The Disruptive Discoveries Journal

By Chris Berry

It is widely acknowledged that credit is the lifeblood of an economy. It provides the leverage for growth. The interest rate assigned to a fixed income security can then be thought of as the “cost” or “price” of the credit.

This makes sense as lenders want to ensure their assets (cash, typically) earn a return above the risk free rate. To be clear, there is much more to determining an interest rate, but this is the basic premise.

What happens, though, when that rate goes negative?

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The Disruptive Discoveries Journal

By Chris Berry (@cberry1)

If recent mainstream media, sell side, and newsletter writer coverage wasn’t enough to convince you, it is all but obvious that lithium has emerged as an investible asset class for 2016 and beyond as the broader commodity sector continues to struggle with overcapacity and slack demand. While the excitement is born of strong growth in technologies requiring lithium (mainly electric vehicles and energy storage), the real reason for investor excitement boils down to one issue: price.

As The Economist shows, the lithium carbonate spot price has gone parabolic.

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The Disruptive Discoveries Journal by Chris Berry

If anything is clear after the start of 2016, the global economic rebalancing that central banks around the world are trying to engineer is not proceeding according to plan. The circuit breaker fiasco in the Chinese equity markets is the latest example giving investors pause with respect to what is truly “going on” in China. The Shanghai composite equity index has lost almost 15% of its value YTD and few see good reason for this slide to halt aside from intense government support and RMB devaluation. Money continues to flow out of China as we speak.

This drains China’s FX reserves – a tool the Chinese need to manage a weakening RMB, a headache with global repercussions. Additionally, it appears increasingly likely that the US Federal Reserve just raised short term rates into a weakening US economy (December jobs growth not withstanding). When the central banks of the world’s two largest economies are losing credibility, it’s no wonder financial turbulence has increased.

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By Rachel Fox of FoxOnStocks.com

First of all, allow me to say, after having come from Stocktoberfest earlier this week and hearing the word millennial be used ad nauseam during my panel discussion titled: What the Hell is a Millennial and what is it Doing for the Economy, I’m quite tired of the term millennial.

It’s become quite an obnoxious word, way over used at this point, lacking in meaningful description, and just lumps us all into one group as if we’re all the same… which we’re not.

In this blog, I’m strictly using the term, as the common name for an age group I’m particularly interested in talking to about investing, finance and retirement… mainly because I happen to be a part of that group myself.

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