All I know is that financial markets cannot stay disconnected from economic fundamentals forever so, ultimately, the Tony Dyes of the world will be proven right. Unless they lost their jobs beforehand, that is.
Articles written by: Niels Jensen
Looking For Bubbles
Recent weeks haven’t offered much fodder for the optimists of this world. Eurozone leaders continue to rely on their central bankers to do the dirty work and the dithering is beginning to have an effect on consumer and business confidence across the world.
DON’T FIGHT THE LAST WAR
In the science of economics there are no such constants, yet investors often behave as if they operate in a world of logic and certainty. Because such assumptions are made, history is littered with investors who have failed miserably.
YOU CAN’T HANDLE THE TRUTH
Remember the scene in A few Good Men where Colonel Jessup (Jack Nicholson) and Lieutenant Kaffee (Tom Cruise) trade insults? Following some pretty intense questioning, Kaffee yells at Jessup: “I want the truth”. With the deadly glare that only Jack Nicholson can muster, Jessop retorts: “You can’t handle the truth”.
THE PROTEIN BOMB
Question for you: Which distinctly British asset class has offered the most attractive returns over the past decade? Central London property? Not even close, even if it has done rather well. UK farmland is the answer, having more than tripled in value over a decade which will otherwise not be remembered for its outsized returns (see story here).
THE UNLIKELY BULL MARKET
Europe is going from crisis to crisis as the rest of the World is doing its best to muddle through. Meanwhile, global equity markets do not seem to care one jot. They only recognise one direction at present and that is higher. Many investors are perplexed. Fundamentals stink, or so most investors seem to think. Some commentators even talk of a pending equity meltdown of cataclysmic proportions. What on earth is going on?
THE FACTS THEY DON’T WANT YOU TO KNOW
What have Bill Gross, John Paulson, Anthony Bolton and Bill Miller all got in common? They are all ‘rock star’ fund managers who have fallen on hard times more recently. Life in the fund management industry is not what it used to be like. Life is tough even for the supremely skilled. Markets are changing, fund managers are struggling to adapt and clients are growing restless as a result.
IGNORE EGAN-JONES AT YOUR OWN PERIL
The ink on the Greek rescue agreement had barely dried before a triumphant, nappy-changing French President with an ego to match the heels of his shoes went on French television to portray himself as the saviour of Europe. “We find ourselves at the start of a new world”, he jubilantly proclaimed.
POINT OF MAXIMUM PESSIMISM?
I can’t remember having experienced this much pessimism before. 2008-09 was different. Back then it was fear more than pessimism, fostered by investors being hopelessly unprepared for what happened. The present crisis is well advertised, causing more pessimism than actual fear; however, whatever you call it, the current level of gloom and doom is quite simply overwhelming. Marc Faber must be having a field day!
IF CARLSBERG DID MORTGAGES
…they would probably be the best mortgages in the world. Denmark has produced many famous brands over the years, and many of them have become as popular abroad as they are back home; however, arguably the most successful Danish invention of all times has never gained much traction abroad, but that may be about to change. Please welcome the Danish mortgage finance model.
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