Table of contents for Issue 1295 in MoneyWeek

For someone who always trumpets his business credentials, Donald Trump doesn’t seem to mind a command economy – provided he is in command. In the past few days, he has proposed that credit-card interest rates be capped at 10% (the sort of policy that works about as well as rent controls – see page 8) and told the defence sector that it must cut back on dividends and buybacks and increase investment to beef up America’s defences (see page 6). He took umbrage when the CEO of ExxonMobil said he thought Venezuela was “uninvestable” following a call from the administration for $100bn to develop its oil industry. So he threatened to keep ExxonMobil out of the country to prevent it eventually profiting from the oil. And he has attacked the…

How did the protests start? They started with the bazaaris – the normally conservative Tehran merchant class who, two generations ago, were the financial backbone of the 1979 Revolution. On 28 December, shopkeepers in the capital’s Grand Bazaar went on strike in protest at the government’s handling of the nation’s collapsing economy – and their own inability to trade due to the volatility of the currency and inflation. Other businesses swiftly followed and protestors took to the streets in a wave of protest that rapidly spread to all parts of Iran. Thousands have since been killed in a brutal crackdown by the regime. After a year of economic crisis made worse by the wave of US and Israeli air strikes in the summer, president Masoud Pezeshkian had nothing to ease…

There have been no changes to our exchange-traded fund (ETF) portfolio since April, which is in line with our goal of changing it as rarely as we can. The portfolio has done what we want: it held up well during the US tariff shock in April (down around 7% at worst) and rebounded as markets rallied, ending the year up by 14.5%. We were helped by our 10% position in gold, which has been extremely strong, but also by better performance of the rest of the world versus America. Within the core equity part of the portfolio, we have equal amounts in the US, Europe, Japan and emerging markets. Implicitly, this means we are very underweight America (US stocks are about 65% of the MSCI ACWI global benchmark) compared with…

AI snaps at heels of Big Pharma EditorialThe Economist Development of medicines is “notoriously failure-prone”, with only 10% of drugs entering human trials making it to market, typically after ten to 15 years, says The Economist. This helps explain why the price tag of each successful drug is roughly $2.8bn. But an AI revolution is underway. Molecules designed by AI show an 80%-90% success rate in early-stage safety trials, compared with a historical average of just 40%-65%. Even if this success doesn’t repeat in later-stage trials, it will still have a huge effect. The technology is changing how the industry works. Pharmaceutical firms are forming alliances with AI-biotechnology companies and the technology giants. Big Tech is developing health spin-offs, too. For now, Big Pharma has “many clear advantages” – data,…

project-syndicate.org The lead-up to the announcement of Time magazine’s Person of the Year has always generated speculation, says Erin Lockwood. Last year’s outcome had millions of dollars riding on it. Punters placed $55m in bets on Polymarket and $19m on rival platform Kalshi. But Time’s result, “the Architects of AI”, sparked a furore as no one had anticipated the magazine’s exact phrasing. So should bets on Elon Musk and Jensen Huang pay out, or not? The controversy provides an important lesson on prediction markets. The markets have “soared to prominence” thanks to their reputation for “superior information discovery” – that is, for aggregating the common wisdom about what will happen and hence being better at making predictions than individual forecasters. But don’t forget that the events being wagered upon are…

The MoneyWeek investment trust portfolio was set up in 2012 with a simple principle: to help readers build a global, all-weather, set-and-forget portfolio. There have been a few changes over the years – the latest was the removal of Mid Wynd (LSE: MWY) in April 2025 after a manager change and a period of underperformance – but the goals have remained the same. Today, the portfolio contains Personal Assets (LSE: PNL), JP Morgan Global Growth and Income (LSE: JGGI), Scottish Mortgage (LSE: SMT), Caledonia (LSE: CLDN), Law Debenture (LSE: LWDB) and AVI Global (LSE: AGT). In 2025, an equally weighted portfolio of these six trusts produced a total return of 13.1%. By comparison, the Vanguard LifeStrategy 60% Equity Fund – a simple proxy for a 60/40 equity/bond portfolio – returned…

PayPoint is a household name across the United Kingdom and its yellow brand signs are a staple of the local corner shop. Most people recognise the company for its role in helping customers pay utility bills or top up pre-payment meters with physical cash. However, the business is changing as it moves away from its traditional roots toward a digital future. The company is offering other services in an effort to remain relevant in a digital world where cash use is on the decline. The shares’ high dividend yield is attractive to income-seeking investors. However, last year the shares were among the weakest on the UK market, which may present an attractive entry price. But buying is not without risks – the company has to manage its shift from cash…

With the FTSE breaking the 10,000 barrier at the start of 2026, it is hardly a surprise that my long tips continued to do well over the Christmas and New Year period, with four of the six appreciating. Telecoms firm Airtel Africa, rose to 367p, while Barclays climbed to 473p. Home-furnishings retailer Dunelm increased to 1,155p, while cryptocurrency Bitcoin advanced to $91,272. Solarpanel manufacturer First Solar fell to $242, while food-service distributor Sysco dropped to $75.01. Overall, the gains outweighed the losses, with the net profits on my long positions increasing from £2,829 to £3,570. In contrast, my four ongoing short bets have moved slightly against me. Self-driving lorry manufacturer Aurora Innovation rose to $4.72; electric-vehicle maker Faraday Future Intelligent Electric went up to $1.11; and datacentre specialist CoreWeave increased…

Many Britons will have started the new year full of good intentions about saving more for the future. And when it comes to paying more into your pension pot, that might not be as difficult as you think. Here are six simple ways to boost the contributions you’re making to your retirement savings. 1. Save your pay rise If your pay has just increased now that we’re into the new year, consider raising the proportion of your salary you pay into your pension pot at work. When you get a pay rise, your pension contribution each month will automatically increase in cash terms, since you’ll be paying in a percentage of a larger salary. But you can compound that positive effect by asking your employer to increase your percentage contribution…

We have two portfolios: one focusing on capital growth and one on income generation with potential for capital growth. For investors focused on the former portfolio, The Schiehallion Fund (LSE: MNTN) is a late-stage private-equity investment company managed by Baillie Gifford. The group has had a tricky few years as late-stage growth investing moved sharply out of favour. However, we now see clear “winners” of its investment approach, with some of its largest holdings, namely Elon Musk’s SpaceX (which comprises 14% of the portfolio) and digital acquisition-focused Bending Spoons (15%) achieving valuation levels rarely found in private equity. With the listings market potentially warming up once again, The Schiehallion Fund contains valuable assets that may potentially be revalued further into a listing on the public market. Meanwhile investors can access…

2014 Exton Park, Blanc de Noirs, 60 Above & 60 Below Prestige Pack, Hampshire, England £225, extonparkvineyard.com I published my Finest Fifty Wines of 2025 on my website on 1 January and, by coincidence, found myself opening a pair of wines the very same day, which I first mentioned in 2024’s Finest Fifty collection. The 2014 Exton Park Blanc de Noirs was bottled in 2015, and with seven years on its lees before being disgorged in 2022, this is an extremely grand English sparkling wine. When I first tasted it a couple of years ago, I found a glorious brittleness on the finish that reminded me of Exton Park’s sensational terroir and forensic winemaking. The fruit was evocative, impeccably drilled, and resplendent in the pinks and reds of wild-hedgerow fruit.…

The winter of 2024/2025 ran on for an unusually long time in the high-end art market, which really only woke from its hibernation as summer got going. In May, as the flowers were blooming, Alberto Giacometti’s sculpture Grande tête mince (1955), which had been valued at $70m, sent chills through the auction market when Sotheby’s found wealthy buyers were still sleeping. Then, the market woke up. In July, Canaletto’s Venice, the Return of the Bucintoro on Ascension Day (1730s) sold for £31.9m with Christie’s in London to set a new high-price record for the artist. It’s perhaps no coincidence that the summer was also when the stockmarket took off and as the year progressed, wealthy collectors didn’t look back (see right). Nine of the top ten most expensive artworks sold…

“We all know what to do,” Jean-Claude Juncker, the former president of the European Commission, once said, “but we don’t know how to get re-elected once we have done it.” The events of last year showed that he was wrong. Javier Milei was elected president of Argentina in 2023 on a radical free-market platform to resolve his country’s disastrous economic and monetary record. There followed a blizzard of measures of reform, deregulation and spending cuts, which, surprisingly quickly, yielded dramatic results: a collapse in the rate of inflation, a budget surplus, an economic boom and a sharp fall in poverty. But would he be rewarded politically? Against the expectations of the international media, his party won a decisive victory in the October congressional elections and he looks well set to…

Alphabet, the owner of Google, is as ambitious as ever when it comes to AI, says Hargreaves Lansdown’s Matt Britzman. It has just announced its Universal Commerce Protocol, built with “heavyweight partners” such as Shopify, Etsy, Wayfair, Target and Walmart. This aims to make AI‑powered shopping “smoother and more consistent” by letting users discover, compare and buy products directly inside Google Search and the Gemini app, with streamlined checkout options on the way. It’s designed to work across any AI platform, which shows that “AI‑led shopping isn’t a distant trend anymore – it’s just around the corner”. The ability to buy products that Google’s Gemini chatbot recommends, without having to leave the app, is a “big deal”, says Martin Peers in The Briefing. And while the move puts it in…

After 25 years of negotiations, the EU is due to formally sign a landmark trade deal with the four members of the South American Mercosur trade bloc: Brazil, Argentina, Uruguay and Paraguay. European Commission president Ursula von der Leyen is heading to Paraguay to sign the treaty. If ratified, the free-trade zone, home to more than 700 million people, would be one of the largest in the world, says European Newsroom. It could increase EU exports to Mercosur countries by up to 39% (€49bn) and support 440,000 jobs across Europe. Von der Leyen says the deal, which was given “new momentum” last year after the EU’s trade dispute with the US and continuing trade tensions with China, sends a strong message about the EU’s commitment to diversify trade and…

It is a bizarre legal action. Jerome Powell, the chairman of the Federal Reserve, the US central bank, has been prosecuted over renovations of the Fed’s headquarters and may now face criminal charges. Given that it manages an economy worth $30trn and the world’s reserve currency, it is hard to see that the $2.5bn spent on improving the Fed’s offices really matters much. Even so, Donald Trump has clearly decided to use it as a weapon for a full-scale assault on a Fed chairman he would prefer to get rid of. Powell himself was clear that the legal attack was just a way of bringing the Fed to heel. “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of…

Exchange-traded funds (ETFs) are bought and sold on a stock exchange in the same way as you would trade normal shares. Unlike investment trusts, which are also traded on exchanges, ETFs are mostly (although by no means all) passively managed. This means their aim is to track the performance of a particular market, rather than beat it, as an active fund attempts to do. Also unlike investment trusts, the net asset value of an ETF should not diverge from its share price, barring extreme circumstances. ETFs are available on a range of indices, sectors, themes and commodities, and index providers constantly launch new indices for them to track. Given their largely passive structure, ETFs tend to have lower fees than active funds, and rampant competition between providers has driven prices…

“Thank you for not making me pay you $1,865,986 after I kept losing at cards on double or quits when I was eight years old.” Broadcaster Gabby Logan (pictured) pays tribute to her father, footballer Terry Yorath, following his death, quoted in The Mail on Sunday “The world is not driven by greed. It’s driven by envy.” Berkshire Hathaway’s former chair, Charlie Munger, quoted in The Knowledge “Live in such a way that you would not be ashamed to sell your parrot to the town gossip.” American actor Will Rogers, quoted in The New York Times “Tell us about the legal system, tell us about the political system. Tell us about the economic system and about the contractual and fiscal systems, and tell us about arbitration. And tell us about…

theconversation.com Bad days at work can leave you feeling tired and drained, says Ioannis Kratsiotis. Good days leave you feeling lighter and more energised. The good days are not necessarily defined by “big wins or major achievements”, however, but come from “harmonious experiences” that support our basic need for autonomy, competency and connection. You can “create better days” for yourself and your colleagues with these five simple suggestions. First, ask for help and offer it in return. Even small interactions to this end help you feel connected and supported. Second, recognise “small wins”. Notice what went well and the tasks you made some progress with. Third, give yourself and other people space. A “sense of freedom… plays an important role in our mood”. Fourth, reach out to others before the…

One potential driver of the renewed interest in forestry investment is the recent government U-turn on business property relief (BPR) and agricultural property relief (APR). This will enhance the appeal of forestry as a tool for families planning for inheritance tax (IHT). The two reliefs work in the same way, allowing the owners of a wide range of business assets to pass these assets on to their heirs with no liability for IHT, as long as they’ve owned them for at least two years on death. In her first Budget, in the autumn of 2024, chancellor Rachel Reeves unveiled reforms of BPR and APR; from April 2026, she announced, only the first £1m worth of assets would qualify for the reliefs at 100%, with any excess getting only 50% relief.…

Herald Investment Trust is to make shareholders a tender offer for up to 100% of their shares at close to NAV, with the aim of getting activist investor Saba Capital to cash out its stake, after the US hedge fund twice tried to oust the board. The specialist in smaller technology companies is launching what it calls a “decisive” two-stage plan, which is initially conditional on Saba tendering “materially all” of its holding. If Saba instead blocks the tender – which it is able to do since it holds more than 25% – Herald will initiate a “backstop tender offer” on terms that cannot be blocked by Saba so that shareholders will be have the option of receiving a cash exit rather than remaining in the trust if Saba eventually…

One of the recurring themes of this column is that some of the best opportunities are provided by firms in industries that aren’t glamorous, but are important. One industry that certainly fits the bill is pest control. If you run a restaurant, you’ll know how vital pest control is to your survival, as no-one wants to eat in a place with flies in their soup – or worse. Similarly, as emerging markets become richer, and people move into cities, their tolerance for pests dwindles. One company perfectly positioned to take advantage is Rentokil Initial (LSE: RTO). Founded in the UK just over 100 years ago, Rentokil dominates the UK market and has expanded overseas by acquiring companies in other countries and integrating them into the Rentokil brand. The most notable…

Millions of pension savers struggling with retirement planning should be able to get more help from their pension providers from April. The Financial Conduct Authority is set to launch a new regulatory regime, known as “targeted support”, with Parliament poised to pass the legislation enabling the shake-up in the next few weeks. Currently, strict rules on financial advice prevent pension providers making specific suggestions to savers about issues such as how to turn their savings into retirement income. The rules, introduced more than a decade ago, were supposed to encourage savers to get independent financial advice, rather than support from product providers. In practice, however, the high cost of independent advice has put millions of savers off; instead, they’ve been forced to make difficult pension choices without any professional support.…

Spina, a ten-month-old lagotto romagnolo, sniffs the autumn air. She has been brought to these woods on the Castiglion del Bosco, A Rosewood Hotel estate in Tuscany to do one thing – find truffles. Let off the leash, she in fact proceeds to do many things. She darts from person to person in our truffle-hunting pack, she hurdles a tree root almost as big as herself and then runs back to her handler for a treat. Too soon, Spina. You must first find the truffle. “No, Spina, vai, vai!” The young dog remembers her training and her little wet nose, not unlike the truffle she seeks, scans the forest floor strewn with golden leaves, the green moss-covered rocks and the trees. It is pleasant to be out this morning, the…

Going… Italy’s prime minister Giorgia Meloni had planned to sell the gifts she has received from foreign leaders at a charity auction – among them a figurine from president Javier Milei of Argentina of himself wielding his trademark chainsaw and a gold and citrine quartz necklace from Uzbekistan’s president. Italian law prohibits her from personally accepting items valued at more than €300, so the gifts, valued at a combined €800,000, are kept in a secure room at Palazzo Chigi in Rome, says Politico. Meloni had planned to auction the gifts through Rome-based Bertolami Fine Art, only to call off the plans when the auction house was investigated for alleged trafficking of archaeological artefacts. Gone… US president Donald Trump sold a portrait of Jesus Christ (pictured left) for $2.75m at a…

Shares in US defence companies rallied after president Donald Trump called for a $1.5trn defence budget, say Caitlin McCabe and Drew FitzGerald in The Wall Street Journal. Such a sum, which Trump claims is necessary “in these very troubled and dangerous times”, would be over $500bn more than the Pentagon’s expected budget this fiscal year. But while such a move should boost firms’ bottom lines, it wasn’t clear “what would be funded, how... or if Congress would be fully onboard”. What’s more, the sector had already been “dinged” by an executive order from Trump that “US defence companies couldn’t issue stock buybacks or dividends until they accelerated military-equipment production”. Experts are already warning that Trump’s “sweeping order” for US defence companies is “fraught with risk”, say Sylvia Pfeifer and Christian…

● Be glad that Associated British Foods (ABF) hasn’t yet split its “go-getting” Primark clothing retailer from the more volatile food businesses, says Nils Pratley in The Guardian. A standalone Primark might have seen a bigger share-price hit than the 14% fall that ABF suffered after a recent profit warning. Weaker European sales may reflect a soft consumer environment, but one has to wonder if “the buzz around the brand has faded” or if competition from online retailers is heating up. Analysts still expect Primark to make £1bn operating profit this year, so “this is far from being a crisis”. But ABF should “avoid distractions for a year or two” and focus on Primark’s long-term prospects. “Demergers work best when there is obviously value to unlock.” ● British Land CEO…

Signs of “extreme late-cycle” behaviour are evident in a “frothy” market, says Rajiv Jain, the co-founder of US investment management firm GQG Partners. Capital expenditure (capex) on artificial intelligence and data centres is increasingly financed by large amounts of debt. Equity valuations are high, and there is uncertainty about risk and geopolitics. “We see significant downside to the market,” Jain tells Barron’s latest roundtable. A significant portion of earnings growth is being driven by growth in capex. If Microsoft boosts capex, that expense gets written off over many years. “But it shows up in revenue and earnings almost immediately at Nvidia, or Broadcom, or Amphenol.” However, the rate of growth of capex probably peaked in 2025 and current trends look unsustainable, says Jain. Amazon’s capex is on track to be…

capx.co Following the “year-long gloom fest that was 2025”, some commentators have urged us to cheer up, says Joseph Dinnage. After all, Britain remains, in the words of one, “one of the most astonishing places in the world” and the sixth-largest economy, with the world’s best universities, generally safe streets and high levels of happiness. But such arguments are a “coping mechanism in the face of near total stagnation”. Across the board, Britain “does not work as it should” and our political class is “all too happy to give in and accept the status quo”. The tax burden is at a record high. Growth is stagnant. Unemployment is on the rise. Culture-war issues flare. “Zoom in” and the decline manifests in even the smallest of issues: we have a backlog…

● Aberdeen Equity Income is set to take over its stablemate Shires Income in the first investment-trust merger of 2026. While both trusts have recently been performing well and trade at close to NAV, the deal will increase scale, improve liquidity and lower costs, say the boards. Total assets post-merger are expected to be between £289m and £320m, depending on take-up of a cash-exit option of up to 25% for Shires’ investors. Aberdeen Equity Income’s investment policy will be updated to include Shires’ ability to hold investment-grade bonds, preference shares and international shares. ● Gresham House Energy Storage has signed deals for two new pipeline projects. The £448m battery-energy storage fund is to acquire the 240MW Cockenzie project in East Lothian and 57MW Monet’s Garden project in North Yorkshire, conditional…

Ladbrokes has refreshed its bets for the new year, with a large number of new markets now on offer. While some of these have to do with the US and other countries, most of them involve Britain. They range from bets on individuals, such as Boris Johnson, Jeremy Corbyn or Nigel Farage, through to punts on the leaders of the main parties and wagers on the next general election. All in all, I counted no less than 62 different UK markets, with many offering multiple outcomes. Of course, not all of these will be worth betting on. In many cases, the chances of the event happening don’t justify the odds being offered, such as in the 25/1 on Nigel Farage appearing on Strictly Come Dancing during the current parliament. In…

Lawyers are increasingly seeing couples fight over how assets obtained before their marriage should be split in a divorce, writes Sam Walker. The issue is known as “matrimonialisation” – the process by which non-marital assets become matrimonial assets as a result of married couples typically sharing finances. The issue is a legal grey area and disputes over whether pre-marital assets should be divided on divorce have more than tripled over the past two years, according to Nockolds, a law firm. It estimates that there were roughly 3,200 court claims in 2024-2025 related to matrimonialisation – up from 1,200 the previous year and just 800 in 2022-2023. The recent surge in court disputes over which assets are subject to division on divorce is partly down to more complex wealth structures, such…

• More than a quarter of savers making pension contributions at work via salary-sacrifice arrangements are planning to increase how much they save before changes announced in the Budget come into effect. In November, the chancellor said she would limit the tax break available on salary-sacrifice schemes to just £2,000 a year from April 2029. That appears to have galvanised savers to cash in on the schemes in the meantime, with 28% of existing users saying they planned to raise their contributions, according to research by Pensions UK. • Pensioners on low incomes are routinely failing to claim the council-tax discounts to which they’re entitled, pension experts warn. Just one in four pensioners eligible for help with their council tax – potentially worth more than £1,000 a year – actually…

Venezuela’s acting president, Delcy Rodríguez, returned to X this week, reversing her predecessor Nicolás Maduro’s decision to block the social-media platform, says Bloomberg. Her interior minister Diosdado Cabello, the regime’s ruthless enforcer, also returned to the channel. Both said they were back to “reconnect” with people and called for unity to stabilise the economy following the US toppling of Maduro. Rodríguez (pictured), “one of the iron fists in Venezuelan politics”, is well placed to do that, says Reuters. She is a “practitioner of economic orthodoxy who has strived to build relationships with the private sector”, and, having spent more than a decade in public life, has “amassed significant influence”. The 56-year-old, known as “the tsarina”, has a taste for luxury, but her revolutionary credentials are not in doubt. Her father…

The secondary market for luxury goods (see left) has “exploded” in the last decade, growing by at least 10% a year to outstrip the primary market, says Allison Schrager on Bloomberg. It is now worth around $200bn, spurred on by the internet, which has enabled greater transparency in pricing and easier authenticity verification. That has led to greater sales volumes and greater liquidity. Handbags are a case in point. Luxus, a US asset manager, has a hedge fund that buys Hermès Birkin and Kelly handbags on the secondary market and then “flips them”. It raised $1m in its first round, with which it bought 36 bags. It claims it made a 40.6% return and it plans to expand the trade this year. The return would, no doubt, have been greater…