Hi Reader, here's what you need to know for August 6th in 3:00 minutes.

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Today's big stories

The US president announced plans for half of all vehicles sold in the US to be electric by 2030
The next taper tantrum is imminent, so you'll want to make sure you're holding the right stocks – Read Now
The Bank of England made gestures toward a return to more normal interest rates as the UK economy recovers

Virtue Signaling

What’s Going On Here?

Not to harp on about it or anything, but the US president called on Thursday for half of all vehicles sold in the US to be electric or plug-in hybrid by 2030 (tweet this).

What Does This Mean?

Electric vehicles (EVs) only accounted for 2% of US passenger car sales in 2020, according to Bloomberg, so this target isn’t exactly an easy one to meet. Fortunately, it’s more symbolic than legally binding, and motivated by a couple of factors: climate concerns, of course, but also the worry that the US will fall behind Europe and China in developing its EV industry – essential to any ahead-of-the-curve economy. As for the country’s carmakers, they’re happy to help, but they did point out that this ambitious target would only be achievable if the government laced their palms with silver…

Why Should I Care?

The bigger picture: Keep up or drop out.
The announcement hasn’t fundamentally changed anything for US carmakers, many of which have long since announced plans to shift focus to EVs. General Motors, for example, is planning to only sell zero-emission models by 2035, while Ford and Chrysler-parent Stellantis are expecting EVs to represent 40% of global and US sales respectively by 2030. Still, given the huge investment required and the intensifying competition from EV newcomers, only time will tell if the traditional players can actually make a decent return on their investment.

For you personally: Think laterally.
There are ways other than carmakers to invest in EVs – like, say, the companies that are building and operating charging stations. They’ve already installed more than 100,000 in the US, and, according to the Zero Emission Transportation Association, 4.4 million more will be needed if the US is going to transition to all-electric vehicle sales.

You might also like: How to invest in the EV supply chain.

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2. Analyst Take

Which Stocks Will Be Caught In The Next “Taper Tantrum”?

What’s Going On Here?

You might remember the last “taper tantrum” back in 2013, when the Federal Reserve (the Fed) simply hinted at slowing down its bond-buying.

Well, odds are there’s one on the horizon in the next couple of months.

Economists, after all, are expecting the Fed to drop a similar hint next month, and – even though nothing will actually change until next year – markets will react immediately.

Here’s the good news: history can tell us which industries and companies are likely to be hit hardest, and which tend to come away unscathed.

So that’s today’s Insight: how to adjust your portfolio so you’re primed and ready for the Fed’s next update.

Read or listen to the Insight here

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