Markets are made of people. As a result, movement of market prices ultimately reflects collective human behaviour, greed and fear, endeavour and ambition. Global stock prices continue to rise, and many are now at historic highs. This asset price inflation has attracted many speculators who see an opportunity to make money quickly, but for a […]
“If you don’t know who you are, the stock market is an expensive place to find out.” These words, spoken in 1723 by Adam Smith, philosopher and economist, are a timely reminder that asset prices can fall much faster than they can rise. Apart from March 2020, many investment advisors have not experienced a severe […]
As I write, greed and euphoria have finally developed into the gambling mentality now permeating the stock markets in the US. History shows us that this will end in tears. The secret of success in long-term investing, as distinct from making speculative short-term bets, is avoiding serious permanent loss. The saddest chapters in the long […]
A battle of ideas is raging amongst investors and speculators, fought with equal conviction about the merits and defects of Bitcoin and cryptocurrencies. According to the founder of the Celsius Network, ‘people giving venture capital to crypto believe it will save humanity from itself’. It is easy to confuse cryptocurrency with a state-owned digital currency. […]
Successful investing is not a study of certainty, but a value judgement based on probable outcomes. The US electorate has voted and the result is contested, but what this means for the US and global economy is still uncertain. A US election is important because the US accounts for 25% of global gross domestic product […]
The inconvenient truth confronting investors is that economic outcomes over the short term are extremely difficult to evaluate with any certainty
Markets are a reflection of human behaviour and endeavour. In financial markets and in an economy, nothing happens in a vacuum. Eleven years of central banks’ money expansion while maintaining artificially low interest rates has pushed up asset prices, creating asset price inflation and moral hazard. Public and corporate debtors are taking on more debt, […]
The term “safe haven” has always been part of the investor’s vocabulary, taking on special significance in times of increased uncertainty. The attributes of a safe haven asset lie more with the investor than with any opportunity in the market. It has everything to do with who you are. How well do you know yourself? […]
Hailed by Barrons as the dean of global investing and one of the most successful investors in history, the late Sir John Templeton stated that ‘This time is different’ are ‘among the four most costly words in the annals of investing’. Before emerging markets became mainstream, Templeton was investing in emerging growth companies for parents […]
A ‘soft touch’ conjures up thoughts of someone who is easy prey, gullible and vulnerable to theft. In the context of financial services, a light touch regulation speaks of a more flexible and relaxed approach to regulatory oversight. For many years in the US and Europe, the world’s largest trading bloc, the rule of law […]
