rather, are simplistic notions of being coldly rational, well informed and experienced. According to Welz, however, rationality, information and experience don't help if the brain is not appropriately programmed and tuned. So what can we do to get our minds and subconscious to act appropriately?

Welz's Approach
Norman Welz works on the brains of traders through the subconscious and hypnosis. Trainees are put into a trusting mood and the necessary competences are anchored in subconscious regions of the brain. If this process sounds a bit weird, consider this: For many years, Welz has helped people overcome their fears and blockages, enabling them to win sporting championships and even to secure an Olympic victory. Furthermore, he has helped traders to earn money through activating the right mental energy, motivation and, thus, behavior. He stresses that each person has unique mental bridges and barriers that need to be crossed or overcome in order to ensure success.

"Trading discipline" comes from modifying one's behavior in a desired direction and overcoming the mental resistance and fear that generally get in the way. Particularly in the context of trading, Welz believes that "there are armies of resistance." The trading brain in fact entails an integration of the right investment and market knowledge with the right mental capabilities. It is not that the usual skills are unimportant, it is just that they usually get overridden by the wrong mental and behavioral patterns.

Effective trading thus involves personality modification. According to Welz, "people who are not willing to attempt this should not even bother with trading." Those who concentrate only on the so-called logical aspects of charts and trends, including all those patterns like "flags, triangles and channels or stops and trading ranges," will ultimately flounder on the myriad of emotions that inevitably come into play and even dominate the markets.

The above, explains Welz, is "the ultra-short version" of his theory, but indeed the essence of the matter. Furthermore, he believes that anyone can become a trader and overcome his or her fears. Provided that people are not clinically ill, they can resolve those fundamental anxieties if they are truly willing to work on themselves. In addition, they need a good sense of and grip on reality if success is to result. Of course, financial knowledge and skills, information and research all still play key roles.

However, it is hard work getting there. Welz believes that people shouldn't think they can "start with a mini-account and live from their earnings as a professional trader within six months." It takes time and dedication. Welz believes that if this weren't the case, the roads would be full of Ferraris and Porsches.

The Bottom Line
The fundamental role of trader psychology tends to be underestimated and too much emphasis placed on the technical side. While both are essential, it is arguably the right mindset that differentiates successful from unsuccessful traders. However, learning the technical aspects of trading is more straightforward than acquiring a top-notch trading brain. The latter generally entails working intensely on one's own personality traits and eradicating entrenched behavioral patterns. This process is not easy and requires dedication, time, and often, the aid of a skilled coach. Nevertheless, the results are very likely to reap dividends.

http://www.investopedia.com/articles/basics/13/how-to-develop-trading-brain.asp 

Advisers still suspicious as Dow closes over 17,000

As stocks cross a symbolic threshold, advisers remain ambivalent about a five-year bull market

(Bloomberg News)

A buoyant U.S. jobs report and a reinforced commitment by central bankers to hold interest rates low pushed the Dow Jones Industrial Average over 17,000 for the first time today, providing new energy to a stratospheric bull market that financial advisers are treating with ambivalence.
In an abbreviated pre-holiday session, the Dow closed at 17,067.49, up 0.54% on the day. Both the Nasdaq and the S&P 500 were also up, as investors entered the third quarter with apparently renewed optimism about the strength of a bull market that is now five years old. In that time, the S&P 500 is up nearly 190%.
“The market is on pace for another double-digit gain [this year] — I think that was pretty shocking to people,” John Russel “Rusty” Vanneman, chief investment officer for CLS Investments, said earlier this week. “You would have to think we’re in the last innings of the bull market.”

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The Dow broke through the trading threshold after the U.S. Labor Department said nonfarm employment grew by 288,000 in June and that the unemployment rate fell to 6.1%, its lowest point since September 2008. The S&P 500 was trading around 1985, also a record-high for that stock index, which is up about 8% this year.
What is good news for most is worrisome for financial advisers, who fear that their clients might be too anxious to rush into the market just as it might be peaking.
“Bullish sentiment seems to be a little bit overdone right now,” said Dan McElwee, executive vice president of Ventura Wealth Management. “I’m more concerned about downside [risk] over upside because the market is looking frothy.”
Nonetheless, after years on the sidelines, Mr. McElwee says clients are increasingly looking to put cash into rallying markets.
“Everyone wants 2013 returns in 2014,” Mr. McElwee said, referencing the nearly 30% gain of the S&P 500 last year. “Clients are bringing their checkbooks to invest; they’re not bringing in existing accounts. People are not just getting off the sidelines so we have to caution people about not getting too aggressive when the market seems extended in the short term.”
Adviser E. Michael McGervey said the most common question about the markets he gets from clients is, “How long is the market going to continue to run?”
What they don’t ask about — generally — is something that takes up a lot of Mr. McGervey’s time: how to structure bond portfolios for when interest rates rise.
Central bankers in Europe and the United States reaffirmed their commitment this week to keeping the interest rates they control at historic lows in an effort to stimulate developed economies recovering from the 2008-09 recession.
The issue remains off the radar for Mr. McGervey’s clients until he brings the subject up in meetings.
“You have to remind them that this is not an exercise of trying to time the market — it’s following a rigorous discipline week after week to make sure that we’re staying true to our process,” he said.

http://www.investmentnews.com/article/20140703/FREE/140709971 

FOREX Trading Strategy - 15M Channel Trading +70 pips

My own notes....

Using channels is critical for your success in Trading.  Always keep an eye on the bigger picture, make sure the trend direction is in your favour.  If the trend is going up then look for the entries and go aggressive to the long side.  If a signal is given on the short side and the trend is up, by all means enter the trade but make sure the signal is undeniable and be less aggressive and get out more quickly taking any half decent gains.  If the trend is up and you have entered a long trade you can afford to ride the trade a bit longer.

Risky mortgages of more than 4.5 times income to be limited as Bank acts to prevent a damaging house price bubble

• Bank targets the largest and most risky loans

• Action stop short of widespread cap on lending predicted by economists

• All lenders required to apply stress test to mortgage applicants

The number of high-risk mortgages will be limited in the future after the Bank of England announced measures to cut the risk of a damaging house price bubble emerging.

By October, Banks will have to ensure that riskier loans of more than four-and-a-half times a borrower's income make up no more than 15 per cent of the new mortgages they grant. The timeline means the restriction will apply from today, the Bank said.

Announcing its latest Financial Stability Report, the Bank also said that lenders should apply a new 'interest rate stress test' ensuring that borrowers can keep up their mortgage repayments in the event of a three percentage point rise in the Bank rate.

Imposing: The Bank of England is expected to make recommendations to cool the housing market

The Bank said in the report: 'The recovery in the UK market has been associated with a marked rise in the share of mortgages extended at high loan to income multiples.

'At high levels of indebtedness, households are more likely to encounter payment difficulties in the face of shocks to income and interest rates.

'This could pose direct risks to the resilience of the UK banking system and indirect risks via its impact on economic stability.'

Speculation had been mounting that the Bank would propose more drastic measures to rein in the way loans are handed out, as fears continue to rise that surging house prices could damage the economic recovery.

Economists had expected the Bank's Financial Policy Committee, chaired by governor Mark Carney, could limit the amount that homeowners could borrow more widely. Business Secretary Vince Cable said recently that a level of three to three-and-a-half times income was an appropriate level.

Taking action: Bank of England governor Mark Carney has a range of tools at his disposal to cool the market

The measures announced today will have a less dramatic effect and will not outlaw loans worth more than 4.5 times income completely, but only keep their number to 15 per cent of new mortgages.

The Bank said that the limit was designed to prevent a rapid expansion of high-risk loans that has occurred prior to previous house prices crashes.

The current proportion of mortgages granted for more then 4.5 times incomes has grown this year, but remains below the new limit at 11 per cent, according to the Financial Stability Report.

The move will be felt most in London and the South East, where the Bank said two thirds of loans of 4.5 times income and above are granted.

Martin Beck, senior economic adviser to the EY ITEM Club, said the Bank needed to take action to cool the housing market to maintain credibility.

However, he added: 'The recommendations announced today alongside the publication of the Bank’s Financial Stability Report are fairly modest.

'The direct effect of the FPC’s announcements in cooling the housing market is likely to be limited. With high loan-to-income mortgages currently accounting for only around 10 per cent of the total, there is still sizeable room for such lending to expand before the FPC’s cap is reached.

'The measures will of course not apply to cash purchases, which the latest data showed rising to a record high as a proportion of home sales.'

Alongside the FPC action, the Treasury confirmed that no loans of more than 4.5 times income will be granted under the mortgage guarantee element of Help to Buy, which provides protection to banks when then lend to borrowers with small mortgage deposits.

Paul Smee, director general of the Council of Mortgage Lenders, said: 'The new affordability stress test that requires lenders to check their borrowers' affordability against an assumed Bank rate 3 per cent higher than at origination will clearly ensure resilience to shocks.

'Limiting the level of a lender's lending to no more than 15 per cent of new mortgages at 4.5 times income or above (and none at all for Help to Buy guaranteed loans) is likely to impact the London market more than elsewhere. Nationally, 9 per cent of new loans are at 4.5 times income or more, but the figure is 19 per cent in London.'

Some banks have already taken steps to curb the largest loans. State-backed lenders Lloyds Banking Group and Royal Bank of Scotland have set a limit of four times a borrowers’ annual earnings on all loans above £500,000.

The Bank of England also told lenders to test whether borrowers could still afford to pay back the mortgages if interest rates were to soar to three per cent or more.

Strict rules introduced by the Mortgage Market Review in April have already forced lenders to test how mortgage customers would cope with steep rate rises.

But while the MMR already recommends applying the seven per cent test, Mr Carney has made the three per cent threshold mandatory.

The Bank of England has a range of new tools at its disposal, which it could use to cool the market. It could still take further steps to cool the market if it feels further action is required.

Official figures show average UK property prices soared 10 per cent in the year to April to stand at a new all-time high of £260,000.

If rapid growth does not moderate, the Bank could also force lenders to hold a higher proportion of the capital loaned for every mortgage.

The Bank had been dropping hints for some time that it could use some of its tools to calm the market. Deputy governor for financial stability Sir John Cunliffe recently described the housing market as the ‘brightest’ of the blinking warning lights that the Bank monitors.

Signs have emerged that the new MMR rules are already taking some of the strongest heat out of the property market and applying the brakes to lending. Earlier this week, the British Bankers' Association (BBA) reported that mortgage approvals fell back for the fourth month in a row in May.

Bank governor Mark Carney appeared to play down the prospect of imminent interest rate rises when he appeared before the Treasury Select Committee this week.

Mr Carney had indicated in his recent Mansion House speech that the first interest rate rise may come ‘sooner than markets currently expect’, leading many observers to speculate it could arrive by the end of this year.

Labour's Pat McFadden told him: ‘It strikes me the Bank is behaving a bit like an unreliable boyfriend - one day hot, one day cold - and the people on the other side of the message are left not really knowing where they stand.’

http://www.thisismoney.co.uk/money/article-2670424/Bank-England-set-announce-stricter-mortgage-rules-cool-overheating-housing-market.html

Peter Schiff: Gold Update, The Dollar Will Collapse First, Janet Yellen ...

Buy miners of precious metals but be careful which miners you buy.  Maybe go for reputable precious metal mining funds.  At the moment the precious metals are a bit of a win win.  They are still hated and so are very cheap to buy.  If stock markets collapse then it is likely in the medium term people will flock to gold and silver for protection.  Historically gold does very well in bad economies.

Alternatively if stock markets rally (after a pullback a bit of a pullback) then due to mining stocks being so cheap they will probably do ok anyway.

The 4 losers preventing Dow's 17,000 party

Investors are ready to celebrate Dow 17,000. There’s just one problem: It’s not happening.

Why not? There are four stubborn stocks stopping the much-watched Dow from soaring above the 17,000 level for the first time. We’re looking at you Visa (V), International Business Machines (IBM) Boeing (BA) and Goldman Sachs (GS).

What makes these four stocks the most troublesome, for the bulls at least, is that they’re the highest-priced stocks that are in the red for the year. Since the Dow gives greater weight to stocks with the highest per-share prices, when you see stocks that trade for north of $100 a share struggling, those are the ones that are causing the problem.

Three of the stocks with the highest per-share prices in the Dow, Visa at $210.19, IBM at $182.29 and Goldman Sachs at $170.49 are all down this year. That goes a far way to explain why the Dow just can’t seem to break 17,000. It’s trading at 16,952 in mid-day trading Tuesday.

Visa is a classic and perfect example. The credit card processing company’s shares trade for $210 a share, making it the highest priced stock in the Dow. And shares of the company are down 5.6% this year, a heavy anchor for the other Dow components to make up for.

These aren’t the only Dow stocks that are down this year. There are 11 stocks in the Dow that are in the red for 2014 so far and are all contributing from stopping the Dow from reaching 17,000 glory.

All this adds up to a big burden for the stocks that are working, many of which that have smaller per-share prices. For instance, computer chipmaker Intel (INTC) is the second-best gainer in the Dow this year (after Caterpillar), gaining 18.6%. But Intel trades for just $30.79, meaning that its gain is completely swamped by the the losers.

Yes, the Dow can still pierce 17,000 even if these four high-priced stocks keep struggling. But as long as these four high-priced stocks are drags, 17,000 is all that more difficult to reach and make investors wait that much longer.

The four stocks with the highest per-share prices in the Dow that are down this year:

Company	Symbol	Current price	YTD % Ch.
Visa	V	$210.19	-5.6%
Int’l Bus. Machines	IBM	$182.29	-2.8%
Goldman Sachs	GS	$170.49	-3.8%
Boeing	BA	$130.79	-4.2

5 industries that Millennials are destroying

Analysis: The younger generation doesn’t like cars, cable TV or soft drinks

PepsiCo                   

            

There’s a lot to be said for watching demographic shifts as you craft your long-term investing strategy.

And while Baby Boomer stocks like health care and insurance get a lot of attention, long-term investors should also consider the impact Millennials will have on businesses — and their portfolios.
There are about 80 million Americans who were born between 1980 and 1995. And while much has been made about the challenges for Millennials to get good jobs or contribute to the economy, that is sure to change. As the Boomer population starts its inevitable decline, the power of this age group will grow substantially in the years ahead.
Some of that will be good, as the tech talents of younger Americans are put to work in the economy and as they grow into a powerful consumer class.

                   

But for some stocks, the rise of Millennials is assuredly bad news.
Which picks? Well, here are five specific businesses that Millennials are shunning, which could cause a lot of pain for investors over the long-term if current trends continue.

Cars
Cruising around in my rusty Chevrolet Cavalier with the sunroof open and the radio up was the very definition of freedom to me at 18 years old.
But these days, there’s simply not the interest in cars like there used to be.
Consider that in 2010, a mere 28% of 16-year-olds had driver’s licenses, compared with 44% in 1980, according to another study from the University of Michigan Transportation Research Institute .
Car sales in America have rebounded in recent years thanks, in part, to pent-up demand after the Great Recession, but the sad reality is that the U.S. love affair with the automobile may be coming to an end. That’s in large part due to a lack of interest among Millennials who look to live in walkable, urban locations and prefer car-sharing services like ZipCar or ride sharing services like Uber.
A car is just an expensive hassle for the younger generation, as technology equals freedom in 2014.
Sure, U.S. car sales could top 16 million in 2014 to mark the highest level of vehicle sales since 2007. But General Motors and Ford are up only about 6% in the past 12 months vs. 18% gains for the broader stock market. So clearly there are concerns about how sustainable this success is.
And as the reluctant drivers in the Millennial generation become a larger share of the car-buying public, the pressure could persist for some time — and after big rebounds since the bailouts of the Great Recession, too much optimism may be baked in to automakers.

Cable TV
It’s unclear where streaming video is headed in the next several years. But it’s clear that the future is likely with Netflix or Google property YouTube and not an old-guard cable company.
Consider that for the first time ever, the number of pay-TV lines in the U.S. fell last year — with a drop of about 250 million subscriptions over the calendar year. That’s a big number, and a number that seems to be growing at an alarming rate.
Alarming, at least, if you’re a company like Comcast or Time Warner Cable.

Part of the problem is “cord cutting” as folks with cable TV find options on Netflix or other streaming providers at a fair price. But increasingly, traditional cable-TV businesses are going to face the big pressure of Millennials and so-called “cord nevers” who haven’t ever had an affinity to cable and see no reason to start anytime soon when so much of their entertainment is consumed via laptop, tablet or smartphone.
Clearly the industry is circling the wagons, with Comcast bidding for Time Warner Cable. Similarly, AT&T is looking to snap up DirecTV — not just to bolster its U-Verse pay-TV business but also to help the company transition into a new content delivery company in the Internet age.
There are big pressures ahead for those that can’t evolve with the times. So while investors may like the dividends of some previously reliable telecoms, it’s important not to forget the long-term headwinds for anything related to cable TV.

Brick-and-mortar retail
In the short term, I think retail is in big trouble. But folks blaming bad first-quarter weather are missing the broader long-term pressure of e-commerce that is reshaping the entire sector as more shoppers go online instead of to the mall.
Broadly, online sales continue to outpace brick-and mortar results. Online retail sales grew about 17% in 2013, with total overall retail sales up only a fraction of that. So it’s no surprise that some of the biggest laggards in retail are stores that simply can’t get their online acts together.
Take specialty-clothing retailer The Buckle. This small-cap retailer used to be a growth darling, but now has fallen on very hard times as trendy shoppers look for alternatives on the web. Part of the reason the stock has been soft is a flight from malls, with same-store sales declining 0.9%, but the other element is a lack of online presence to replace that lost revenue. Consider The Buckle online sales totaled a meager $21.4 million last quarter — barely 2% of total sales.
Brick-and-mortar retailers that can’t change with the times and evolve to a digital-sales platform are going to continue to feel the pain as more retail sales go online in the years to come.

Homebuilders
By now, you’ve certainly seen all the stories about why Millennials are a drag on the housing recovery.
The reasons are numerous, but the biggest one-two punch tends to focus on the personal desire to live urbanely and the financial practicalities of less income and a lot of student-loan debt.
Consider that about half of home-buying Millennials lately are asking mom and dad to shoulder their down payments, according to a recent Trulia survey. Others are so spooked by the Great Recession and mountains of student-loan debt that they have no desire to take on a mortgage at all considering other financial concerns.
Homebuilders like PulteGroup and Toll Brothers have been under pressure for the last year or so as the rebound in housing has petered out and construction has tapered off. But just imagine what would happen if interest rates tighten and the cost of borrowing climbs even higher!
Millennials don’t want to live in surburbia, and either can’t or won’t take on a mortgage payment. And that trend is not going away.

Soft drinks
Sugary, carbonated beverages like Coca-Cola seem like the staple junk food of any young American. But not anymore, thanks to a focus on fighting childhood obesity and a rise of healthier alternatives.
As a result, Millennials drink much less soda (or pop or whatever you want to call it). And that number is declining every year.
A recent Morgan Stanley report illustrates how the shift to energy drinks and sports drinks in the past decade is partially to blame. But while that’s good news for America’s health, it’s very bad news for investors like Warren Buffett, who have always considered Coca-Cola the gold standard of consumer staples.
Sure, Coca-Cola has tried to hedge its bets with lines like its Odwalla juices and Powerade sports-drink lines. But the flagship soda brands of Coke and Sprite are facing real headwinds in the years ahead.
Perhaps companies like Coca-Cola and Pepsi can continue to diversify and evolve, both at home and abroad. But investors need to know what they are getting into with these consumer-staples companies that are increasingly less popular with younger Americans.

http://www.marketwatch.com/story/5-industries-that-millennials-are-destroying-2014-06-21?pagenumber=2

Gold Stocks Poised to Build on Gains

After a few false starts this year, the technicals have finally lined up to suggest the time is right to nibble.

Although gold is still languishing below the $1,300 mark, gold stocks are giving hope to long-suffering bulls. In fact, technical signs in many places suggest that a decent rally is now in the cards.

To be sure, there is plenty of work left to do before we can even think that gold and gold stocks are heading back up to their 2011 levels. But even so, there is plenty of room for growth before the comeback runs into serious resistance.

Back in April, the Market Vectors Gold Miners exchange-traded fund (ticker: GDX ) seemed to stabilize, and I wrote here that "…the technical evidence for a new bull market is not yet there. It does appear to be getting close, however." (See "Getting Technical, "Gold and Silver Are Almost Ready to Rally," April 28.)

At the time, sentiment was extremely bearish. When the ETF broke down through chart support in May it became extreme. It was as if everybody expected the market's bottom to drop out. Calls for gold to tumble seemed to be everywhere. Indeed, withdrawals from the popular SPDR Gold Trust ETF ( GLD ) continue even now at a rather fast clip as demand diminishes.

But to a contrarian technical analyst, this is bullish. If most investors think gold prices are heading lower and sell their positions, then there will be no sellers left. Supply dries up, and any spark can get the market moving higher.

The gold miners ETF has already started to make that move. After dropping sharply in mid-May as gold broke down, it immediately stabilized (see Chart 1). In fact, on-balance volume began to rise, indicating that money was starting to flow back into the ETF. Within days, the May plunge was erased.

Chart 1

Market Vectors Gold Miners ETF

In Wednesday's trading, the ETF confirmed its rally by moving nicely above its 200-day moving average.

From a long-term perspective, we can see a developing bottoming pattern that some may interpret as an inverted, or upside-down, head-and-shoulders (see Chart 2). This pattern spans more than one year with its important lows occurring in June 2013 and December 2013 with last month's bottom likely being the final low.

Chart 2

Market Vectors Gold Miners ETF, Long Term

I am not so sure a head-and-shoulders is the proper label, but despite the semantics there are other pieces in place that suggest the bottom has been made. The most obvious is the shift in momentum to the bullish side. One indicator, the relative strength index (RSI), has been sporting higher lows over the past year. This tells us that the power in the market reverted to bullish hands. Price moves are somewhat stronger to the upside than to the downside.

We can also see the same pattern and characteristics in the Global X Silver Miners ETF ( SIL ) to add even more confirmation to the mix.

Of course, not every stock in the group offers such good news. But from giant Goldcorp ( GG ) to the much smaller Iamgold ( IAG ) there are plenty of candidates from which to choose.

As gold stocks are linked with gold itself, let's take a quick big-picture look at the gold ETF. Starting at the major low set in 2008, the ETF rallied to 2011 and then retraced roughly 62% of that gain at last year's lows (see Chart 3). Chart watchers will recognize this as an approximation of a 61.8% Fibonacci retracement and a level at which demand often re-emerges.

Chart 3

SPDR Gold Trust ETF

If we move further back in time, last year's lows also occurred at the 50% retracement of the rally from 2005. While that was not the lowest point of the prior bear market, it was the low that occurred just before the rally really got moving.

Finally, last year's lows were also at the measured downside target for the break of a large triangle pattern seen in 2011 and 2012. Projecting the height of a pattern down from the breakdown point often yields an objective for the bears.

With gold seemingly reaching a solid floor and gold stocks starting to make real technical progress, it does seem that now is a good time to take a nibble on the latter.

Again, the proof for a long-term bull market is not in place, and the gold miner ETF has a rather strong ceiling above in the $31 area (it closed Wednesday at $24.77). But the opportunity for profit in the short term seems real. 

http://online.barrons.com/news/articles/SB50001424053111903927604579632154048334592?mod=BOL_twm_da 

How should you respond to the crisis in Iraq?

The headlines are all about the tragic events in Iraq at the moment.

The extremist group, Isis, has made remarkable gains.

Some argue that this proves that we should never have invaded Iraq in the first place. Others (like myself) think that the decision to pull out all troops at the end of 2011 is responsible for the collapse.

But whatever your interpretation of the past, we need to figure out how this latest Iraq crisis will affect global markets in the future.

Could the latest crisis spark a wider conflict, sending oil prices soaring? Or are these fears overblown?

And do you need to take any measures to protect yourself?

 

Why is this taking place?

We’ll be taking a more detailed look at the causes of the events in Iraq in this week’s magazine.

However, there are three main reasons for the current crisis.

Firstly, Iraq is a country divided along religious lines. While most Iraqis are Shia Muslims, there are significant numbers of Sunni Muslims (along with Kurds and a small Christian population). Saddam Hussein’s regime heavily favoured the Sunni minority while the Sunnis now claim that the current government has been doing the same thing in reverse.

The second factor is the influence of external countries. Since Saddam’s fall, several regimes (especially Iran and Syria) have supported terrorist groups.  Ironically, many of these terrorist groups ended up turning on their former masters. This is most apparent in the case of Syria, where Isis now controls a swathe of the Syria/Iraq border. The Syrian conflict is now spilling over into Iraq.

Finally, there is evidence that some of the Gulf States, such as Saudi Arabia, are backing Isis in order to counter Iran.

So is this a threat? 

It’s clear that Isis has made tremendous gains. However, the Iraqi government still has a large advantage in terms of material, soldiers and funds. Large numbers of civilians have also joined up. Iran has also sent a small number of special forces.

What’s more, while the US has not formally made a decision, it looks like these events will force it to expand support for Nouri al-Maliki’s government, and launch some form of air campaign.

Already there is evidence that Baghdad has halted the Isis advance and forced them onto the defensive. It’s also important not to overstate importance of sectarian factors. While Sunnis may not like Maliki, most of them don’t want anything to do with the insurgents.

All this means that the most likely outcome is a prolonged insurgency in parts of the country, not the immediate implosion of Iraq. Isis probably won’t seize Baghdad.

 

What this all means for investors

So, should investors panic and sell all their shares?

Well, there are plenty of reasons to think twice about certain markets. For instance, the US is trading at a sky-high Cape ratio of over 25. Other measures, such as price-to-book value (price relative to net assets) and Tobin’s Q (the cost of replacement capital) tell a similar story.

So, there are good reasons to fret about US share prices, but the Iraq crisis probably isn’t one of them.

And overall, there’s no reason to dump shares in general, since the wider impact (in terms of markets) is likely to be limited. Indeed, studies suggest that investors have a tendency to overreact to bad headlines. So, you might want to look at the cheaper markets, like Ireland and Greece.

As for oil, the oil prices have gone up in the past few days to the highest levels since last September. If prices rise further and stay at higher prices for some time, we could see a modest slowdown in economic growth.

However, the impact of the crisis on the oil market is likely to be smaller than some people expect.  Remember that most of Iraq’s oilfields remain in either the government’s hands, or are controlled by the Kurds. In any case, Iraq’s production lags behind that of Saudi Arabia and Iran. Thanks to the fracking-related oil boom, Iraq produces less than 40% of the US’s output.

I fear that we’re going to see more horrifying pictures from Iraq in the weeks ahead, but investors should stay calm.

http://moneyweek.com/money-morning-how-should-you-respond-to-the-crisis-in-iraq/ 

Why A New Skyscraper In Saudi Arabia Could Mean Doom For The Global Economy

 

Smith Gill

Saudi Arabia is expected to begin work on the Kingdom Tower next week.
The building in Jeddah is expected to cost $1.23 billion and stand 3,280 feet tall, according to the Saudi Gazette.
That's 568 feet taller than Dubai’s Burj Khalifa.
Construction is also underway on Sky City in China, projected to be 2,749 feet tall. Sky City is expected to finish before the Kingdom Tower and will, for a very brief period, hold the title of the world's tallest building.
Two years ago, Barclays introduced its Skyscraper Index, which suggests that construction booms, highlighted by record-breaking skyscrapers, coincide with the beginning of economic downturns.
In his 2012 report, Barclays' Andrew Lawrence and his team wrote that this is because "the world’s tallest buildings are simply the edifice of a broader skyscraper building boom, reflecting a widespread misallocation of capital and an impending economic correction."
But it isn't just the world's tallest building we should be looking at. Lawrence said it's also important to look at the number of skyscrapers being built and their geographic profile. This is because the tallest buildings "rarely stand alone."
With this in mind, investors should watch the building booms in China, India, and Saudi Arabia.
Here's a look at the Skyscraper Index from Barclays (click the image to enlarge it). Basically, what you see is a series of famous skyscrapers associated with subsequent busts. The most recent one is Dubai's Burg Khalifa. Another notable recent one is Malaysia's Petronas Towers, which presaged the Asian economic crisis of the late '90s.

Barclays/Skyscraper Source Media's SkyscraperPage.com

Drawing on Barclays' Skyscraper Index, we pulled 10 skyscrapers whose constructions coincided with the financial crises of their times.

Equitable Life Building (1873)

Wikimedia Commons

Equitable Life Building

The Long Depression, 1873–1878
The pervasive U.S. economic recession with bank failures that came to be known as the Long Depression coincided with the construction of the Equitable Life Building in New York City in 1873. At the time the building was the first skyscraper at a height of 142 feet.
Source: Barclays

Auditorium (1889) and New York World (1890)

Wikimedia Commons

New York World building aka Pulitzer Building

British Banking Crisis, 1890
Chicago's 269-foot-tall Auditorium building, completed in 1889, and the 309-foot-tall New York World building, completed in 1890, coincided with the British banking crisis of 1890 and a world recession.
Source: Barclays

Masonic Temple, Manhattan Life Building, and Milwaukee City Hall (1893)

Richie Diesterheft via Flickr

Milwaukee City Hall

U.S. panic marked by the collapse of railroad overbuilding, 1893
Chicago's 302-foot-tall Masonic Temple, the 348-foot-tall Manhattan Life Building, and the 353-foot-tall Milwaukee City Hall coincided with the U.S. panic of 1893 marked by the collapse of railroad overbuilding. It also coincided with a string of bank failures and a run on gold.
Source: Barclays

Park Row Building (1901)

John Salvino via Flickr

Philadelphia City Hall

First stock market crash on the NYSE, 1901
The construction of the 391-foot-tall Park Row Building presaged the U.S. stock market crash and panic of 1901, as did the completion of Philadelphia City Hall, which stood at a height of 511 feet.
Source: Barclays

Singer Building and MetLife Building (1907)

Wikimedia Commons

Singer building, New York

The Bankers' Panic and U.S. economic crisis, 1907–1910
The construction of New York's 612-foot-tall Singer building and the 700-foot-tall Metropolitan life building corresponded with the panic of 1907. The Bankers' Panic was a financial crisis that occurred after the NYSE fell nearly 50% from its peak, and reflected a monetary expansion brought about by the establishment of trust companies.
Source: Barclays

40 Wall Street (1929), Chrysler (1930), and Empire State Building (1931)

REUTERS/Gary Hershorn

The Great Depression, 1929–1933
The construction of three record-breaking buildings coincided with the onset of the Great Depression. 40 Wall Street, which on completion in 1929 reached 927 feet, followed by the 1,046-foot-tall Chrysler building in 1930, and the Empire State building in 1931, which towered over the others at 1,250 feet.
Source: Barclays

World Trade Center (1972-1973) and Sears Tower (1974)

AP Images

U.S. and worldwide economic crisis, 1973–1975
The 1972 construction of One World Trade Center, the 1973 completion of Two World Trade Center, and the 1974 construction of the Sears Tower in Chicago coincided with a period of speculation in monetary expansion from foreign lending.
It also coincided with the collapse of the Bretton Woods system, a rise in oil prices that caused a global economic crisis, and speculation in stocks, property, ships, and aircraft.
Source: Barclays

Petronas Towers (1997)

AP Photo/Mike Fiala

Asian economic crisis, 1997–1998
The Asian economic crisis, currency devaluation, and speculation in stock and property coincided with the completion of the Petronas Towers in 1997. At 1,483 feet, the Petronas Towers were the tallest buildings in the world and heralded a crisis in that region.
Source: Barclays

Taipei 101 (1999)

REUTERS/Pichi Chuang

Dot-com bubble, 2000–2003
The construction of the 1,671-foot-tall Taipei 101 began in 1999 and was completed in 2004. The duration coincided with the tech bubble and the recession in the early 2000s.
Source: Barclays

Burj Khalifa (2010)

AP

The Great Recession, 2007–2010
The 2010 completion of the tallest building in the world, the Burj Khalifa, which towers at 2,717 feet, coincided with the current global financial crisis. The building surpassed Taipei 101's height on July 21, 2007.
Source: Barclays

Construction on Sky City in China is underway

differentenergy via YouTube

Sky City, outside of Changsha, China, is expected to rise to 2,749 feet. The 220-story building is expected to take seven months to build at a cost of $628 million. It is also expected to house 30,000 people.
This construction comes as concerns of a Chinese hard landing have returned. "The housing sector now poses the biggest downside risk to the Chinese economy," wrote Societe Generale's Wei Yao. And after its first corporate-bond default, many began to wonder if China's Minsky moment had arrived.
Of course in China's case we won't know for a few years if this recording breaking skyscraper coincided with an economic bust.

http://www.businessinsider.com/skyscrapers-that-predicted-financial-crises-2014-4?op=1