2020 Investment Strategy. Generally Cautious.
Tuesday, 14 January 2020 | 7:41 am
Reduce equity exposure. Equity markets have outpaced fundamentals recently. In any reversion to mean, equities will perform in line with fundamentals which suggests a much more moderate performance in 2020. On that basis alone, investors should reduce equity exposure. By how much? In a balanced portfolio with 35% in equities and 65% in fixed income,
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Gold. Political Risk Hedge. The Schadenfreude Trade.
Friday, 10 January 2020 | 7:42 am
The case for gold has never been stronger with the rise in geopolitical risk since 2016. Since 2000, the price of gold has risen sharply, at an annualized rate of nearly 14%, only to peak in 2012 before losing 40% in 3 years for an annualized rate of -7.4%. Since then it has risen erratically
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10 Seconds Into 2020. Geopolitics and US Elections.
Wednesday, 08 January 2020 | 10:35 am
Welcome to a long rambling piece about the economic and market outlook. There is a lot to think about but in the end, if all you are interested in is the direction of the financial markets, go to the end of the article on US Elections and Trump. Geopolitics. A key driver of economics and
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Information, Efficiency and Scale
Monday, 30 December 2019 | 6:35 pm
Central planning is superior to free markets if the central planner has perfect information, and acts in good faith. Free markets are better when information is imperfect. When information is localized by a factor or location, decentralized groups can process information more effectively. These groups, can be regarded as centrally planned cells within a neighborhood
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China and the US. Is the Belt and Road Initiative China’s Marshall Plan?
Monday, 23 December 2019 | 3:00 pm
What does China want? What did Germany want in the 1930s? A little respect, a little less bullying, and a bit more space. Germans felt aggrieved at the terms of Versailles, that reparations had gone too far and that they had been unfairly treated. What did Russia want in the 1950s? Security. Russia was driven
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