We’ve got a packed edition of the magazine this week – we look at robot cars, the case for and against the EU, and what ‘peak connecting’ is and why it spells trouble for tech.
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How you can help save capitalism from itself
Merryn kicks off the issue with a plea for MoneyWeek readers to help rescue capitalism. There’s a heated debate raging all over the papers, TV and radio – and in the cinema, with the release of the film The Big Short (which Matthew Partridge calls “one financial film you should definitely watch” in his review).
Capitalism is the best system we’ve found yet. But it’s being undermined by corporations getting away with murder, says Merryn. Or at least, getting away with not paying their taxes. At the same time, they’re paying workers low wages, and handing over millions of pounds to top executives.
What capitalism needs is good, responsible shareholders, says Merryn. And that means asking your fund manager – or whoever’s looking after your money – to step up and start demanding that the companies they invest in behave.
Merryn’s not alone in her desire, it seems. James Anderson of the Scottish Mortgage Investment Trust (one of the trusts in our investment trust portfolio) gets it. Just this week he’s come out and demanded that Google owner Alphabet (his trust owns a £120m chunk) start paying its taxes properly or face a huge public backlash.
Why we should stay in the EU…
We’re for Brexit here at MoneyWeek. But that doesn’t mean we won’t give you both sides of the story. This week, Merryn interviews journalist, author and founder of the Breaking Views website, Hugo Dixon.
He’s a committed Europhile, and while he recognises its flaws, he believes that Britain must stay in the EU if we are to have any influence at all on shaping the rules that we will almost certainly have to follow anyway if we want to trade with Europe – even if we vote to leave. Giving up a certain amount of sovereignty is inevitable, but it’s a price worth paying, says Hugo, such are the rewards of staying in.
..and why we must leave
Charlie Morris, on the other hand, is a committed eurosceptic. The investment editor of the Fleet Street Letter says the EU is “the Vatican of our time” and a modern-day Reformation is needed to free us from the shackles of centralism.
The EU is a huge drain on Britain’s economy. While Britain is creating jobs, Europe is destroying them. Britain’s exports to the world outside the EU are growing twice as fast as our exports to the EU, as the eurozone economy is too weak to provide the demand for our goods.
The EU is “dominated by France and Germany”, says Charlie. And, far from having a say at the table, Britain is “frustrated” by its “lack of influence” over decision making.
“Spread the word”, says Charlie. “Vote leave.”
The future of motoring is electric – and driverless
Petrolheads beware. Driverless cars are coming, says Matthew Partridge. They’re not here yet – the closest you can get at the moment is a Tesla Model S – but it won’t be long. Many of the big carmakers are spending huge sums on self-driving technology. Right now, you can get a modest family car that can park itself and brake automatically to avoid a collision.
Along with the family runabout, public transport and road haulage could be transformed by the new technology, says Matthew. The best way to play it isn’t necessarily to buy carmakers, though. Matthew looks at the companies that are behind some of the high technology needed to make robo-cars a reality, and pics seven of the best stocks to buy now.
But in other areas, tech stocks could soon be in trouble
Forget peak oil, peak gold or even “peak stuff”. It looks like we’ve hit “peak connecting” says Matthew Lynn, as people reach a physical limit on the amount of posts they can make on social media, or messages they can send to friends.
This could make a huge dent in the stockmarket, as the share price of companies such as Twitter crater. It’s not just the headline names, says Matthew, there are “the companies that mine them for data, run games on them or use them to reach customers” that could get caught up in the next tech bubble and bust.
If you want to avoid getting caught out yourself, now’s the time to act.
Elsewhere in the magazine, Alex Williams looks at how to bet on a bear market; Sarah Moore examines the performance of active funds – and names the worst ones; and Natalie Stanton reports on yet more changes to the pension rules, and how they could affect you.
Plus, there’s Chris Carter on cheap rooms at top destinations, a round-up of properties to buy for £1m, and the key to buying classic cars, if you’re not quite yet ready to cede the road to robo-cars.