{"id":20743,"date":"2023-06-10T00:18:05","date_gmt":"2023-06-10T04:18:05","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/possible-threats-and-hidden-risks\/"},"modified":"2023-06-10T00:18:06","modified_gmt":"2023-06-10T04:18:06","slug":"possible-threats-and-hidden-risks","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=20743","title":{"rendered":"Possible Threats and Hidden Risks"},"content":{"rendered":"<div id=\"js-article__body\" itemprop=\"articleBody\" data-sbid=\"SB50265545311184204908504590013472310283234\">\n<p><strong>To the Editor:<\/strong><br \/>I have no objection to some level of bank regulation and oversight, but there has been a lot of noise on this topic that seems to be by regulators seeking to impose controls and inefficiencies as widely as they can (\u201cThe Perils of \u2018Shadow Banks\u2019, \u201d Cover Story, June 2). <\/p>\n<p>It\u2019s the collapse of highly leveraged debt structures that could be a real threat to economic stability. But this article isn\u2019t finding any, especially in comparison to the enormous leverage carried by banks. <\/p>\n<div class=\"paywall\">\n<p>Such threats may perhaps exist; the risks hidden in leveraged derivatives was missed by most before 2008. <\/p>\n<p><strong>R. Paul Drake<\/strong><br \/><strong>On Barrons.com<\/strong><\/p>\n<h2>Beware of AI Investing<\/h2>\n<p><strong>To the Editor:<\/strong><br \/>Under the hood of artificial intelligence, market manipulations like pump-and-dump schemes would become prevalent as well as more complex and harder to detect (\u201cAI Is Going to Change Investing. Here\u2019s How It Could Play Out,\u201d Up &amp; Down Wall Street, June 2). Beware of AI in investing, since AI bots will be reasoning and deciding based on data they are fed. Data can always be manipulated or engineered. Human innate feelings based reasoning are still far from being cloned in AI bots. <\/p>\n<p><strong>Milind Bhagavat<\/strong><br \/><strong>On Barrons.com<\/strong><\/p>\n<h2>3 Dividend Kings<\/h2>\n<p><strong>To the Editor:<\/strong><br \/>With interest rates on savings accounts and money markets above 4%, Carleton English states that high-quality stocks like PepsiCo, Coca-Cola, and Colgate-Palmolive, with current dividends of 2% to 3%, lose their attraction (\u201cDon\u2019t Look Now, but Tech Stocks Are the New Defensive Play,\u201d The Trader, June 2). <\/p>\n<p>What needs to be considered is the fact that each of the named businesses is a \u201cdividend king,\u201d having raised dividends for at least 50 years\u2014PepsiCo for 50 years, Coca-Cola for 61 years, and Colgate-Palmolive, also for 61 years. Over the past decade, PepsiCo has increased its payout 7.8% per year, Coke by 5.6%, and Colgate-Palmolive by 4.3%. With a record like that, our family office prefers the equities.<\/p>\n<p><strong>Patrick J. Keogh<\/strong><br \/><strong>Llano, Texas<\/strong><\/p>\n<h2>Hyping India\u2019s Rise?<\/h2>\n<p><strong>To the Editor:<\/strong><br \/>While I found the article \u201cIt\u2019s Not Just AI. 5 Trends That Will Change How You Invest\u201d (Guide to Wealth, June 2) fairly timely and predictable, India\u2019s rise seems hyped. While India has seen infrastructure improvements and structural reforms over the past decade, the stability of those reforms has yet to be tested by the country\u2019s many underlying issues. <\/p>\n<p>Beneath the surface, the infrastructure improvements are overshadowed by gross incompetencies in implementation, as evidenced by the horrible train accident last week. India wants to be where China was 20 years ago\u2014enjoying an inflow of unabated foreign capital investment and creating a broad manufacturing base for its vast, unemployed younger population. <\/p>\n<p>How good is a vast young population if a majority lack proper education? It is no secret that India\u2019s best and brightest leave in droves to find better education and employment in other countries. Those left behind find themselves in difficult economic circumstances. Multinational companies have identified this trend and exploited it. <\/p>\n<p>For instance, Apple\u2019s interest in shifting production to India is driven by a desire to increase its market share with the world\u2019s largest population. Investor confidence has been boosted by the possibility of great Indian stories yet to surface, but I would be cautious at best.<\/p>\n<p><strong>Dinesh Rastogi<\/strong><br \/><strong>Canonsburg, Pa.<\/strong><\/p>\n<h2>Eaton and NVent<\/h2>\n<p><strong>To the Editor:<\/strong><br \/>Al Root\u2019s bullish analysis of Eaton (\u201cEaton Stock Has Seen a Lot of Growth. Why the Ride Is Not Over,\u201d Follow-Up, June 2) has considerable merit, the essence being the company\u2019s status as the \u201cposter child for electrification.\u201d <\/p>\n<p>This theme reminded me of Root\u2019s insightful and prescient column on nVent Electric (\u201cThis Small-Cap Stock Is Cheap and Growing Fast. It\u2019s Time to Buy\u201d (Sizing Up Small-Caps, March 25, 2022). NVent is a picks-and-shovels play on the electrification trend, with its electrical connection and protection products being an essential component of its customers\u2019 installations. Since publication of that article, nVent has sported an upside gain of 35%. Its market cap is now $7.6 billion. The forward price\/earnings ratio is 15.5. Eaton\u2019s gain over this same period is 28%. Its market cap of $74.3 billion is nearly 10 times that of nVent, and its forward P\/E of 21.9 reflects a less-attractive valuation. <\/p>\n<p>Against the backdrop of these metrics, what resonates most loudly is Root\u2019s statement that \u201cnVent also has a wild card\u2014the possibility that it will be taken over.\u201d And, to come full circle, which company does Root highlight first as a potential suitor? That\u2019s right\u2014Eaton. My own analysis strongly suggests that such a marriage would be highly complementary to Eaton. <\/p>\n<p><strong>Rob Suthe<\/strong><br \/><strong>Bethesda, Md.<\/strong><\/p>\n<h2>Too Slow, Too Fast<\/h2>\n<p><strong>To the Editor:<\/strong><br \/>Regarding \u201cThe Drivers of Inflation Are Reversing. The Case for Fed Cuts\u201d (Other Voices, June 2), Ian Shepherdson does a masterful job of combining micro- and macroeconomics while reminding us of Rudiger Dornbusch\u2019s timeless quote, \u201cIn economics, things take longer to happen than you think they will, and then they happen faster than you thought they could.\u201d<\/p>\n<p><strong>David Johnson<\/strong><br \/><strong>Brooklyn, N.Y.<\/strong><\/p>\n<p><strong>Send letters to: <\/strong>mail@barrons.com. To be considered for publication, correspondence must bear the writer\u2019s name, address, and phone number. Letters are subject to editing.<\/p>\n<\/p><\/div>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.marketwatch.com\/articles\/possible-threats-and-hidden-risks-dcd38346?mod=markets\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>To the Editor:I have no objection to some level of bank regulation and oversight, but there has been a lot of noise on this topic that seems to be by regulators seeking to impose controls and inefficiencies as widely as they can (\u201cThe Perils of \u2018Shadow Banks\u2019, \u201d Cover Story, June 2). It\u2019s the collapse [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":17552,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-20743","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Possible Threats and Hidden Risks | iFintechWorld<\/title>\n<meta name=\"description\" content=\"To the Editor:I have no objection to some level of bank regulation and oversight, but there has been a lot of noise on this topic that seems to be by\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/ifintechworld.com\/?p=20743\" 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