Tech Transformers: More Than Meets the Eye

There’s been so much news to catch up on this year that I recently caught up with Rupert Carlyon to compare notes.

Let’s start with Apple. New iPhone, same old story. Honestly, how “new” can it get? Not to mention, we’re looking at their fourth quarter of negative revenues. Then there’s Google, knee-deep in antitrust issues.

But the real talk of the town? NVIDIA. This is more than some Twitter rants—this is about CoreWeave, a company backed by Nvidia, eyeing a minority stake sale that values them up to $8 billion. But wait, key parties are from hedge fund backgrounds and insiders are offloading their shares? It makes you wonder if this tech rally is a house of cards, or are they just pushing the envelope because the opportunity is too lucrative?

New Zealand’s Economic Tightrope

It took a pandemic to facilitate the takeoff in the first place, so can the Reserve Bank of New Zealand really engineer a soft landing? We’re staring down the barrel of higher interest rates and an economy that’s treading water at best. PREFU says no forecasted recession, but that’s like saying you’re not drowning yet. Sure, we’re not sinking, but we’re not exactly cruising either.

Here’s the conundrum: higher inflation for longer or potentially widespread unemployment? Pick your poison. Both options sound like a rusty fork in the eyeball to me, but we’ve got to make a choice. Then there’s the elephant in the Uber China.

China’s Youth Unemployment: A Ticking Time Bomb

High youth unemployment isn’t just a stat; it’s a recipe for civil unrest. And guess who’s got a boatload of it? China. Let’s not kid ourselves; if China sneezes, we all catch a cold. Between deflation and their property crisis, China is like that friend who says they’re fine while their life is burning down around them. When they’re our biggest customer, and the biggest customer of our second biggest customer (Australia), we’re heading for fun time’s ahead. (And by fun I really mean sadness)

Interest Rates: The Harbinger of Reality

The U.S. is already coming to grips with ‘higher for longer’ interest rates, and now talk’s picking up of yet another rise. Considering the petro-dollar arrangement starting to form stress cracks and the war in Ukraine, something tells me we’re not out of the woods here. Is it a harbinger of things to come here in NZ?  Instability at the banking level, and tightening belts at home. No one’s immune here, but, this too shall pass.

Crypto: The Last Supper Before Retail Gets the Scraps

Let’s cap it off with crypto. All the big funds are diving in, yet we’re a conspiracy theorist for ‘going there’? Listen, a small allocation to bitcoin in particular is one of the best ways to increase returns without increasing risk (by much!). We’re talking Blackrock, Fidelity—the whole nine yards – they’re all getting in. Yet it’s not appropriate for retail investors? Why are everyday investors being left with table scraps? It’s one of the best-performing asset classes of my generation, and the pigs at the top want to have their fill before the rest of us even get a look in.

To Sum It Up

So, where does all this leave us? Tech giants are pushing boundaries, but at what cost? New Zealand’s economy is walking a tightrope, China’s issues are more than just their own, and the rise in interest rates is a writing on the wall. Lastly, crypto isn’t just for the wealthy anymore—it’s high time we all get a slice of that pie.