Category: Stefan’s Weekly

Good Morning Ladies and Gentlemen

”Emotional intelligence is a crucial social skill for effective management.”

From old course materials from the University of Liechtenstein for the Executive MBA, which I completed a long time ago

Jackson Hole

The three-day Jackson Hole Economic Symposium, hosted by the Federal Reserve Bank of Kansas City, started yesterday in Wyoming, USA. The event brings together influential central bankers, finance ministers, academics, and financial market players worldwide. This year’s theme is “Reassessing the Effectiveness and Transmission of Monetary Policy.” I wonder what information we will receive from the weekend press from the event.

European Central Bank’s Path

I believe the European Central Bank should consider further lowering key interest rates at its next meeting on 11 and 12 September in Frankfurt, just one week before the Fed meeting in September. The slow economic indicators, particularly from Germany, the world’s third-largest economy, justify a rate cut in the current environment of consistently stable inflation. According to the minutes of the last interest rate meeting on 17 and 18 July, published yesterday by the European Central Bank, the upcoming September meeting is seen as a favourable time to reassess the extent of the current restrictive monetary policy. The minutes also state that “this meeting should be approached with an open mind,” which is hopefully common practice among central bankers.

FT Article on the Interventionism of the Swiss National Bank (SNB)

My friend, Freddie Hasslauer, recently penned a letter to the editor of the Financial Times, which was published a few days ago. In the letter, he delved into the success story of the Swiss central bank’s interventionism. I sought Freddie’s permission to share the link to the letter in my “Stefan’s Weekly,” and he graciously consented. You’ll find it particularly intriguing, especially if you typically oppose any intervention by central banks, as it offers an alternative perspective. Please enjoy the read: https://on.ft.com/3Xfycf3

Emotional Intelligence and Accountability

Ladies and Gentlemen, I am a little unsure and wonder whether, at the age of 61, I can maintain my conservative values or if I have to recalibrate them. I was taught as a kid by my parents, during many years on the job, and during multiple management courses many, many years, even decades ago, that emotional intelligence and accountability are crucial social skills for effective leadership. For the sake of it, suppose you were an experienced management consultant committed to sustainable corporate governance and communication who authored works on these topics. How would you assess a leader who lacks emotional intelligence, accountability and, possibly, emotional integrity? What key attributes define a great leader? Are qualities such as honesty, intelligence, integrity, and personal charisma still essential components of effective leadership today, or are they overrated? Are they just nice to have, or maybe even irrelevant, because other skills are more important? Again, just for the exercise, what qualities would you demand from a leader or even a global “Máximo Líder” if there was one, and if you had a say?

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“I did not need the special equipment. I’m a natural, natural shooter.“

Turkish shooter Yusuf Dikec, Olympics, Paris 2024

GDP Expectation

The Atlanta Fed’s forecast for the third quarter of 2024 (GDPNow) is 2.9%. A nowcast value of 2.9% means an increase of 0.4 percentage points compared to the previous week. The forecast has not shown any recessionary tendency so far. One could discuss an incipient US recession if the forecast falls into the 1% range. At the moment, things are moving in the other direction.
(Slide 1 (atlantafed.org))

Unfounded Recession Fears?

Strong petrol and car sales boosted the unexpected increase in US retail sales in July, surpassing market expectations. Additionally, a surprising decrease in initial jobless claims eased recent economic concerns among investors. Statements by US Federal Reserve representative Alberto Musalem (President of the Federal Reserve Bank of St. Louis) also suggested an ever-stronger perceived possibility of a turnaround in interest rates in September. Next to the good results from US giants Cisco and Walmart, it seems recession fears in the U.S. faded as quickly as they appeared two weeks ago, while hopes of lower base rates were presumed.

Commodities

As I suggested last week, commodities usually only outperform during perceived times of an economic upswing or a specific crisis. It’s always the same: people tend to feel inclined to call the macro environment with simple models or sophisticated models and still get it mostly wrong. The factors influencing the macro environment are diverse and multidimensional and change dynamically and often in different directions. How can anyone accurately predict the right direction in such an initial situation? That’s why I believe making investment decisions solely based on macro analysis is highly unsuitable. Not everyone will agree, but I seriously doubt purely macro-based investment strategies. At Incrementum, we prefer working with several specific scenarios and showing that if certain events occur, it may create one or the other investment opportunity rather than predicting one macro future.

What do I like in the Commodity Field?

Currently, I like crude oil, oil service companies, and electricity. Still, I avoid iron ore because I want to see an economic pickup in China or massively lower entry levels for the stocks on my radar. I am not investing in soft commodities due to my lack of expertise. And above all, I like companies that produce cash flows and are willing to share them with their investors. Cash flows are fantastic, no cash flows, no investment! Why crude oil? Because some great companies are producing massive cashflows, the U.S. Energy Information Administration (EIA) reports that current US oil production is at 13.2 million barrels per day, a level that has been consistent for several weeks. US inventories are nearing historically low levels. The August low in WTI Crude could be a significant low for the next few months, mainly because there is typically a seasonal rise in oil prices into October. After that, anything may happen, especially if winter is warmer than expected.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“One must beware of ministers who can do nothing without money and those who want to do everything with money.“

Indira Gandhi

Interest Hopes

Over the past few months, investors have been optimistic about declining interest rates. However, investor sentiment quickly worsened after the recent Fed meeting, during which Fed Chairman Powell indicated the possibility of an interest rate cut at the September meeting. Was this not what investors hoped to hear?

Recession Fears

The sentiment worsened due to unexpectedly poor leading indicators for the U.S. economy. The industry’s widely-watched ISM Purchasing Managers’ Index fell further into the contraction zone. Additionally, weak U.S. labour market data harmed the markets. In July, the U.S. economy not only created fewer jobs than anticipated, but unemployment reached its highest level in almost three years, with wage growth stagnating. This caused significant concern among market participants and heightened fears of a potential U.S. recession. It’s worth noting that in recent months, news of stagnant wages would have been well-received, as it would have signalled an end to the increasing wage-price cycle, potentially leading to lower inflation and raising hopes of an interest rate cut by the central bank, which was essentially announced for the September meeting.

It’s all about Perception

It’s all about perception! While numbers or actions may be well perceived at one moment, they may be perceived differently in a slightly different environment or context, combined with other data or actions.

Back Again

While writing this edition of “Stefan’s Weekly”, I would not be surprised if market participants looked back at last week’s and this Monday’s sell-off and realised they might have been exaggerating. This brings me to a topic I have been thinking about for a long time. Analysts, bankers, brokers, and journalists tend to echo each other. We often see similar comments and conclusions from apparently different sources in the media, on social platforms, and so on, especially when they concern “breaking news”. This is not only repetitive but also numbing. It is particularly concerning and potentially dangerous, especially when certain facts are taken out of context. Many analysts, bankers, brokers, and journalists have exacerbated the situation leading to this recent market correction with comments and puffery vocabulary. I cannot think much of that.

August Stats and Outlook

Since 1960, August has mostly been a positive month for the U.S. stock market, with a 0.1% increase. The performance was significantly more positive in election years, with a 1.4% increase. In 2022 and 2023, August showed a negative performance. However, the last election year, 2020, when President Biden beat President Trump, saw a strong August performance with a 7.6% increase. Let us see what August brings; today, it looks slightly better than after the hiccups in the first days.

Election Years Stats and Outlook

The stock market performance during the last year of a president’s first cycle in office shows a solid upward trend. This year, we already had a solid first half, mainly from seven stocks and also thanks to some sector rotation in Q2 and July. Let us see what the rest of the year brings.

Outlook and Commodities

Given the current state of decreasing and yet still sticky ongoing inflation, commodities present potential opportunities. However, the scenario could quickly turn if Western economies slip into a broad-based recession and China struggles to regain higher growth. Such a situation could swiftly and negatively impact the economic environment for commodities. There are always hopes that commodities can do well even during a recession, perhaps because of fear of underlying inflation, but this never really materialises. Again, I cannot think much of such a scenario. If you believe in a recession, you want to think twice about investing in commodities. If you think recession fears are exaggerated, commodities may be an exciting bet, even more so if inflation can not be tamed the way market participants hope.

My View

In my next “Stefan’s Weekly,” I will share my view on commodities. By the way, in my beliefs, gold is no commodity; it is money.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“Reason only makes sense in the context of irrationality; it’s not reasonable to always strive for rationality.”

from “unknown” to me

Compounding in Asset Management

The compound interest effect is a powerful strategy that can inspire us to leverage small, seemingly insignificant actions to generate significant gains in asset management. This phenomenon occurs when interest earns interest, leading to exponential growth in wealth. The initial capital grows by reinvesting dividends or interest income, generating more interest and creating a growth cycle. Unlike linear growth, where growth occurs constantly, the compound interest effect results in exponential growth. The longer the money is invested and the higher the interest rate, the faster the assets grow. Visualising this effect is like watching a snowball rolling down a hill – it starts small, but with each revolution, it gains size and momentum.

1. of August 1291

The Swiss National Day is 1 August. It commemorates the founding of the Swiss Confederation, which stemmed from the Federal Charter of early August 1291. Yesterday, we celebrated this significant day with a day off, delicious food, bonfires, and fireworks. It was a celebration that we all, as Swiss citizens, could partake in and enjoy!

Compounding in Society

Okay, Ladies and Gentlemen, let’s delve into the concept of compound interest in asset management, a strategy that uses small actions to generate significant gains. What if we apply this concept to society by working towards a sensible, respectful society that leverages small actions for significant gains? Let’s consider yesterday’s Swiss national, August 1st, and apply the philosophy of the compounding effect to Swiss society. It seems like our ancestors, over more than 700 years, leveraged seemingly insignificant actions for significant gains, and today, we live in a clean and prosperous place, in a direct democracy where decency and equality prevail. It has certainly been a long journey, but looking back now, we can’t help but feel proud and appreciative of our progress. As I mentioned above, “watching a snowball roll down a hill – it starts off small, but with each turn, it gains size and momentum”.

Compounding in Society II

The question that crosses my mind is whether the effect of compounding also works for negative actions. Unfortunately, I believe it does. Political debates, where political leaders call each other names, purposefully discredit each other, lie, and seemingly are unwilling to accept consensus and/or defeat, create negative momentum, which, in the end, is bad for society. We must take 100% responsibility for everything that happens to us, focus on decision-making and continuous improvement, and, as hard as it may seem, look down the road, drift away from instant gratification, and seek exponential gains by compounding small, seemingly insignificant actions.

The Paris 2024 Olympics

So far, so good. The Paris 2024 Olympics have started with an unbelievable artistic explosion. I had never seen anything like that and was impressed by the many different levels of creativity and art incorporated into the opening ceremony in the centre of the fabulous city of Paris. Obviously, not everyone was impressed, which is fine; it is almost impossible to meet everyone’s expectations. Let’s see how this further evolves.

Next Week

Next week we will try to see what is still in the markets for the rest of the year. Let me already add that from a purely statistical point of view, August is a good month during the U.S. election year.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“In the end, it’s not the years in your life that count; it’s the life in your years.“

Edward J. Stieglitz (commonly misattributed to Abraham Lincoln)

U.S. GDP versus German Consumer Confidence

This week’s US gross domestic product (GDP) numbers surprised to the upside, increasing by an annualised 2.8% between April and June. Experts surveyed by Reuters had only expected an increase of 2.0%. Those surprisingly strong figures for US economic growth contrast with the consumer sentiment in Germany, which has undergone an “interesting” development in recent months. According to the GfK Consumer Confidence Index, it stood at -21 points in June 2024. For July 2024, GfK forecasts a deterioration of -21.8 points. However, for August, “only” -18.4 points are expected. Germany has the third largest economy behind the USA and China, ahead of Japan.

September Interest Rate Cut

The ECB will cut in September; anything else would surprise me. The Fed, who knows? Maybe they will make a surprise move next week during the upcoming Federal Open Market Committee (FOMC) meeting scheduled for July 30-31, 2024. Else, a September cut is widely expected.

Inflation down the Road

However, in the long term and with an escalation of global trade conflicts, I expect a freshening breeze on the inflation front over the coming years. China is reaching the limits of its previous investment-driven growth strategy, but the government, just like the governments in Europe or the US, is avoiding painful adjustments. This will lead to tougher competition, and if Western countries push for higher tariffs at the same time, this will probably have an inflationary effect.  Perhaps this behaviour brings some industrial jobs back to America or Europe. Still, for most American and European consumers, life will become more expensive, as domestically produced goods in the U.S. or Europe will cost much more than comparable ones on the global market.

Spicy

Ladies and Gentlemen, we finally see some action in the American presidential elections. One old candidate is gone; perhaps the second old candidate will also hand over his baton to his nominated deputy. I think that would be a good thing for America. A breath of fresh air and fresh, younger people for an office that is probably one of the most demanding in the world seems to make sense to me.

The Paris 2024 Olympics

Ladies and Gentlemen, I expect the Paris 2024 Olympics to have a similar effect on the media than the European Football Championship. This means a welcome break from all the negative headlines we are usually inundated with.  Let’s hope for fair and conflict-free games in a spectacular setting.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“Learning and enjoyment are the secrets to a fulfilled life. Learning without enjoyment hardens. Enjoyment without learning stultifies.”

Richard David Precht

U.S. Inflation Expectation

Inflation in the USA is easing noticeably, fuelling the financial markets’ hopes of an interest rate turnaround in September. Last Friday, weak labour market figures reinforced the conviction in the US markets that the Federal Reserve will begin to cut key interest rates in September. The Atlanta Fed’s nowcast (GDPNow) describes the US GDP trend for the second quarter of 2024. The latest estimate fell to just 1.5%. This is the lowest estimate for Q2 2024 to date. Real US GDP growth in Q1 2024 was 1.4%. A 1.5% in the second quarter would mean that US growth for the first half of 2024 is below expectations of 2.0%. The 5-year break-even inflation rate currently stands at 2.22%. It is close to the level of the previous week. There are no signs of inflation flaring up again.

Department of Labour in Washington

Yesterday’s inflation numbers by the Department of Labour in Washington showed that the June inflation rate fell surprisingly significantly to 3% from 3.3% in the previous month. This represents the lowest reading in the current year. Economists polled by Reuters had expected a slightly higher figure of 3.1%. Even more noteworthy is the fact that June prices fell by 0.1%, while experts expected an increase of 0.1%.

September Interest Rate Cut

These numbers had an immediate impact on future markets. Following the surprisingly good data, the probability of a September interest rate cut by the US Federal Reserve is now estimated at 85%, up from around 70% just before the publication of the inflation numbers.

U.S. Interest Rates Development

The 10-year US yield already ended trading last week at 4.28%, thus below the 1-year moving average and the 200-day line. It not only closed the price gap but fell below it, which is a negative sign. (The weaker the US economy and US inflation, the more yields are likely to fall). However, Mr Powell did not indicate any immediate interest rate cut during his recent performance before Congress members. I suppose this will change in the near-term future.

UEFA EURO 2024

Ladies and Gentlemen, the European Football Championship is over for Germany and Switzerland. Hans and I will support Spain or England. Despite the elimination, I am happy about the Swiss team’s performance. For the last few weeks, the media over here concentrated on issues other than immigration and war thanks to EURO 2024, Switzerland’s good performance, and, again, at least here in Switzerland, Taylor Swift, who gave two apparently remarkable concerts. This was a fantastic and more than welcome break.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“I never won a fight in the ring; I always won in preparation.”

Muhammad Ali

Symbolic Politics in Asset Management

There are more styles in asset management than most investors anticipate. In principle, this is fantastic as it allows investors to choose the style of their preference or even to mix styles. The problem is that not all asset managers are equally loud when selling their case, and some asset managers act as if they have found the holy grail of asset management, which, of course, is absolute BS. Pardon my French! As I mentioned before, it almost seems that some asset managers are in a kind of religious war over the only true doctrine and insist that their view of the world and their investment approach is the only correct one; obviously, others claim the opposite. This leads to systemic entrepreneurial rivalry among banks, asset managers, analysts, etc., and I am not convinced this is only good for investors, as they may get carried away by hidden marketing in colourful brochures without really understanding the underlying concept. Unfortunately, the media plays along, especially if they get paid for it. This, Ladies and Gentlemen, is a genuinely aberrant development if you ask me.

Our Private Clients

At Incrementum AG, we are unwavering in our commitment to our clients’ understanding and satisfaction. We offer only one mandate style for private clients: equity-based and cashflow-producing. In every quarterly report to our clients, we reiterate the basics of our approach, ensuring that every single one of our private clients fully comprehends the concept. If our approach is not suitable for a client, we are dedicated to helping them find a more suitable solution at another bank and/or asset manager. Our clients’ understanding and satisfaction are at the core of our operations, and we value their trust in us.

Why are we doing this

Our approach at Incrementum AG is designed to avoid short-term tactical decisions. We believe that if our investors understand the concept, we are not forced to adopt such tactics to please clients in the short term. Instead, we can adhere to our well-founded and clearly defined investment approach without fear of short-term dissatisfaction. This approach not only makes sense for our clients but also for us, as it allows us to focus on the long-term strategy and the best long-term interests of our clients.

UEFA EURO 2024

Again, the European Football Championship seems to have succeeded. It still feels like a holiday from life and the daily flood of negative news that the media landscape of the past few years has produced. I am even happier than last week because Switzerland made it to the quarterfinals and will play England on Saturday. Hans is also super happy because Germany will play Spain this evening. Ronni, on the other hand, is disappointed because Austria was eliminated by Turkey despite having had much more ball possession and many more chances to score.

What we can learn from football

We have our own WhatsApp chat group among Incrementum AG’s partners. When Switzerland and Germany made it into the next round, we followed the matches and sent messages to support our respective partner’s teams. We cheered on our partners’ teams, were happy for them to win, and congratulated each other or, as was the case for Austria after the bitter elimination, tried to console Ronni. Emotions are important!

Muhammad Ali

What can we learn from Muhammad Ali’s “I never won a fight in the ring; I always won in preparation”? When choosing an asset manager, try to prepare yourself. Why not with the help of a decision-making matrix? (My kids would laugh because I always tell them to use a decision-making matrix for complex decisions, especially when choosing their partners). But I am convinced it helps Ladies and Gentlemen; if you think about your requirements, write them down and compare them to the offerings in the market. Like this, you may win thanks to preparation.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“Tis not unreasonable for me to prefer the destruction of the whole world to the scratching of my finger.”

David Hume

Bank of America monthly survey

Bank of America (BofA) delivers revealing data from monthly surveys among global fund managers. I like looking at those surveys and seeing these fund managers’ views on various topics. BofA’s latest monthly global fund manager survey shows a shift in fund managers’ preferences regarding global economic activity expectations. According to that survey, the “hard landing” camp is still in retreat, with only 5% of fund managers expecting a recession. However, the number of “no landing” supporters has also shrunk in the last two months, meaning that both the significant pessimists and optimists are on the retreat. The fund managers’ cash positioning stands at a mere 4.0%, while they keep an overweight in equities of 39%, which is as high as in Q4 of 2021. Noteworthy, I would think.

Risks according to the survey

Regarding the most significant risks, inflation remains the biggest concern for fund managers, although it is receding. Geopolitical concerns are in second place, and the US election is in third place. On the other hand, these concerns are on the rise. The US election in November 2024 is approaching and will be more prominent in the media in the coming weeks and months, and this influences fund managers’ (and all other people’s) thinking. As I mentioned in earlier editions of “Stefan’s Weekly”, I believe from a stock market perspective, there is little uncertainty for investors, as both US presidential candidates have already been in office for one term, and there is, therefore, little potential for surprises from a purely economic perspective. With regard to the second half of 2024, fund managers see Europe likely to perform slightly worse than the USA. The quintessence of stock market performance is a deterioration in economic activity.

UEFA EURO 2024

So far, the European Football Championship seems to have succeeded. It feels like a holiday from life and the daily flood of negative news that the media landscape of the past few years has produced with almost relish. I am happy that Switzerland is still in the tournament and will play Italy on Saturday. Hans is happy that Germany will go through to the next round as group winners and ahead of Switzerland. And Ronni is ecstatic because Austria is going into the last 16 as group winners in an adamant group with France, the Netherlands and Poland.

Wrong decision, or what we can learn from football

Ladies and Gentlemen, we are all human; we make mistakes, so this probably will not surprise you. In football, wrong decisions happen constantly, less today than before VAR, micro-chips in the ball, high precision cameras on drones, and all of those technical gadgets, but mistakes inevitably still happen. During and after football matches, there are discussions about off-sites, penalties, fouls, mistakes by referees, and you know what? This is fantastic because people are discussing, and even if they are not of the same opinion, with very few exceptions, they accept the result, take it from there and go on. This part of the game of football, which also involves wrong decisions, therefore has a not insignificant quality, and it is precisely this quality that can be found everywhere in life, both on a small and a large scale, and we maybe should, therefore not be tempted always to try to eliminate different opinions and equalise everyone and everything.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“You’ll never find a rainbow if you’re looking down.“

Charlie Chaplin

Update

Before all my readers go on vacation, I figured sending you an update on the Incrementum 2024 Year-End Competition would be appropriate. When I was writing this “Stefan’s Weekly”, the prices for the S&P 500 stood at 5’487.89 Points, for Gold at 2’355.48 and for Nvidia at 137.55 (after the 10 for 1 stock split).

S&P

So far, the highest bet on the S&P comes from Dario and stands at 5’651; Barbara’s bet is only one point behind 5’650 and the lowest at 4’000 and comes from Attila.

Gold

So far, the highest bet on gold stands stems from Hans at 2’500 and the lowest at 2’050.

Nvidia

Okay, Ladies and Gentlemen. Barbara’s highest bet on Nvidia is 1’250, and Adrien’s lowest is 195 a, and this was before the split. For me, almost anything is possible in this stock.

My bets         

I like to be transparent every year. However, I am not sure if I already let you know, so my bets are Gold 2’250, Nvidia 999, and the S&P 5’220.

Fingers Crossed

I keep my fingers crossed for all of you and look forward to sending this one-ounce silver coin to the winner at the end of the year.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 153
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li

Good Morning Ladies and Gentlemen

“If printing money would end poverty, printing diplomas would end stupidity.“

Javier Gerardo Milei

Your E-Mails

I receive more and more e-mails from readers asking where markets are heading. I personally believe markets are reasonably stable. I am not too afraid of an imminent market crash; inflation seems to be under control. Surprisingly, most companies we invest in for our clients report even better numbers than we expected, leading to a much-appreciated side effect of increasing dividends. So far, so good.

ECB

The first interest rate cut in years was much expected, and still, it was a cut. Some market participants will always see the glass half empty. The fact is that the ECB cut its base rates today by 0.25%.

Crisis

In financial markets, there is always more not-crisis than crisis. Why some investors gear their portfolios continuously versus “more crisis” is a mystery to me. We see constant political crises seemingly all over the place. I do not think this is going to disappear all too soon. But even in such political crises, many companies deliver positive cashflows, which investors can harvest.

War?

Currently, I am less afraid of a global war than I am of the effects of tariffs and sanctions. Tariffs and sanctions have a terrible impact on the global economy and global wealth and usually hurt large parts of a population rather than the people they are directed at.

Crash?

Do I see an imminent crash looming around the corner? No, I do not. Do I exclude a crash? No, of course not. Crashes are part of the game.

Political influence

Yes, Ladies and Gentlemen, politics may influence financial markets. However, this is primarily short-term for global markets. Politics usually have a very limited long-term impact on global markets as such, while local markets, i.e. like the U.K. ever since Brexit, may be hurt for quite some time. Furthermore, international companies as actors in a global marketplace prove to be relatively resilient as they can shift their businesses from region to region, perhaps losing market share for some time, operating on negative cash flow for a quarter or two, but surviving and prospering after a while in a new setting.

The U.S.

Am I afraid of the outcome of the U.S. presidential elections in Q4 2024 in regard to financial markets? No, I am not particularly afraid; I am fascinated and surprised to see that these are the best candidates the U.S. can produce and offer to its voters in 2024. Nevertheless, the U.S. is still a constitutional state with checks and balances, and therefore, I suppose there is no need to be exceptionally afraid.

Ladies and Gentlemen

As always, please share your opinion with me, but please do not forget (instead of hitting the reply button) to send your messages to smk@incrementum.li

Many thanks, indeed!

I wish you an excellent start to the day and the weekend!

Yours truly,

Stefan M. Kremeth
CEO & Head of Wealth Management
Incrementum AG – we love managing assets

Tel.: +423 237 26 60
Cell: +41 79 303 48 39
Im alten Riet 102
9494 Schaan/Liechtenstein
Mail: smk@incrementum.li