This chin is going to be tested….

Tuesday, 28th November 2017

This chin is going to be tested….

The stock market appears to have an iron chin….

Over the last decade the FTSE has done nothing but rise….

No blow has been sufficiently hefty to wobble it, wind it or retard its progress – let alone threaten to take its legs and put it on the canvas….

Yes, we’ve seen the usual short-term fluctuations in overall values….

But the general direction of travel has been up – relentless rising values with multiple new record highs set along the way….

  • No ordinary environment….

In an ordinary environment, you’d expect this kind of rising market to reflect a golden period of corporate success – a boom time for business across the board….

But the environment surrounding this rising market has been anything but ordinary….

A decade of unprecedented loose monetary policy – in the form of record-low interest rates and quantitative easing (money printing) – has flooded the markets with a tidal wave of new cash seeking out returns….

It is this deluge of capital – rather than any bottom-line corporate performance – that has fueled and driven the relentless upward trajectory of the market….

  • The Goliath of bull markets….
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The observer’s guide to bubbles….

Tuesday 21st November 2017

The observer’s guide to bubbles….

The panic is over for bitcoin holders – for now at least….

Last week’s plummet in price proved to be a temporary aberration – as we suspected….

Last week I highlighted a few features and factors that will serve to fuel continued momentum in the market….

Over the last week, bitcoin has not only recovered the lost ground but has kicked-on again – blasting through the $8000 ceiling and reaching new high points….

We figure this will be the scenario for some time to come – occasional corrections but a generally upward direction of travel….

The big question is this: is bitcoin in a bubble?

  • A four-point sociological checklist….

One interesting feature about bubbles is that they are frequently only recognized in hindsight – particularly by investors who get caught up in them….

The promise of ‘guaranteed’ big profits on a continued basis can blind a man to underlying realities….

To the point where he swiftly becomes fixated on ‘getting involved’ and ‘not missing out’ rather than trying to figure out whether he should be doing so….

Such investors might do well to heed William J Bernstein, the American financial theorist.… Click here to read more

The party might not have started yet….

Tuesday, 14th November 2017

The party might not have started yet….

Over the weekend gravity confirmed it still exists….

Bitcoin had a rough time – plunging 30% just days after hitting a record-high of $7495….

If bitcoin were a stock, trading would have been halted on Sunday….

Maybe the decision of key market players last week to suspend a planned ‘hard fork’ (that would have increased transaction speeds) created a case of the jitters and a sell off….

Maybe it was news that US Treasury secretary Steve Mnuchin is in discussions with foreign counterparts about bitcoin being used to facilitate transfer of criminal proceeds….

Whatever, the weekend was a reminder that bitcoin is volatile. The crypto has enjoyed unprecedented lift this year – but it can go the other way too….

  • Hold your nerve….

This wasn’t the first-time bitcoin has suffered a brutal correction. Nor, I suspect, will it be the last….

But the cryptocurrency is already recovering. On Monday it rallied 11% in 12 hours – regaining $10 billion of value….

Nobody ever said you wouldn’t require nerves of steel for this ride….

And, if your nerves are jangling, remember who stands beside you in the trenches – bayonets fixed and ready to confront any challenge the cryptocurrency market issues….… Click here to read more