This bear can be a real bull….

Tuesday 7th February 2017

This bear can be a real bull….

Markets bucked expectation when Donald Trump was elected president….

They were expected to respond negatively to the uncertainty he personifies….

In the event, markets took Trump’s campaign promises for deeds and rose to new heights….

If that represented euphoria, there were signs last week that the market is regaining its senses….

In his 4th-quarter letter to investors in Elliott Management, the hedge fund he runs, Paul Singer said this:

‘There is a deep underlying complacency which we think permeates global financial markets. The basically-low volatility of the last eight years has led to a widespread assumption that financial market volatility has been bottled and will remain controlled.’

The implication is that volatility is not under control. That, like the tiger you mistakenly believe you’ve tamed, it retains teeth, claws and the ability to savage you….

Ray Dalio at Bridgewater Associates also issued words of caution:

‘Nationalism, protectionism and militarism increase global tensions and the risks of conflict. For these reasons, while we remain open-minded, we are increasingly concerned about the emerging policies of the Trump administration….’

It is dawning on investors that Trump’s ‘America first’ policies could stymie the very growth they are intended to generate….… Click here to read more

When forecasts go wappy….

Tuesday 31st January 2017

In this issue of Money Truths….

  • Nobody knows. Not really….
  • When forecasts go wappy….
  • We can get it wrong as well as the next man….
  • Events – often diametrically opposed to expectation….
  • The consensus view – a fine contrarian indicator….

Nobody knows. Not really….

Nobody knows anything. Not really. Nobody knows what will turn out good, bad or ugly….

Nobody knows for sure which market, stock, commodity, bond or currency will rise or fall. By how much, at what rate or when….

Nobody can predict tomorrow’s financial climate – let alone the climate 3-months, 12-months or 5-years hence….

Of course, there’s a multi-billion-dollar financial services industry – populated with all manner of expert – which is dependent on convincing you otherwise….

Economists, bankers, analysts, money-managers, traders, financial advisors, politicians, press pundits and talking heads all make a living peddling the same deceit – that they know what’s going on and what will happen.

But they don’t know. They have mere beliefs and opinions. They make speculative forecasts.

But the thing with a forecast is that it represents an estimation or prediction made in the absence of any certain knowledge….

It amounts to guesswork. Some guesswork will be better-informed than other examples.… Click here to read more

Trump – the perfect patsy for upcoming market crash….

Tuesday 24th January 2017

In this issue of Money Truths….

  • Powerful enemies are bent on revenge….
  • Wrong time & wrong place, Mr. President….
  • The life support system will be switched off….
  • Trump’s comeuppance….

Powerful enemies are bent on revenge….

What happened in America with Donald Trump and the presidency is like going to bed in Britain one night and waking the next morning to find foul-mouthed chef Gordon Ramsey calling the shots in 10 Downing Street.

Trump and Ramsey are both successful businessmen. Both have used reality TV to carve out a constituency. Both have personas deeply rooted in unadulterated and unmitigated boorishness. Neither man lacks for self-confidence. Neither takes prisoners nor spares feelings.

Life under either man would be nothing if not interesting. You don’t know where the journey with either man would take you, but you know there’s going to be plenty of effing and blinding along the way….

Trump is an establishment outsider with no experience of politics or high-office. That’s precisely what the American electorate liked about him.

He’s not soiled by the mucky Washington ‘swamp’ of insiders, power-brokers and vested interests. He casts himself as a man of the people – reclaiming America for the ordinary man-on-the-street American.… Click here to read more