The $70 Trillion Wealth Transfer (4 min read) This article discuss the estimated $73 trillion of wealth transfer in the US as baby boomers retire. Although this is a significant amount passing to heirs, research shows that only one in ten people typically receive an inheritance. Inheritances vary by income, with the top 5% of households getting inheritances 4 to 12 times larger than the bottom 80%. This transfer will also likely be slow, which would have less impact on equity markets than some assumed. However, it could affect the housing market by increasing inventory as older generations pass down homes.
Can BRICS dethrone the US dollar? It’ll be an uphill climb, experts say (7 min read) One of the main focus at the BRICS summit this week was on de-dollarization. The New Development Bank (NDB) which was formed by the BRICS have started to try reducing the US dollar dominance by issuing more loans in their nations’ currencies. Russia and China stated that this process is "irreversible" and gaining momentum as both nations seek alternatives to the dollar amid the tensions with the West. While the BRICS might even create their own currency, many experts still believes the dollar's dominance is likely to persist for the foreseeable future.
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Business & Stocks
Subway sandwich chain sells itself to private equity firm Roark Capital (2 min read) Roark Capital is acquiring Subway, ending the sandwich chain's family ownership of over 50 years and marking a new chapter for the struggling company. The deal, valued at around $9.6 billion, is a result of Subway's public sale process initiated in February. Roark Capital, which owns several restaurant chains including Dunkin', plans to keep Subway as a separate entity within its portfolio. Despite Subway's sales decline in recent years, its turnaround efforts have shown promise with a 9.8% increase in same-store sales in the first half of this year.
Dollar Tree’s shares sink as ‘challenging’ economy is pressuring discounter (3 min read) Dollar Tree's shares hit a 52-week low after the company reported that customers are focusing more on buying necessities like food, while skipping discretionary items. Other retailers like Macy's and Foot Locker have also noted a shift in this spending behavior due to rising interest rates and increased expenses. Dollar Tree is also facing challenges with profit margins as costs are rising and a surge of in-store thefts has impacted their inventory. All of this collectively sends Dollar Tree’s stock more than 10% lower despite Q2 earnings beating analysts’ estimates.
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Funds & ETFs
Luxury Goods ETF Bets on Bagging Hermes, LVMH Returns (2 min read) Thematic ETF issuer Roundhill Investments is launching the Roundhill S&P Global Luxury ETF (LUXX) to tap into the growth of global luxury goods sales. This ETF, tracking the S&P Global Luxury Index, features 80 of the world’s largest public luxury goods companies. It caters to the rise in affluent consumers driving the luxury goods industry's expansion, benefiting brands from different countries. With a focus on Europe but a strong record of outperformance, the fund is set to capitalize on a predicted 25% increase in the luxury consumer base by 2030.
Famed Investor Jeremy Grantham to Launch Firm’s First ETF (2 min read) GMO, the investment firm led by prominent investor Jeremy Grantham, is planning to launch its first ETF. According to the prospectus filing, the ETF will focus on investing in quality stocks in the US but other details such as the fee or ticker were not given at this point. GMO has a long history of offering mutual funds and the decision to create an active ETF is driven by the rising demand for this investment structure, which has continued to be more popular and taking market shares from traditional mutual funds.
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