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What percentage of my salary should I invest each month?

What percentage of my salary should I invest each month?

A question that often worries young earners is, “What percentage of my salary should I invest each month? Is 10% okay? Or should it be 20%?” Often this is asked when a person wants a quick rule of thumb to check if they are on the right track so they spend free from guilt. Unfortunately, there are several wrong questions that people ask when it comes to personal finance and this is one of them.

There is something weirdly comforting about a thumb rule. The answer to this question often is, “as a thumb rule, one should at least save 10% each month”. Every equation has underlying assumptions buried deep within. A thumb rule has twice the number of such assumptions because it is often the simplification of a formula.

Young earners often make the mistake of assuming “they have no goals” just because they are single and their parents are healthy with reasonable financial independence. This is the best time to plan for financial independence – gradually reduce the dependence on getting up to work on Monday morning (even if it is from home).

In this day and age, there is no need for thumb rules. Using a calculator will take only about 30 minutes (most of the time would go in appreciating the inputs). Here are two examples. One for the US and one for India.

CNN Money had a “Will you have enough to retire?”  calculator applicable for US residents with extensive fine print. Sadly only the fine print seems to be available now! At least it does not seem to work on Chrome. Here is a screenshot.

Screenshot of CNN money "will you have enough to retire calculator?"

These are some key assumptions in the fine print:

  • longevity up to age 92
  • Social Security is factored in.
  • All calculations are pre-tax
  • calculated using an inflation rate of 2.3%
  • return is 6%
  • the inflation-indexed annuity rate is 6%
  • the current income grows at an annual rate of 3.8%
  • assume you can live comfortably off of 85% of your pre-retirement income

Notice that the savings rate should be 23% for a real return of close to 4% (return =6%, inflation is 2.3%) with social security available and tax has not been factored in!! It is folly to assume even for US conditions that investing 10% or 20% of income is sufficient. Our inflation (for the individual, not the govt declared value) is anywhere between 8-10% (assuming no lifestyle change expenses -good or bad).

Our portfolio returns (not just equity) will have to be at least 10-12% after-taxto combat inflation. Will we get that? Not if we have blind trust on “SIP”. See: 15-year SIP returns for 71 out of 148 equity MFs is less than 10% and Ten-year Nifty SIP returns have reduced by almost 50%

Want an (unpleasant) Indian thumb rule?  Invest as much as you spend each month for normal retirement when you are unmarried with no dependents.

For early retirement in India (FIRE),  invest close to twice as much as you spend each month. Not impossible, but depends on your priorities (an understanding spouse and of course, luck*). I have managed to do this for the last 10 years or so and in spite of setbacks such as this – My retirement equity MF portfolio return is 2.75% after 12 years! – been able to maintain more than 30 times my current annual expenses. From borderline financial independence, I have got a little more comfortable. Also see Retirement Planning: My Story So Far and Analysis: My Mutual Fund Investing Journey.

This simple calculator can be used to find out what percentage of your expenses (not income) you should be investing for retirement. Will only take you about 5 minutes. Here is a screenshot with inputs that I would use.

The post-retirement rate of interest is 1% above inflation rate. For normal retirement, this is borderline reasonable and therefore, borderline dangerous. Recognise that is for 30 years later!! Who knows what will happen then! Better to be reasonable, err on the side of caution to start with, use the retirement calculator once a year with updated inputs. As retirement approaches, the numbers will become more accurate.

There are too many assumptions involved and while we can be reasonable with our inputs, the only security is to invest more, as early as possible. Another reason to do so is that as we age, unexpected expenses may increase. For example, we may need to take care of our parents. Repeat this calculation with new inputs each year!!

Screenshot of retirement calculator as a function of monthly expenses
Screenshot of retirement calculator as a function of monthly expenses

This is the origin of the “invest as much as you spend” rule of thumb (for normal retirement) Download the retirement calculator as a function of monthly expenses. This sheet will work on all platforms – Google sheets, Mac Numbers etc.

In summary, do not ask “What percentage of my salary should I invest each month?”. Instead, ask, “What percentage of my expenses should I invest each month?”. The answer is bitter medicine – as much as possible, ideally as much as you spend! As discussed in this article – How should I invest to get Rs. one lakh a month pension? – one lakh “pension” is grossly insufficient and even for that, we need a couple of crores!



In an age of fake news and unstoppable social media, conspiracy theories are more appealing to the public than the complex scientific facts. The surreal butterfly effect that took a few days to change our lives in an apocalyptic way, from a Chinese man eating a raw bat to the supermarkets running out of every product, would undoubtedly be a place to so many dramatic explanations.



This conspiracy theory started by an anti-CCP documentary from the “Epoch Times” and spread by Donald Trump himself through the now-famous sentence “Ask China,” has led the two countries to a very delicate diplomatic situation, the worst ever.

This purely political misinformation has sure made its way to society, and people have found it more convenient to make some links that look obvious to them and find the supposedly missing piece of the puzzle. The geographic proximity of a lab where so many viruses are studied to the epicenter of the pandemic has formed a great starting point and a strong argument to the theory.

The fact is, the constitution in question is a Level-4 bio-laboratory, which means the precautions and the security are the highest they could ever get, so the odds of a virus escaping its walls are close to zero.



30% of Americans now believe that the virus was specifically made in China as a biological weapon. This social paranoia finds its roots back in January when Bill Gertz from Washington Times claimed that the start of the pandemic might have a link with the biowarfare program there; Steven Mosher added in February that the virus might have originated in a Chinese lab. Since then, the news has been the talk in every social network.

As much as it seems like a logical story and it’s easier to assimilate by the brain, all the scientific facts from independent studies all over the world and American military investigations prove that the virus is definitely zoonotic, which means it was coincidently passed to humans from animals.



Now that the virus has become a highly political issue, China couldn’t stay indifferent to all the claims it received, so they had to give their own version of the story as a response. As much as Trump is calling it the China virus, their ministry spokesman tried to label it as the American one through his Twitter account. The inculcation China is spreading is that the virus came with United States military members during the world games all the way back in October 2019.

Let’s move now from reasonable defamations to unconceivable stories.



Unfortunately, society is more likely to consider Billionaires as villains, no matter how much good to the world they do. As Bill Gates has been warning us since 2010 about an upcoming pandemic and urging the government to be prepared, hardly anybody listened. But as soon as the virus emerged, and the billionaire tried to help humanity by spending a hundred million dollars through his foundation and funding so many studies for potential vaccines, his old interviews emerged once again, and people claimed that if he knew the virus was coming, it could only be that he was the one creating it, all for economic reasons. Adepts of this theory are convinced that Bill Gates already had the cure to the virus even before we knew about it and that he’s about to earn millions through the shares he has in all those companies potentially involved in selling the cure.


If there’s something important we should learn from this catastrophe, it’s that as much as it looks real and appealing to the brain, we must stop the spread of those defamations from those who think they know better because they’re no other than an obstacle in the way of actual science, and a sometimes a huge delay in its agenda.

The situation we live in is as simple as it looks like, a sad but unavoidable global disaster that science has been apprehending for a long time.

The effect of Covid-19 on the U.S. Economy

The effect of Covid-19 on the U.S. Economy

As the novel coronavirus (COVID-19) rips through America’s biggest cities, its effect is being felt far beyond the over 140,000 Americans who are confirmed infected. The quarantines and lockdowns that are needed to fight the virus’s spread are freezing the economy, too, with unprecedented force and speed. The stock market has sunk a quarter from its peak last month, wiping out three years of gains. Last week, meanwhile, brought news that a record 3.28 million Americans applied for unemployment benefits, the highest number ever recorded. Unemployment is shooting up far faster than it did during the 2008 recession, a sign the economy is headed toward recession. How long is the COVID-19 slump likely to last?

To understand COVID-19’s hit on the economy, consider its effect on different industries. Consumption makes up 70% of America’s gross domestic product (GDP), but consumption has slumped as businesses close and as households hold off on major purchases as they worry about their finances and their jobs. Investment makes up 20% of GDP, but businesses are putting off investment as they wait for clarity on the full cost of COVID-19. Arts, entertainment, recreation, and restaurants constitute 4.2% of GDP. With restaurants and movie theaters closed, this figure will now be closer to zero until the quarantines are lifted. Manufacturing makes up 11% of U.S. GDP, but much of this will be disrupted, too, because global supply chains have been obstructed by factory closures and because companies are shutting down factories in anticipation of reduced demand. Ford and GM, for example, have announced temporary closures of car factories.

As businesses rack up losses due to closures, layoffs have already followed. Small businesses will especially struggle to keep staff on the payroll as their revenue slumps. Countries such as Germany are taking steps to help businesses avoid layoffs, and the United States would be wise to do so as well. The U.S. Congress has passed a massive stimulus bill that provides for hundreds of billions in new spending, expanding unemployment insurance and providing a cash handout to low and middle-income Americans, which should help laid off workers make ends meet until the economy begins to recover. The legislation also provides for $350 billion in “loans” for businesses, targeted at firms with fewer than 500 employees. These loans will be forgiven if firms don’t cut wages or lay off employees—so they function de facto like grants to businesses.

How far off is economic recovery? That depends, in part, on when the virus’s spread can be slowed and businesses can be reopened. President Donald Trump has suggested that the economy will be “raring to go” by mid-April. This looks unlikely. Judging by the progression of the virus in places like Italy, places in full lockdown such as New York are still at least two weeks away from when the COVID-19 deaths will peak. Yet, it is naïve to think that this is the point that life will return to normal. If businesses and restaurants are immediately reopened, then the virus will start spreading again. And some parts of the United States have not yet adopted the lockdowns needed to substantially slow the infection rate. Two months of lockdown looks more likely than two weeks. Most projections by public health experts suggest something similar is necessary to substantially reduce the virus’ spread rate. Italy, the European county that has suffered worst from COVID, has taken a month to reduce the death rate from infections, despite strict quarantines.

The best-case scenario is that the lockdowns bring down the COVID-19 infection rate and that testing capacity continues to expand. Suppose that America’s big cities emerge from their lockdowns later this spring. If so, will the economy pick up where it left off? That is far from guaranteed. Some purchases that were deferred during the quarantine will be made once stores are reopened. Yet, others will never happen.

One key risk is the number of businesses that are forced to close during the lockdowns. The more business closures—and the more layoffs that result—the higher the cost of the crisis will be. Unemployment will increase, and the higher it goes, the less likely consumption is to immediately recover after the lockdowns end.

The other major risk to the economy is that the health crisis is accompanied by a financial crisis. The immediate negative effect of COVID-19 on GDP is likely to be far more substantial than was the 2008 subprime crisis. The length of time that the COVID-19 crisis hangs over the economy will be determined by its financial effects. The 2008 crisis caused many years of slow growth because of the huge financial disruptions that resulted, as banks suffered losses and cut back lending—usually a key driver of growth—as a result.

It is easy to imagine ways that the COVID-19 crisis could have a similar financial effect. Businesses and consumers alike will default on loans. Financial markets are expecting the default rate of large corporations to increase, too. America’s banks are better capitalized today than they were in 2008—so they have more of a cushion to take losses. Yet, as losses pile up, government support may be needed to backstop credit markets again. The lesson of 2008, and of the Great Depression, is that the only thing worse than a bank bailout is a bank run, the costs of which are born not only by banks but by their customers. The Federal Reserve has already stepped in to offer additional liquidity to financial markets, but it may have to do more to keep credit available to companies and individuals.

It is possible to imagine scenarios in which the COVID-19 quarantines are followed by a swift economic recovery. The economy was growing steadily before the virus struck, so there are no other factors pushing. But the longer the shutdowns last, the less likely this becomes. More worrisome is that some state and local governments are only just beginning to take the risk seriously—thereby increasing the likelihood that the coronavirus spreads further, and requires longer shutdowns to bring it under control.

Financial Advisers Give Women Worse Advice Than Men, Study Finds

Financial Advisers Give Women Worse Advice Than Men, Study Finds

(Source: Bloomberg) — Women looking to manage their investments wisely now have another thing to worry about: whether the advice they are getting is biased. A two-year academic study covering every local financial-planning firm in Hong Kong found consultants frequently pushed women into chancier investments than they recommended for men with similar risk appetite.

“Advisers think they can fool the women and get away with selling them advice with sub-par results,” study co-author Utpal Bhattacharya of the Hong Kong University of Science and Technology said, suggesting that’s because they perceive women to be less financially literate than men. “This is what we call statistical discrimination.”

The motivation, the researchers suggest, is the financial planners saw an opportunity for commissions. The logic goes that women were less likely to be able to spot bad advice and more likely to buy products if the recommendation chimed with what they wanted to do anyway. It’s an attitude that could cost not only clients but backfire on the advisers themselves. A separate gender-bias survey from Bank of America Corp. recently found wealthy female investors who have negative experiences with their financial advisers are infact more likely than men to fire them. The researchers hired 32 mystery shoppers, half men and half women, to pose as potential clients in Hong Kong. Each was randomly alloted three traits: a high or low risk tolerance, a high or low level of confidence, and an inclination towards domestic or international investments.

Giving all participants such characteristics, which they were told how to convey to the planners, enabled the academics to control for reasons other than gender why varied advice may be given.

The results showed over a third of women (37%) were directed towards undiversified investments — such as individual stocks, complex insurance products and real estate investment trusts. Just 14% of men were funneled towards such risky strategies. Women were also advised to invest more in domestic assets than internationally compared with men. Sally Wong, chief executive officer of industry organization the Hong Kong Investment Funds Association declined to comment on the findings of the study.

Biotech: Two Key Takeaways From I-Mab’s (IMAB) Big News

Biotech: Two Key Takeaways From I-Mab’s (IMAB) Big News

I-Mab Biopharma (IMAB) announced two key pieces of news this morning.

First, the company has out-licensed the global rights for lemzoparlimab (TJC4), the anti-CD47 monoclonal antibody it has discovered, to AbbVie. In addition to tiered royalties that start in the low mid-teens percent if the drug makes it to market, AbbVie will pay I-Mab $200 million up front today, and potentially up to $1.74 billion more if certain development and commercialization milestones are met over time (in biotech we call these milestones biobucks because, while promising, it is not yet hard cash and there is no guarantee of success).

Importantly, I-Mab retains full rights to the drug in its home base of China, which is turning into a lucrative market for innovative medicines. Finally, AbbVie also has the right of first negotiation to in-license two additional lemzoparlimab based bi-specific antibodies discovered by I-Mab, which could bring up front minimums of $500 million each if they happen.

Second, I-Mab has announced a $418 million PIPE (private investment in a public equity) financing led by Hillhouse Capital, a top China based investment firm that is regarded throughout the world for dozens of prior successes such as Tencent,, and Zoom. Other investors in the PIPE include Avidity Partners, OrbiMed, Octagon Capital Advisors, Invus, Lake Bleu Capital, Perceptive Advisors, Cormorant Asset Management Sphera Healthcare and Alyeska Investment Group.

These are world-class life sciences investors and peers that I have the highest respect for. The money was raised at a $33 per share valuation (more than double the company’s January IPO value of $14 per share), and an additional $104.5 million could be coming I-Mab’s way in the future via warrants that have an exercise price equivalent to $45 per share.

I think there are two validating takeaways that investors can learn from this news.

China’s Biotech Sector is Starting to Produce World Class Science

Not a lot of people outside of Asia are aware of this yet, but there is a true biotech boom happening in China today. Until recently, China’s pharmaceutical market was almost entirely based on generic medicines because there was a lack of research and development (R&D) knowhow on the part of Chinese companies and newer expensive drugs could not be paid for in the past. This is changing rapidly as the Chinese government understands that biotech is a key component of the world’s new economy and that people today want the latest medicines for their families.

China has ambitions to become not just a prime market for drug commercialization, but to also be globally competitive in the development of new medicines. I think this is something that biotech investors must start paying attention to and learning about, as I believe it is one of the most important trends that will impact our sector over the coming years. To have such a large market come online and embrace science is a big deal.

The result of this boom is that literally thousands of biotech companies have been formed in China over recent years and we are starting to see compelling science come out of it. While once considered copycats, Chinese companies in biotech are starting to gain the attention of global leaders in the industry with their work. Recent examples include Johnson & Johnson in-licensing rights to a BCMA CAR-T therapy from Legend Biotech (LEGN), Amgen signing a global collaboration for oncology drug development with BeiGene (BGNE) and taking a 20% stake in the company, and Lilly licensing a neutralizing antibody asset for COVID-19 from Junshi Biosciences.

Today’s news is just the latest example. As I’ll describe below, the biology of CD47 inhibition is complicated and it is no small thing that I-Mab has discovered a differentiated approach that might turn out to be a best-in-class asset. AbbVie signing up to help develop this drug and agreeing to pay as much as they have on the financial side is a validation of the Chinese company’s science.

Takeaway #1: Biotech investors need to pay attention to these types of deals because they are a sign of things to come. China biotech is just getting started.

CD47 is a Top Target in Immuno-Oncology

Harnessing the immune to treat cancer has been one of the most important advances to come along in oncology in decades. While immuno-oncology checkpoint inhibitors like PD-1s have become the new foundation of care for many types of cancers, researchers have been working for years on finding the next important target in this space. Some people think the CD47-SIRPα pathway just might be it.

Sometimes called a tumor’s “don’t eat me signal,” CD47 is a protein found on many cancers cells that when interacting with the SIRPα receptor on a component of the immune system called macrophages, it tells them to not engulf the cancer cell and destroy it (a process called phagocytosis) as they would normally do. The idea behind a CD47 inhibitor drug is that it might block this cancer/macrophage interaction, thus allowing the macrophages to act naturally and help kill the cancer.

While this makes great sense in concept, the Achilles heel of the approach in the past has been safety. CD47 is also expressed on normal red blood cells (RBCs) and so by attaching to them, CD47 inhibitors have caused side effects such as anemia (a lack of enough RBCs to carry oxygen) and hemagglutination (the clumping together of RBCs)

I-Mab has worked hard to differentiate itself on the safety issue by discovering and developing a CD47 inhibitor that attaches to the cancer but does not attach as robustly to healthy red blood cells like we have seen in earlier attempts by some competitors. I met with the company shortly prior to its IPO in January and learned how they screened many antibody clones to solve this problem while paying particular attention to the crystal structure to find one that looked like it would have minimal binding to healthy RBCs.

That type of work is painstaking and is not as easy as it might sound. Less than one half of one percent of candidates made it through the screen. The candidate they eventually went with was validated by flow cytometric analyses in the lab by showing less binding to RBCs than competitors (source = SEC filings):

Binding of monoclonal antibodies

I-Mab also tested the candidate “in vivo” in non-human primates. They found less red blood cell depletion compared to other competitors and that was closer to a control group (source = SEC filings):

Hematological patterns in non-human primates

All in all, this is quality science I-Mab has conducted. What they have found through their diligent screening looks like a promising asset in the lab that might have advantages over others that have come before it. The next step was to test this hypothesis in humans, which they have been doing this year.

Earlier this week during the company’s Q2 quarterly conference call, executives suggested they have successfully dosed the drug without any major safety issues in an early human study. However, we have not yet seen the detailed data from this as it will be published at a future time.

The anti-cancer side of CD47 is not in doubt, the big question has always been safety. With that understanding, this is a space that has been heating up considerably lately and I expect there to be more deals this year. The excitement started at the beginning of 2020 when Gilead paid $4.9 billion to acquire a leading CD47 company called Forty Seven, Inc. I’m a big believer in following the money, and I thought at the time there was almost certainly going to be more activity and interest in CD47 when a company as sophisticated as Gilead was willing to write a $4.9 billion check as buy-in.

What was unique and scored Forty Seven the acquisition, in part, is that they got around the safety issue by using a creative dosing routine. Others were not as skillful and had problems in earlier studies. While those were a setback, I think it is reasonable to expect that it would only be a matter of time before others cracked the code on RBC binding either through more experienced usage or through better designed antibodies like I-Mab has done. The remainder of 2020 has been about various companies accruing data so that we can compare them and determine the relative differentiation.

Large companies have been waiting for that and I expect them to be armed for deals once they have enough data to make the call on which to move forward with. Today we have seen that I-Mab was the first to have enough quality data to get AbbVie to pull the trigger first. Other to watch in this space include ALX Oncology (ALXO), Trillium Therapeutics (TRIL), and the Hong Kong listed Innovent Biologics.

One dark horse I am following that is not on many investors’ radar yet is Zai Lab (ZLAB). Zai Lab is a China based company that has been known to license leading drugs from the West for development and commercialization into China. They have a great portfolio of assets like Glaxo’s PARP inhibitor Zejula and Novocure’s brain cancer treatment Optune, which are both now approved in China. What many people do not know or might not be focused on yet is that while Zia Lab has initially been focused on bringing licensed drugs to China, at the same time they have been quietly doing their own discovery work.

This is a very sophisticated company with an excellent leader in Dr. Samantha Du, I expect them to be a drug development leader one day. Earlier this year, Zai Lab quietly (without a press release) started a trial in the United States of its first internally discovered drug, which happens to be a CD47 inhibitor (ZL-1201). Dr. Du is one of the smartest entrepreneurs I have met in my travels to China and I am not surprised to see that her company has started out with an antibody in this compelling class. Their scientists have spent good time on this, and I am watching to see if it is potentially differentiated from the field like we are seeing with I-Mab.

Takeaway #2: CD47 is becoming a partnering and acquisition focus of large companies as second-generation products are designed to improve on safety while maintaining a strong anti-cancer effect. Watch for more deals in this space to come.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The Market is Sending Mixed Messages: What Should Investors Do?

The Market is Sending Mixed Messages: What Should Investors Do?

Yesterday morning, before all the action started, I wrote this piece, pointing out that the weekly unemployment claims number was a lot weaker than it first appeared, and that the negative pre-market reaction to what looked on the surface like a good number showed that the market understood this. There was a distinctly bearish tone to all that, but not even I expected to see this is the S&P 500 E-Mini futures contract once the main session got going:

E-Mini futures

That is a good old-fashioned selloff. The last time we saw a drop in the S&P of that magnitude was on June 11. Looking back, that big drop was an opportunity, so will this be the same? Or is it more like what we saw in late February, when a similar decline was the start of a major correction?


The two most important factors in making that determination are the cause of yesterday’s selloff and its nature.

Without the ability to read thousands of minds simultaneously, we cannot know the cause for sure, but the timing of it suggests that it was at least in part in reaction to those weak jobs numbers. As I pointed out yesterday, that was data for last week, whereas the much more encouraging monthly jobs report that came out this morning is for a period that ended halfway through last month.

Since that period covered by this morning’s data ended, we have heard in the Fed’s Beige Book that many regional Fed Chairs see weakness in their economies that sounds worryingly like it could be a lot more persistent than was first assumed. In today’s topsy-turvy world, of course, when that came out on Wednesday, the Fed’s gloomy take was seen by traders as increasing the chance of yet more stimulus, both monetary and fiscal, so it powered stocks to another new all-time high.

What we saw yesterday, though, was a reaction to data that seems to suggest that maybe the Fed is right, and that whatever they or Congress do, the economy is still suffering. Traders seemed to be finally acknowledging that maybe there will not be a sharp bounce back in the economy to match that of the stock market.

That is a worrying sign, but solace can be taken from the nature of the selloff.

It was focused on big tech names. That is not good for those for whom big tech comprises a significant part of their portfolio (a group that includes me, by the way) but in the grand scheme of things, it is actually a good sign. That is the area of the market that has shown the strongest gains for some time now, so selling there looks more like an overdue adjustment than a cause for major concern.

Ultimately, though, the real test of whether yesterday’s action is a small, temporary, needed correction or the start of a lasting period of volatility will come today. The reaction to this morning’s much more encouraging, if backward looking, jobs report has maintained the pattern of yesterday. Nasdaq is still down after the numbers, while the Dow is up. If that holds, then yesterday looks more like a technical adjustment than a warning sign. If, on the other hand, industrial, manufacturing and other more traditional sectors turn around as the day goes on, it would be a worry for the broad market.

On balance, then, right now it looks more likely that yesterday’s big decline in stocks was more along the lines of a short-lived, much-needed retracement than the beginning of a major correction. However, any significant selling during the day today would negate that view, and with a holiday weekend coming up, that could be a major risk. So, for now, I will be staying hedged and protecting against a bigger move.

In my case, that means a small short position in S&P 500 futures. That may not suit you, but even so, you might want to consider a small position in something that would benefit should the drop prove to have some legs, something like an inverse index or VIX ETF. That would have the advantage, not just of making money on the way down, but more importantly of making it easier to stick to your long-term investing strategy. Selling everything in a panic is a lot less likely when you can tell yourself you saw a drop coming and are making a profit somewhere.

As I said, the jury is still out on whether yesterday’s drop was an anomaly or a harbinger of doom, but for now, risking a small loss to protect against further declines look like a smart thing to do.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The Economic Impact of Oppression: How Much Wealth is Still Denied to Black Americans as a Result of Slavery?

The Economic Impact of Oppression: How Much Wealth is Still Denied to Black Americans as a Result of Slavery?

By Geoffrey Baron, Executive Director of

Shortly after the Civil War, William Tecumseh Sherman met with a group of Black American pastors and came up with a plan for reparations. Based on a pay of $20 per day since the 1700s, reparations would have worked out to be roughly 40 acres and a mule (roughly $2.7 trillion in today’s dollars). This plan had the potential to guarantee wealth for future generations to come.

While the plan for reparations was ratified by President Abraham Lincoln, after his assassination, President Andrew Johnson rolled it back immediately. Distributed land to Black Americans had been seized and given to former land owners, and calculations show the value of “what is owed” to former slaves and their families is between $2.7 trillion and as high as $90 trillion. This math also depends on whether you account for the socioeconomic damage and destruction brought onto Black Americans, or the countless trauma endured from over 400 years of murder, rape and oppression.

With years of devastating effects caused before and after slavery, it’s impossible to put a price tag on just how much is owed to Black Americans impacted by slavery. However, from ending systemic racism to recognizing wealth inequality, we can begin to pay back the trillions owed to generations of Americans impacted by slavery.

Black Americans were never given the opportunity to generate or accrue generational wealth

Had former slaves been given 40 acres and a mule the world would be a different place. In addition to a lack of paid reparations, the “Freedmen’s Bureau” was established to help freed slaves adjust and progress in a white society through education and training. At its peak, however, it had just 900 employees to serve four million freed slaves. This program was also gutted by President Johnson and other vocal Southerners who saw this infringing on “State’s rights.”

In short, President Johnson both rolled back the economic benefits of the freed slaves, and took away the boot straps they were expected to pull themselves up by.

To increase wealth disparities further, laws were passed making it illegal to be unemployed. Many former slaves ended up on chain gangs working back on the plantations they had been freed from.

From a lack of well overdue reparations to almost no opportunity for social growth, former slaves were left to fend for themselves with no education, in a society where they were generally looked over for even common laborer jobs. These horrible beginnings for freed slaves led to years of wealth inequality, giving generations of Black Americans little opportunities to independently accrue a substantial income.

Systemic injustices that historically kept, and continue to keep, Black Americans in poverty

Thanks to the Black Codes passed after the Civil War, Black entrepreneurs were charged $100 (roughly $2,000 in today’s dollars) to get a business license while whites were not charged.

In addition, laws made social security unattainable for the 70-80% of Black Americans in the South. Under the New Deal, Southern Democrats insisted, and succeeded, in having the laws helping impoverished Americans established by President Roosevelt be administered by individual states, which ensured Black Americans saw as little benefit from it as possible.

After returning home from fighting in WWII, Black GIs experienced continued discrimination. States and white financial institutions throughout America were left to run the veteran mortgage programs, which put over 1 million white GIs in houses and gave less than $100 to non-white GIs.

Very few Black GIs could afford college, and Southern universities flatly rejected Black applicants. Much of the massive racial wealth gap we see today ($17,150 median Black household income vs. $171,000 for white households as of 2016) can be directly attributed to the administration of the GI bill.

Long-established systems such as social security and welfare during President Roosevelt’s administration were meant to help struggling Americans, but left in the dust Black Americans who were still economically ravaged by the effects of slavery. These crucial economic systems that once discriminated against Black Americans caused a ripple effect that furthered wealth inequality into today’s world.

The benefit paying reparations has for the U.S. economy as a whole, not just Black Americans

In 2016, 27% of the Black population was living below the poverty line. The cruel irony is that poverty is expensive. Food stamps are not only demoralizing, they are a drain on the economy. Substance abuse goes hand in hand with poverty and all the collateral damage that comes with that, including crime. Taking millions of people out of the economy and putting them behind bars is a double whammy. Not only are we reducing our workforce, but also paying to care for the prisons and all of the logistics around that.

Instead, we need to invest in what we know increases productivity: Education, and the social programs needed to make that education a success, such as healthcare, mentoring, and so on. Not only is this good for the economy as a whole, it’s also the right thing to do.

If reparations could be made directly to organizations that have been combating the effects of slavery for years, this could potentially be a massive boon to the economy. This means less money would be needed for unproductive social programs such as rehab and policing that are merely addressing symptoms of systemic injustice. We could be flooding our work force with incredibly talented and creative workers, instead of building new prisons and inciting violence. It won’t be a quick fix, but even modest investment will begin healing and act as a stimulus.

Americans need to start paying reparations today

Nothing can truly every pay back the systemic racial divides, or physical and mental harm done to generations of Black Americans who still suffer the numerous injustices brought on by the U.S. never paying back reparations for slavery. America can’t rewrite history, but we can certainly influence our future.

Don’t wait to stop systemic injustice, and start paying back reparations that are long overdue for millions of Americans.

Geoffrey Baron is the Executive Director of, a non-partisan, non-secular organization encouraging voluntary reparations for slavery.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Crude Slips, Set for Biggest Weekly Decline Since June on Demand Worries

Crude Slips, Set for Biggest Weekly Decline Since June on Demand Worries


Energy stocks are higher, on a boost from the broader benchmarks, as US employment figures surprised to the upside.  Employment in the U.S. grew by 1.37 million in August, topping an estimate of 1.32 million.  Tech stocks remained under pressure which provided yet further support for energy stocks.  Trading is expected to be thin ahead of the holiday weekend in US. 

Oil held above $44 a barrel, recovering from overnight lows, but was on course for its biggest weekly decline since June as weak demand figures added to concern over a slow recovery from the COVID-19 pandemic.  “Despite the price gains today, which somehow smoothed the losses of the week, the bigger market picture is overall bearish sentiment that kicked off with lower gasoline demand reports on Wednesday,” said Paola Rodriguez-Masiu, analyst at Rystad Energy.

Natural gas was up sharply after snapping a 3-day skid yesterday following a historically bullish weekly injection report of only +35 Bcf, driven by strong power generation demand.


Reuters – Petroleo Brasileiro has concluded tests in a pre-salt exploration area called Jupiter on the Santos basin. Petrobras said the tests confirmed Jupiter’s “excellent productivity” potential as the field contains oil of “high aggregate value.”

Press Release – Subsea 7 S.A. announced an agreement with Petrobras to extend by one year the current long-term day-rate contracts for three pipelay support vessels (PLSVs) operating offshore Brazil. The extensions have a combined value of approximately USD 155 million, net of agreed reductions to the current day-rates, and increase the backlog relating to the four Brazilian PLSVs to USD 493 million at 31 August 2020.

Reuters – Repsol implements buy-back programme of up to 227.2 million euros and representing around 1.45% of its share capital. The buy-back programme will start on September 4 and will remain in force until December 18. The shares will be purchased at market price.

Reuters – Hungary will buy 250 million cubic metres of liquefied natural gas per year for six years from Royal Dutch Shell via Croatia’s LNG port in Krk, Foreign Minister Peter Szijjarto said in a Facebook post.

(Late Thursday) Reuters – Total restored the steam supply to its 225,500 barrel-per-day (bpd) Port Arthur, Texas, refinery on Thursday, said sources familiar with plant operations. The refinery is restarting the cogeneration unit that will produce about half the power the refinery normally uses, the sources said. Total expects it will take at least a week before the refinery has full power with the restoration of its external supply from provider Entergy.


(Late Thursday) Press Release – Occidental said that its Board of Directors has declared a regular quarterly dividend of $0.01 per share on common stock payable on October 15, 2020, to stockholders of record as of September 15, 2020.


Press Release – Baker Hughes announced that the Baker Hughes international rig count for August 2020 was 747 up 4 from the 743 counted in July 2020, and down 391 from the 1,138 counted in August 2019. The international offshore rig count for August 2020 was 184, up 1 from the 183 counted in July 2020, and down 60 from the 244 counted in August 2019. The average U.S. rig count for August 2020 was 250, down 5 from the 255 counted in July 2020, and down 679 from the 926 counted in August 2019. The average Canadian rig count for August 2020 was 53, up 21 from the 32 counted in July 2020, and down 89 from the 142 counted in August 2019. The worldwide rig count for August 2020 was 1,050, up 20 from the 1,030 counted in July 2020, and down 1,156 from the 2,206 counted in August 2019.

Press Release – PATTERSON-UTI ENERGY reported that for the month of August 2020, the Company had an average of 59 drilling rigs operating. For the two months ended August 31, 2020, the Company had an average of 59 drilling rigs operating. Average drilling rigs operating reported in the Company’s monthly announcements represent the average number of the Company’s drilling rigs that were earning revenue under a drilling contract. The Company cautioned that numerous factors in addition to average drilling rigs operating can impact the Company’s operating results and that a particular trend in the number of drilling rigs operating may or may not indicate a trend in or be indicative of the Company’s financial performance. The Company intends to continue providing monthly updates on drilling rigs operating shortly after the end of each month.

(Late Thursday) Press Release – Thermal Energy Partners and Schlumberger New Energy, a new Schlumberger business, announced the new company name, GeoFrame Energy, a geothermal project development company. GeoFrame Energy will leverage its partners’ expertise to develop efficient and profitable geothermal power generation projects, providing an opportunity to support a reliable supply of clean energy.


(Late Thursday) Press Release – Pembina Pipeline announced that its Board of Directors declared a common share cash dividend for September 2020 of $0.21 per share to be paid, subject to applicable law, on October 15, 2020 to shareholders of record on September 25, 2020. This dividend is designated an “eligible dividend” for Canadian income tax purposes. For non-resident shareholders, Pembina’s common share dividends should be considered “qualified dividends” and may be subject to Canadian withholding tax.


Futures contracts tied to the Dow Jones Industrial Average jumped on Friday after the release of U.S. employment data for August.  Dow futures traded 200 points higher, or 0.7%. S&P 500 futures were up by 0.3%.  The U.S. unemployment rate fell to 8.4% last month from 10.2% in July. Economists polled by Dow Jones expected the rate to decline to 9.8%. As for overall jobs creation, employment in the U.S. grew by 1.37 million in August, topping an estimate of 1.32 million. 


Nasdaq Advisory Services Energy Team is part of Nasdaq’s Advisory Services – the most experienced team in the industry. The team delivers unmatched shareholder analysis, a comprehensive view of trading and investor activity, and insights into how best to manage investor relations outreach efforts. For questions, please contact Tamar Essner

This communication and the content found by following any link herein are being provided to you by Corporate Solutions, a business of Nasdaq, Inc. and certain of its subsidiaries (collectively, “Nasdaq”), for informational purposes only. Nasdaq makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Sources include Reuters, TR IBES, WSJ, The Financial Times and proprietary Nasdaq research.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Top Five Smartphone Companies in the World

Top Five Smartphone Companies in the World

A smartphone, when you think about it, really is an incredible item. It combines the functionalities of many things into one: a phone (yes, you can still use them to make calls), a camera, a calendar, a purse, a diary, an alarm clock, a photo album, a book, and so much more. It’d be harder to come up with things smartphones can’t do than what they can.

All this is to say that the smartphone market is a competitive space with companies working on secure, user-friendly, and innovative devices to garner consumer interest and market share.

The global smartphone market has moved from a high growth phase (experienced few years ago) towards a phase of stabilized long-term growth. Majority sales in developed countries are now being generated from upgrades to a better device rather than first-time buying. Instead, you can find first-time buyers in emerging markets.

Back in 2016, Gartner said, “The double-digit growth era for the global smartphone market has come to an end.” The global smartphone market grew by 2.7% and 1.2 % in 2017 and 2018, respectively, followed by a 1% decline in 2019 (some estimates suggest a 2% fall).

The COVID-19 pandemic, and its effects on the economy and movement of people, lockdowns, and point-of-sale closures, have further put pressure on the smartphone sales. The smartphone market shrunk around 16–20% during Q2 2020 based on varied reports and is projected to decline 9.5% year-over-year in 2020.

When you look at the smartphone market, one incredible statistic comes up: the top five companies hold close to 65% of the market share. Here are those companies, and what they’re up to:

1. Samsung (SSNLF), the South Korean conglomerate, ruled the worldwide smartphone market for years with wide margins. With increasing competition from peers, its market share began to decline. It peaked during 2013 at 31% and was reported at 19.2% in 2019. Samsung experienced a 22% fall in shipments year-on-year, although it dominated close to 19% of the market share in Q2 2020.

Samsung’s market share in India—the world’s second largest smartphone market—was 26% in Q2 2020 (up from 23% in Q2 2019). Samsung is a popular brand in the U.S. and captures one-fourth of the market but is barely 1% of the Chinese market. Samsung plans to unveil new flagship smartphones, including the Galaxy Note and a foldable phone.

Its second quarter earnings press release read, “As for the second half, the number of 5G subscribers and launches of mid- to low-priced 5G smartphones are expected to increase while adoption of high-resolution and triple and quad camera for mobile devices is expected to grow.”

Samsung is the largest non-U.S. spender on research and development with $17.32 billion in 2019.

2. Huawei has challenged Samsung’s supremacy in the smartphone market in a short period of time. In 2015, Huawei joined Nokia, Apple, and Samsung to become the fourth mobile company to ship over 100 million smartphones in a year; its shipments in 2015 were at 106.6 million. Huawei has created a niche for itself, especially in emerging markets through its affordable price range, moving up from a 3% worldwide market share in 2011 to 15.6% in 2019.

Estimates by IDC suggest that Huawei topped the chart with its market share at 20% (Samsung at 19.5%) in Q2 2020 while Gartner reported a 18.4% and 18.6% market share for Huawei and Samsung, respectively.

Huawei dominates the Chinese smartphone market with a 47% market share and 60% of Chinese 5G smartphone market. Huawei believes that, “Innovation has been the very foundation for its survival and growth over the past 30 years.”

The company continues to invest in future-oriented, cutting-edge technologies and basic research, with an annual investment of $3 billion to $5 billion. Huawei has already embarked on 6G research.

3. Apple. While most smartphone manufacturers witnessed a fall in shipments, the demand for Apple’s (AAPL) most important product showed resilience amidst the global pandemic and recession. During Q2 2020, Apple captured 13% of market share while it experienced a 2% growth in revenue from iPhone, which was reported at $25.41 billion for Q3 FY2020 (April-June).

The iPhone 11 witnessed a continued momentum in growth and a good start of the iPhone SE, which is a more budget-friendly variable of the iPhone. During the Q3 FY2020 earnings call, CEO Tim Cook said that latest survey of consumers from 451 Research indicates iPhone customer satisfaction of 98% for iPhone 11, 11 Pro, and 11 Pro Max. Apple spent $16.21 billion on R&D in FY2019 and has spent $13.77 billion during the first nine months of the ongoing FY2020 (October–June).

Reports suggest that Apple has asked its suppliers to build at least 75 million 5G iPhones for later this year. Apple shipped around 69.55 million devices in Q42019 and a total of 193.47 million in 2019 (12.6% market share). To strengthen offerings, the company made a $1 billion acquisition of Intel’s smartphone modem business. Apple dominates the U.S. smartphone market with a 46% share.

4. Xiaomi, based in China, is currently the world’s fourth-largest smartphone brand. In its initial years, it was hugely dependent on the Chinese market for its growth. However, it expanded rapidly in the past decade and has presence in more than 90 countries and regions around the world. With a sale of 70 million handsets in 2015, Xiaomi’s worldwide market share was below 5%. Today, it captures close to 9% of the global market, having shipped 126.05 million devices in 2019. Xiaomi is the market leader in India with an approximately 30% share. The company’s Q2 2020 global shipments stood at 26.09 million.

5. Oppo takes the fifth spot with around 118.69 million shipments in 2019 and a 7.7% market share. During Q2 2020, it shipped 23.61 million devices (a decline of 20% year-on-year), capturing 8% of the market. Oppo is closely followed by vivo. Over the years, these two brands have shown decent growth from under 5% market share in 2015. Oppo and vivo both dominate around 16% of the Chinese market each while in India, vivo scores above Oppo.

Going forward, the smartphone market is expected to witness intensifying competition amid a gradual recovery in demand and the roll-out of 5G devices.

Disclaimer: The author has no position in any stocks mentioned. Investors should consider the above information not as a de facto recommendation, but as an idea for further consideration. The report has been carefully prepared, and any exclusions or errors in it are totally unintentional. All facts and figures based on reports from IDC, Gartner, Canalys and Counterpoint and company financial statements. Apple Financial year: October – September.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Setting Your Quality Life Purpose

Setting Your Quality Life Purpose

More and more these days I’m asked my thoughts on the meaning and quality of life. This global pandemic, including being on social lock down, has caused individuals to have deeper discussions.

Many of us agree that we were having these “life” discussions when we were in college, newly married or considering our career choices. Now as adults facing so much uncertainty in the world, we are returning to these life-shaping talks to review or audit our lives, evaluating where we go next.

Golf and revelations

I recently received an invitation to attend a golf lesson event via video conference being hosted by a financial planner. This was too random not to attend. But before the event I spoke to the host who told me that he was looking for innovative ways to stay connected, not just with friends but also with clients. So he hired a golf pro to demonstrate not only golf swings but also to give tips on how to “read” a golf course.

His intention was to bring together key people in his life who he knew were having similar life discussions, but not just to talk, but to do and enjoy something together. In this case golf.

He went on to tell me that, over the past three months, he had come to the realization that he was spending far too much time working, building wealth and growing his businesses, and too little time with his family.

Appreciating how many of his early life values were being compromised troubled him, he dug out an old journal from his youth to read. Years before he had written on the first page:

  • I will always be able to articulate my purpose.
  • I will endeavor to have balance in key areas of my life.
  • I will live with purpose and intention.
  • I will responsibly attend to my wants and needs.
  • I will have a plan for giving back to the community.
  • I will be a present and responsible head of my family.

These statements were guided by the values, goals and socio-cultural context in which he lived. Knowing that he had moved so far away from them was troubling.

A season of revitalization

After the Zoom golf lesson ended, the ten attendees talked about this being a season of revitalization for them. They talked about catching a new vision for their lives, for their businesses, yet all agreed how far they had drifted from their quality life purpose and plans and how important it was for them to re set their life compass.

Interestingly, we all shared news about the video conferencing events we’d been invited to. Golf was obviously of interest to us as golfers and was a small step toward refocusing our quality life. Even as we talked and laughed about the video conference events we’d been invited to (learning to cook, attending a music recital, exercising at home, portrait painting, dress making), it led us to question what would people in our personal and business world want to be invited to? Clearly not all of us would be interested in such video conference invitations.

What kind of events would we run that add meaning to life? More importantly, how would we even know what quality life and meaning looked like in the lives of those people if we didn’t know them at a deeper level.

This led to a wider conversation. Given that many people were having profound and meaningful conversations and looking at their lives through a completely different lens, how could we work with them or their clients to ensure our service offering genuinely added value to their quality and life goals?

Further, how would we know what those were? As a group we’d forgotten or laid aside our own quality life purpose to some degree. So, how then to now engage with family, friends and clients to understand and gain insight into what a quality life looked like for them?

‘Money Confidence’ is a key

From my own perspective I’m already seeing investors keen to understand their financial personality as they make potentially life-changing decisions. They clearly see how understanding their financial personality will build “money confidence” to make decisions that build a quality life performance in the areas of:

  • Life purpose
  • Career
  • Finances
  • Health and Recreation
  • Community
  • Relationships
  • Confidence
  • Wisdom

Over the next few months, I will unpack the importance of understanding how having a clear quality life purpose and plan can lead to significant money confidence. I hope you will join me on this journey that is at once both introspective and collaborative.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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