Share to Twitter Share to Linkedin Sir John Templeton was a twentieth century American-born British investor, banker and fund manager. He entered the mutual fund market and created the Templeton Growth Fund, which averaged growth over 15% per year for 38 years. He once said, “To buy when others are despondently selling and to sell when others are avidly buying requires the greatest fortitude.” Warren Buffett also once said that it is wise for investors to be “fearful when others are greedy, and greedy when others are fearful.” Easier said than done, I hear you say. How do you keep your head around you when everyone is losing theirs? Thinking contrarian has always been a great strategy and one which I have employed extensively over the years. Naturally, to be honest. Thinking differently to the crowd requires patience, discipline, and very little emotion. These are traits that sometimes have to be wired (or indeed forced) into your brain. Especially when you … [Read more...] about Crashing Stock Markets Can Provide Opportunity For Longer Term Gains. But Do You Have The Stomach For It?
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- A + A DUBLIN/LONDON (June 29): A dirty little secret in a US$1.2 trillion world of credit is getting exposed as the Wall Street rout deepens: Private debt is now the cheaper financing option for big-ticket leveraged borrowers than the ailing public market — upending industry norms. As banks get pummelled by risk aversion and sinking asset values, direct lenders are lavishing risky companies and private-equity firms with capital at rates below what’s available in the volatility-lashed high yield and syndicated loan market. These asset managers are so desperate to unleash all the billions amassed in the low-yield era that they’re increasingly putting up with lower returns than their risk-averse peers in other parts of the credit world are willing to stomach. As traditional lenders beat a retreat, the bonanza is helping power leveraged buyouts with deals including The Access Group, Davies Group, Ivirma Group and Zendesk. “We have seen a few cases in which private … [Read more...] about Private lenders are offering cheaper debt than Wall Street banks
Share to Twitter Share to Linkedin For anyone who writes on the state of the world, the approach of Christmas brings with it the near obligation to sketch out the events and happenings of the year ahead. Last year, I took a traditional though cynical approach when I wrote Drinking with Dickens , the aim of which was to imagine what a vision of the year ahead would look like, whilst under the influence of some of Charles Dickens favourite drinks (i.e. ‘Smoking Bishop’). In the end, some of my comments (‘higher inflation’, ‘tension in Asia’ and ‘Boris resigns’) came close to the mark. The Folly of Forecasting This year, I have a less weary approach, partly because there are so many new, emerging trends, partly because the world is opening up travel wise and partly because there is so much at stake. The real world remains stranger than fiction, though to join the two I have added some book recommendations. JK Galbraith wrote that the only role of … [Read more...] about 2022 – What’s Next?
Share to Twitter Share to Linkedin Regular readers may be a little bored with me repeating my ‘Interregnum’ thesis every week, but as a framework it appears to work on a growing basis. The thesis is that in this post-globalization phase in world affairs, the boons of globalization are being quickly reversed – low inflation, low rates and geopolitical peace have given way to record high inflation, lightning rate increases and a brutal war in Europe. Another facet is the vandalisation of the pillars and sacred cows of the old globalized world order – from trade agreements to diplomatic ties and niceties. In the past week, another event has come along to confirm this framework – the attempt by Boris Johnson’s government to jettison the Northern Irish Protocol, an action that would effectively undercut the Good Friday Agreement. Many of you who do not live in or near Ireland will be forgiven for not understanding the complexity of Irish history, and the … [Read more...] about Boris Johnson Undermines Northern Ireland Peace Process
- A + A HONG KONG/LONDON/BENGALURU (June 29): The latest easing of coronavirus travel rules combined with other encouraging policy signals have began luring some foreign investors back to Chinese stocks, raising the chances that the market can sustain its bounce after months of heavy selling. As the S&P 500 is about to close its worst first half of any year since 1970 and bonds have taken a thrashing, China's beaten-down equity markets start looking like a shelter from a global storm of runaway inflation, interest rate hikes, and recession fears. China's blue-chip CSI300 index is up about 20% from April lows, as is the Shanghai Composite after losses of more than 10% in the first quarter. The gains, together with the relaxation of lockdowns and signals that Beijing could ease up both on virus policies and regulatory clampdowns, have tempted money managers, who were quitting China en-masse in March, to return. Those who were on the sidelines, "have shown some … [Read more...] about Easing Covid-19 rules, growth focus aid China bulls’ cautious return
Share to Twitter Share to Linkedin One of the striking images of recent current affairs is the leaders of France, Germany and Italy in a train compartment on their way to Kiev. Trains have played an important part in the history of European wars. For instance, armistices for the first and second world wars were signed in carriages and the professionalisation of the German army officer class in the lead up to the first world war was driven by the need to rationalise complicated train timetables (it’s a long story). Emmanuel Macron’s trip to Kiev offered him a much-needed chance to clarify his stance on the war, though his return to Paris was less happy as he subsequently lost his absolute majority in parliament. My sense is that the rise of the far left and right in France is less damaging in the near term for Macron – he will likely gain support from the right ‘Les Republicans’, to the long-term benefit of Edouard Philippe perhaps. What is more interesting in … [Read more...] about Do Ukraine And Roe V. Wade Mean The End Of Democracy?
- A + A NEW YORK (June 30): The S&P 500 ended a seesaw session slightly down on Wednesday as investors staggered toward the finish line of a downbeat month, a dismal quarter, and the worst first-half for Wall Street's benchmark index since President Richard Nixon's first term. The three major U.S. stock indexes spent much of the session wavering between red and green. The Nasdaq joined the S&P 500, closing nominally lower, while the blue-chip Dow posted a modest gain. "The market’s struggling to find direction," said Megan Horneman, chief investment officer at Verdence Capital Advisors in Hunt Valley, Maryland. "We had disappointing data, and the markets are waiting for earnings season, when we'll get more clarity" with respect to future earnings and an economic slowdown. Market leaders Apple, Microsoft and Amazon.com provided the upside muscle, while economically sensitive chips, small caps and transports were underperforming the broader market. With the … [Read more...] about S&P 500 limps to slightly lower close as quarter-end looms