Blain’s Morning Porridge 29^th July 2025: The need to laugh at the nonsense of it all

 “These are the only ones the news has come to Harvard. There may be many more, but they haven’t been discovered.”

There are times when you have to laugh at the nonsense of it all. From a delusional, fantastical market to a blithering, blathering President, what’s not to like about these summer markets…? Er, how about how some great look back earnings hide the coming reality?

Y’day one of my stock picking chums told me to load up on US stocks. 80% of US firms have so far posted earnings beats! Time to buy, he said. I am calling my broker to scream sell at him as loudly as I can. Earnings are a look back. I perceive storms ahead.

At times like this, we need to smile. Let us therefore begin today’s lecture with a short distraction…

Bad news from the US yesterday, the death of Tom Lehrer, math(s) genius and brilliant writer of comic songs, at the age of 97. Sad, but he made everyone smile, and laughs are in short supply these days. In the 1960s Lehrer got bored of performing the same songs every night, so he went back to teaching math(s)! He gave away all the copyright on his whole body of work so anyone could sing them!

UK songster Richard Stilgoe provided a fitting ditty on the BBC’s Front Row radio show last night:

So, farewell to Tom Lehrer

Fearless, peerless pigeon scarer

Who sang with ne’r a care about the listeners’ distress

His skill with rhyme and language showed in every song he sang

Which makes it stranger that he thought that Math was spelt without an S.

I’ve spent a lifetime wondering where Americans might have mislaid the S on Maths.

If you don’t know the work of the magnificent Tom Lehrer I suggest you start with The Elements, progress to So Long Mum (a song he wrote about World War 3, figuring it was a good idea to sing it before the war as there would be no one left to hear it after!) and then the simply divine Poisoning Pigeons in the Park. Sounds awful, but you will smile all day long…

And smiling might not be on the agenda as we look at the markets this morning… Summer is oft a time of careless complacency… kinda feels that way.

Some of my market chums are telling me the indications for markets are excellent – they see rate cuts coming, money flowing into stocks and bitcoin confirming the underlying strength of the market, new highlights for AI in the works, growing institutional confidence in the economy, and rising acceptance in the credibility of crypto. And why not.. six implausible things before breakfast.

I look. I see. I walk away.

I see a stock market that is due a spanking. I see a bubble in AI. I see a bond market with its eyes wide shut. I see a cynical institutional BitCon buy-in on the back of the Crypto bills passed two weeks ago – the effective institutionalisation of Crypto was just what the big investment management firms wanted to expand and farm yet more retail crypto investors for fees while they take little of the risk.

Meanwhile, let us not dwell on US President Trump lording it up in my homeland of Scotland. I giggled as I watched the news, and thought about my mum – she would have been “affronted”, and told us just how much. Prime Minister Sir Kier Starmer must have been delighted to receive his good advice on so many subjects – and had the good sense to remain a gracious guest in his own country. (We know exactly what Starmer was really thinking – you could see it reflected in his wife’s eyes.)

Yesterday’s US/Euro trade deal elicited an enormous gallic-shrug from across Europe yesterday as any party in opposition accused politicians who accepted the one-sided deal of a “sell-out”. Yep, easy to be critical when the choice is trade Wah, Wah or Jaw, Jaw. (Try saying it in a Churchillian accent.) The Americans love it.. Well of course they do.. Tariffs on European goods could contribute some $210 bln per annum towards funding the US deficit..

Except, of course, the question is who ultimately pays? That money comes from somewhere. Will it be from European corporates, seeing their profitability battered, forced to make savings and cut costs to meet the 15% tax? Or will it be US resellers and importers who take the hit and reduce their profit margins to ease the pain on consumers? Or will consumers simply end up paying 15% more for a decent European car or pay less to buy something patriotically meh made in the USA (which will be 30% more expensive because all the parts are shipped in from Canada and Mexico..)

I predicted the markets would love the trade deal…. but curiously they appeared less than enthused. Maybe its because its notionally summer (you can tell as its raining here in Blighty), or may be its waking up to the reality that tariffs are a tax hike someone is going to pay, and higher taxes are traditionally not a route to global health, wealth and happiness.

Or maybe, just maybe, the markets are waking up to the mess after the party. That valuations in stocks and high-yield bonds look unjustifiable. And the pain from all these tariffs is still to come. They will be looking to see exactly what Microsoft and Meta spending all that money on Nvidia Chips and building AI infrastructure actually got them. Hangover time approaches, and someone just noticed someone painted a moustache on the painting of great aunt Harriet.

For all these reasons and more I am going to go sailing for August. From next week the Porridge will be intermittent. The boat is now fully up to speed and its’ wobbly keel fixed. We’re installing the latest in coms courtesy of my least favourite Techtrepreneur who has filled the night sky with small satellites. If it works expect Porridge Missives from where ever we end up from next week.

What else is on the agenda today? Let’s wait and see…

Out of time, back to the day job.. and looking fwd to a proper lunch…

Bill Blain

Author, The Morning Porridge

CEO Windshift Capital

Partner Shard Capital