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A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web

I often read or overhear conversations blaming slow wage growth and economic equality on single factors, like robots or globalization, but a Wednesday research report from Deutsche Bank shows that the issue is much more complicated.

In a wonderful graphic from “Global Income and Wealth Inequality,” the firm’s research team cites five causes of widespread global inequality – technology, trade globalization, financial globalization, labor market flexibility (that benefits employers over workers), tax policies and education.

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I highly recommend readers take a close look at the whole graphic, but I’ll cite the explanation under “financial globalization” as particularly illuminating:

“[Foreign Direct Investment] and portfolio flows increase income inequality through concentration of foreign assets and liabilities in relatively higher skill-and technology-intensive sectors, pushing up demand for wages of higher skilled workers.”

“@SBarlow_ROB Deutsche Bank: Sources of inequality” – (graphic) Twitter

“@tanyatussing 2019 was a bad year for [U.S.] blue collar manufacturing — wages fell” – (chart) Twitter

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BMO economist Doug Porter published “Canadian Home Prices: We See Thee Rise,” describing what looks like a strong recovery in national home prices:

“The Canadian housing market continues to firm broadly. Unit sales popped 22% above year-ago levels in December, even as new listings faded a bit, tightening the market significantly. The ratio of sales-to-new listings now stands at almost 67%, the strongest since 2004 and tilting overall conditions pretty firmly in favour of sellers. Not surprisingly, prices are starting to roll higher as well. Make no mistake: we are still a long way from the wildly over-heated conditions of three years ago. Still, the quality-adjusted HPI is now up more than 3% y/y compared with small declines in the first half of 2019”

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“@SBarlow_ROB BMO: "Canadian Home Prices: We See Thee Rise"” – (research excerpt) Twitter

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CIBC economist apparently got up on the wrong side of the bed before writing, “Live Long .. and Prosper?,” published Thursday morning:

“An aging population that has cut into labour market participation, and lackluster productivity, has left real GDP per capita tracking at less than half its typical pace … 2019 was such a banner year across so many asset classes that pickings are likely to be slimmer in 2020… slower trend growth reduces the need for capacity expanding capital spending at any given rate of interest, thereby requiring a lower policy rate to get enough investment spending to recycle savings back into the economy… Disappointments in global growth in the first half of 2020 could also forestall a further rally in cyclically-sensitive commodity prices.”

“@SBarlow_ROB CIBC's Shenfeld must have been in a dire mood when he wrote this yesterday” – (research excerpt) Twitter

“The Problem of an Aging Global Population, Shown by Country” – Visual Capitalist

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Newsletter: “ Confessions of a TV-addict turned market strategist” – Globe Investor

Diversion: Street gangs and economic growth – Marginal Revolution

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