Weekly newsletter for women who want to be smart about money: financial news, personal finance and investing
Welcome to our #33 weekly newsletter in 2020.
Every week we curate key content and apply a female-lens so you can stay informed and inspired about money and investing.
Stay in the know.
Keep on top of global economic, financial and investing news and trends. And read about what this means for you and your money in 2020 during Covid-19 and beyond.
If you’re short on time, listen to the editorial on audio for a brief overview.
“Our mission is to help women take control of their financial future”
-Jana Hlistova
From The Purse…
Editorial from the Founder
Global stocks have hit a milestone: they are valued at more than 100% of global GDP. According to Warren Buffet, this is an indicator that stocks are in ‘bubble territory’.
China’s retail sales drop is fuelling concern about the global economic recovery even though China is the only major economy not in a recession this summer.
The UK fell into a recession in Q2, with a 20.4% decline in GDP-which is much worse than the US or the eurozone.
The FTSE 100 sank Friday: weeks of gains were wiped out due to the latest round of quarantine restrictions, poor Chinese data and a stalemate in the US stimulus package debate.
US retail sales is up but so is inflation, which according to Howard Marks, the billionaire investor, is a real risk to the US economy.
And as the combined balance sheet of central banks go up, so does bitcoin.
Read about how to recession-proof your money and we spotlight what a recession is and how it may affect you.
In the Have You Seen This Section?, we highlight a study by NOW: Pensions about single mums and why they have 88% of the pension men do.
And sexism in Silicon Valley is alive and well: Pinterest ex-COO, Francoise Brougher claims she was fired over sex bias complaint. Read about what happened on her blog. It’s worth noting that even her stock vesting schedule was different to her male peers.
Hmm, we’re not sure how we feel about Pinterest now.
Don’t forget to check out The Purse Podcast where I interview Jessica Robinson, Founder & MD of Moxie Future: we talk about responsible investing, why investing for impact is smart and how to start today.
Stay safe, look after yourselves and your loved ones.
I hope you enjoy this week’s newsletter. Until next week,
Jana
The Big Picture
Global markets and economy news, trends and indicators
The Coronavirus Effect:
Global stocks hit a milestone: 100%+ of global GDP (for the first time since 2018)
According to Warren Buffett, this signals stocks are in ‘bubble territory’.
This usually means it’s time to lean toward ‘risk off’.
China’s retail sales drop fuels concern for global economic recovery
Retails sales in July dropped by 1.1% (and for the 7th consecutive month).
Overall the economic rebound has been uneven: the supply-side production has rebounded faster than then demand-side.
China is the only major economy to avoid a recession.
Weeks of gains were wiped out due to the latest round of quarantine restrictions, poor Chinese data and a stalemate in the US stimulus package debate.
UK falls into recession: in Q2 declines 20.4%
Britain’s economy shrank by more than a fifth (Q2), much worse than the US or the eurozone. Why? Read this.
UK Chancellor, Rishi Sunak warns ‘hard times’ have arrived
The government expects the ‘economic pain’ to continue.
US inflation has risen faster than expected
Consumer prices jumped by 0.6% in July compared to June, pushing annual inflation up to 1%:
US retail sales rise for the third month in a row
In July, retail sales was up 1.2% vs the projected 2.3% (by Dow Jones economists).
However, the retail sales ‘bounce back’ has cooled as resurgence in Covid-19 infections has slowed reopening activities.
Bitcoin is on the up:
Negative real interest rates means investors are buying cryptocurrency.
The price of bitcoin is following the combined balance sheet of central banks:
Future Focus
Keeping an eye on key predictions, innovations and what’s going to impact the future
US: Howard Marks warns of long-term inflationary risk
The billionaire investor said that the Federal Reserve’s emergency relief funds helped the US economy avoid a depression.
However, we are likely to see inflation go up.
And another by-product may be a rise in zombie-companies; businesses which are saddled with enormous debt. They usually need to borrow money to service their debt and probably should go out of business.
US/global: George Soros says that the stock market is trapped in a Fed-fuelled liquidity bubble
The legendary investor said that the lofty stock valuations are ‘underpinned by hopes for another round of fiscal stimulus and the expectation that President Donald Trump will announce a reliable coronavirus vaccine before the presidential election’.
He also sees the US better equipped than Europe to deal with the pandemic economic fallout.
Your Money
Insights, trends and what this means for you and your purse
UK recession: how will it affect women?
Female-dominated industries have been hard hit
Higher unemployment for women in those industries
Women are more likely to be furloughed
The furlough scheme will come to an end in October
Note from The Purse: upskill where you can. Look into how you can develop your digital skillset and experience.
6 ways to recession-proof your money
Update your CV
Don’t panic about your pension (for now)
Check your emergency fund
Maintain a good credit score
Reduce your expenses
Sort your savings
Companies: winners & losers
Companies to watch and share price movements
Moderna share price surges 10%
The US government has reached a deal to purchase 100 million doses of the company's coronavirus vaccine.
This deal is worth $1.53 billion.
Daily Mail publisher cuts 100 of jobs as revenue falls
Quarterly print advertising down 69%.
Digital income is down 17% despite an impressive increase of well over a third in traffic to its main digital property, MailOnline.
Cisco has been Silicon Valley’s early-warning signal: its share price fell
This week the Cisco share price fell 11%; the worst 1 day drop in 9 years.
In the Spotlight
Is there a topic you'd like us to Spotlight? Please tweet @jointhepurse
What is a recession and how could it affect me?
The UK is in a recession for the first time in 11 years.
A recession is defined as the fall in Gross Domestic Product (GDP):
the value of goods and services produced falls (for at least two consecutive quarters).
The UK GDP fell by 2.2% in Q1 (January-March) and declined 20.4% in Q2 (April-June): the steepest fall on record due to the pandemic lockdown.
Some people, and mostly women, have lost their jobs, it may be harder to find a job and a pay rise may be difficult.
A recession is not felt equally across society; inequality is likely to rise.
For example, for homeowners who have a job, mortgage interest payments fell leaving them with more money in their pocket.
Public sector workers have done less well.
According to the Bank of England (BoE), the UK economy will grow again in Q3 (July-September). However unemployment will continue to rise as the furlough scheme ends in October.
Have You Seen This?
Female-focused news, reports, research, campaigns
Single mums retire on much less than other women
According to a study by NOW: Pensions:
They tend to be employed in low-paid part-time roles that fit around childcare.
Unless you earn £10k, you miss out on being auto-enrolled into a pension.
Single mums reach 65 with around £18,300 in private savings.
Other women retire on £51,000 and men on £156,500.
They are also worse off than divorced women, who end up with savings of around £26,100, while divorced men have £103,500 by the time they stop work.
Know this: saving for retirement is crucial. Knowing that you have enough saved up to retire on gives you peace of mind. Sit down and make a plan for what you have to do. Seek out a financial advisor or someone who can help you. If you are an employee, make sure you (at least) match your employer’s contribution. And if you are self-employed, you can set up a self-invested personal pension (SIPP).
Gender wealth gap is increasing during the pandemic
Sally Krawcheck, Founder & CEO of Ellevest has said:
Women have had to deal with a disproportionate amount of job loss during the pandemic because they're more likely to have jobs deemed ‘essential’.
They are also likely to experience micro-aggressions and misogyny even more during the ‘Zoom era’.
As a result, the gender wealth gap is accelerating.
Know this: we know it is difficult to save and to invest if you have lost your job or simply have less time due to childcare. However, as soon as you are in a position to start saving again, look into how you can make your money work for you. The time you put in today; the steps you take to invest for maximum return, will allow you to retire and live comfortably in later life.
Sexism in Silicon Valley: Pinterest ex-COO, Francoise Brougher is fired and she sues over sex bias
Brougher claims she was excluded from board meetings and eventually fired after she complained.
Brougher also said she was paid less than her male counterparts and was criticised for not being ‘compliant’ or ‘collaborative’ enough.
She also discovered, after Pinterest went public, that she was on an entirely different stock vesting schedule compared to her male peers.
Know this: this experience is common to women and minorities who do not have informal handshake relationships with their male colleagues and are regularly excluded from the rooms where decisions are made. It’s crucial to find an environment where you can prosper and grow. It’s not surprising we are seeing so many women ‘go-it-alone’ together. Whether this is starting a business or a venture capital fund; women are creating environments where they can prosper. And importantly, women are building environments where they can not be held back.
What We’re Tracking
Female-focused products or services, start-ups and businesses led by women, investment and research.
La Famiglia (Europe)-is a VC fund which invests in early stage B2B startups-founded by Jeannette zu Fürstenberg:
They have raised €50m and their backers include European industry behemoths like Mittal (the steel company), Pictet (the wealth managers), Oetker (of the baking goods) and Swarovski (the diamond business).
Money Habits of the Week
Do you have a money habit you would like to share with us? Tweet @jointhepurse
Did you know that ESG funds have outperformed traditional funds during the pandemic?
Look into ESG or responsible investing and research how you can get started online.
There are many online platforms and mobile apps you can easily access and invest with very little money.
Even if you invest £25-£100 a month, you’re more likely to read up on your investments and start learning as you go.
Listen to our podcast this week with Jessica Robinson who talks to us about responsible investing.
And don’t forget to tell us how you’re getting on @jointhepurse.
What We’re Watching
Greta Thunberg: is a Swedish climate change activist.
Watch the TED talk: in this passionate call to action, 16-year-old climate activist Greta Thunberg explains why, in August 2018, she walked out of school and organised a strike to raise awareness of global warming, protesting outside the Swedish parliament and grabbing the world's attention. ‘The climate crisis has already been solved. We already have all the facts and solutions,’ Thunberg says. "All we have to do is to wake up and change."
Coffee Break? Read This
We’d love to hear from you. Get in touch with Jana via the The Purse website or tweet @jointhepurse and @janicka.
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