Occasionally the Morning Porridge strikes a lucky insight on markets – this morning here are some thoughts on how 2022 markets and events may or may not develop. If they occur I shall hail myself an investment genius. If not, can we quietly forget them?
Lots of small signals, rising rates, a tech wobble, Covid vs freedom, China’s Covid crisis and the anniversary of the Capitol riot make for a rich stew of confusion in today’s markets!
Markets are welcoming victory versus COVID, but the next crisis is upon us: Energy instability. The consequences could be dramatic..
Climate Change and Energy Transition is one of the great challenges to capitalism and market economies – but there is no reason to fear it. Its complex, but infinitely solvable. The technologies exist to achieve carbon neutrality by 2050 at a cost far less than doomsters fear.
Lockdowns and travel restrictions highlight the economic damage Omicron has done to the whole European Economy. Corporate resilience will be severely tested – whatever governments decide. The likelihood of stagflation has risen, but markets are likely to benefit from buy-the-dip mentality as investors weigh-up renewed government support if/when it turns nasty!
Let me present a list of things to worry about next year. Inflation, US and China growth, Stagflation, Central Banks, Stocks, Climate and Equality, etc, etc.. But the big risks will be the consequences of US Politics and a Liquidity Meltdown in the Credit Markets.
Did you feel markets judder when Powell spoke? The mood has changed as markets wake up to the danger Central Banks might just start doing their jobs. As Winter begins, Europe faces a bleak energy crisis of its own making. My solution? Buy a generator!
Fraxious markets as stocks wobble, fears rise, energy prices spike; what’s to worry about? Preparing for inflation would be one thing – but being ready for opportunity is another!
October is the cruellest month for markets. What to fear most? Markets? Energy? China? or America? Or will it be a “no-see-um” that sinks us?
Porridge Extra – 30th September 2021: The Looming Energy Crisis: People Are Going To Die This Winter For many months…