Valuations in the USA look insane. Surely stock prices must be a bubble? Maybe. Maybe not – the USA has created a self-driving technology machine, a conveyor belt of tech innovation that’s set to continue delivering value and corporate profits. To understand it – ditch traditional thinking about economies.
The weekend’s events in Syria highlight dramatic and swift change at the core of the geopolitical instability that’s defined the last few years. The cost in blood from conflict has been horrendous, but from a market and stability perspective there is now more to be positive about. Russia and Iran’s defeat in Syria could even trigger global recovery!
I feel sorry for Sir Keir Starmer. He’s become the UK’s most hated politician in a remarkably short period of time. It’s apparently all his fault. Labour’s dither illustrates the real crisis at the heart of broken Britain: long-term fixes for incoherent privately-owned infrastructure when politics focuses on the immediate here and now.
Bitcoin breaking $100k was a judder moment in a market already awash with signs and portents suggesting irrational exuberance has gone too far, and a correction is coming. Meanwhile… the UK govt declares war on Porridge.
Europe is getting “interesting” in the Chinese sense of the word. The market to watch will be European Bonds – French OATs may just be the first to wobble. As the crisis unfolds (and it will) there may be opportunities to arbitrage the actions of the ECB to stem any crisis – watch this space.
Sequels oft disappoint. Just how will the world change after Jan 20th 2025? Maybe not the way we expect. Meanwhile, the global Alternatives markets are becoming increasingly frothy as the big firms bid up for market expertise and scale. Does that suggest they might be missing something?
Bitcoin is either the greatest thing ever, or a complete Ponzi. Take your pick. The Shills cite multiple reasons its going ever higher. It looks to be in the speculative mania phase - joining a long and distinguished list of scams that sought to draw in the greater fools. While some target $750k, the price history may suggests $25,000 as a more realistic entry, and even that could be unsustainable if the euphoric bubble finally pops.
Barclays has been fined £40mm for being “Reckless” in its dodgy 2008 capital funding programme. The judgement hides a multitude of sins and failures, especially in terms of probity and governance. It’s another chapter and illustration of how greed and avarice sank the once world-class UK financial industry over the last 40 years.
Scott Bessent’s nomination as US Treasury Secretary has been welcomed by markets. The expectation is he will use Trump’s rhetoric to negotiate more optimal outcomes. However, the World is changing – not just in terms of China and other nations emerging as challengers in a new global economy, but also in terms of how Trump could reset America domestically.
China issued $2bln of Bonds via Saudi Arabia last week. Some think it’s part of a malign plan for China to disrupt the global dollar bond markets. It may be the trigger for a dramatic rethink and recalibration of how global markets finance future credit. As geopolitical flux deepens, how might a new bond markets evolve?
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The Morning Porridge is not investment advice. It is market commentary based on discussions and information gathered from multiple sources believed to be reliable. No guarantee is given for its accuracy or completeness. It is not an offer to buy, sell or solicit investments or securities. The author may have a position in companies or institutions discussed in this commentary.
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