Big Pharma: Investment Bedrock | Barron’s
These companies are largely responsible for both extending life and quality of life, and are then demeaned by the political demagogues as the new robber barons. These companies are among the best and most productive in the world and bedrocks of the investment landscape. The volatility now embedded within will resonate deeply. Price controls never work out in the long run.
Dr. Michael Mikita
On Barrons.com
To the Editor:
I invested in Pfizer because of its great scientists and what I see as the team’s ability to keep generating a future pipeline of new discoveries that will enhance our lives and grow the Pfizer business. The dividend is handy also.
The pharmaceuticals business is a bit like mining. You can mine, but the deposit gets depleted over time, so you have to keep making discoveries. The baseline should not be the S&P 500 index but the S&P 500 minus the Magnificent Seven.
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John Barry
On Barrons.com
Golden Math
To the Editor:
When real interest rates were negative, gold bugs trumpeted that as a reason to buy gold, and yet the price languished (“Gold and Energy Rallies Are Sending a Message. It’s Not a Good One for Stocks,” Up & Down Wall Street, April 5). Real interest rates are positive now, and gold is soaring. I agree with some of the reasons put forth in the article, but I’ll posit another: math. It’s apparent that at some point the cost of servicing Western government debts will become prohibitive. Money will be printed. The amount of gold in the world will stay relatively constant.
Gene Sweet
Chicago
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Demographic Challenges
To the Editor:
It’s important to note that the techno-industrial megatrend has begun putting U.S. productivity improvement on steroids (“Falling Birthrates Threaten Economic Growth. This Economist Sees Some Remedies,” Q&A, April 4). Artificial intelligence is a moderate substory of this productivity trend. The U.S. throughout its history has employed technologies to adapt to demographic challenges, and it will continue to do so.
An example is the fast-food sector, where the lack of younger workers, as well as higher minimum wages, are rapidly driving owners to automate many of their processes, significantly increasing productivity. Many machine providers are supplying robots as a service, where clients are paying rental rates per transaction that are materially lower than that of manual help. I stay highly optimistic about the U.S. effectively dealing with its demographic challenges.
Roland Giuntini
On Barrons.com
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