Markets have a habit of getting over-excited. They get FOMO and become over hasty. Although the outlook is improving, there is certainly little to justify some of the more speculative hype dominating market moves. Time a bit of rational thinking and common sense – consider Tesla as an example of misplaced hopes.
Around the globe everyone thinks inflation is beaten. It may well be, but the consequences will persist. Interest rates may not “pivot” the way market optimists hope, with profound implications for equities and bonds. We are into a new market cycle of normalised rates and corporate fundamentals. All-in-all, that’s a good thing for growth!
Halloween is a great time to be scared about markets. They are inconsistent, confused and uncertain, but the reality is even rising interest rates, inflation and trade wars sort themselves out - eventually. The real danger is how much worse bad politics and make a scary situation absolutely frightful.
Well, that was a fun week… but the UK’s travails are the tip of the iceberg of market pain facing the global economy. More political, geopolitical, liquidity and leverage driven crises are coming as markets reverse out the QE era. Don’t Panic!
Risk does not disappear. It hides in plain sight – as the investment industry will increasingly discover as crises mounts. Fortunately, there are SOB’s who have seen it before and are too aged to panic…
We’re officially in a bear market, but markets are still massively overvalued. The laws of Mean Reversion are immutable – some stocks are going lower. Inflation, Bond Markets and Confidence are all flashing danger signals.
The outlook for markets remains dire.. no worries! But what chance governments, central banks, the economy and growth enablers suddenly turn up the good news and put it all right again…? Are we over-estimating stagflation and recession?
Two simple questions for Central Banks; what was their plan, and what is it now? The consequences of 14 years of monetary experimentation are upon us. From Macro to Micro, Boeing is a sad illustration of the consequences of central bank policy.
Netflix just experienced its’ judder moment – and it is shaking markets. Overnight the streamer became a completely different investment proposition, even though we’ve been warning it was inevitable. There are lessons to be learnt across the equity market.
Yet another difficult week in prospect for markets as $130 oil threatens a global shock, geopolitics remains on the edge, and London tries to rid itself of an infestation of oligarchs without exposing the politicians who let them capture the state.
