Its Not Harry

Comment and opinion for retail investors in the UK

Mark Potter

Midweek Musings – late for a reason

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Readers who pay frequent attention to their portfolios and the general level of stock markets will have noted , perhaps with some concern, the sharpest sell off in equities for quite a while at the start of the week. Bond yields fell (making bonds worth more), which seems odd given that nearly everyone invited to comment seems to accept that we in for some serious inflation.

The mainstream media put the equity sell off down to concerm about the Delta version of the Covid-19 virus. That was obviously spurious given that the sell off was global and dramatic without there being any really new news on that subject. So there must have been another reason. I decided to wait and see what happened next, having a fairly good idea of what was really going on. That is why this post is a little late.

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Midweek Musings – little trouble in big China?

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Warning shot?

Or to be more precise – diddy (DiDi) trouble.

If you have not read about the Chinese ride sharing conpany DiDi (like Uber), you may not know that its IPO on the US stock market raised over 4 billion US dollars, but the share price did not fly away from launch. In fact the opposite happened.

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Midweek Musings – Mini the Minski?

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Doom and Gloom

If you think my writing is sometimes critical of the illogical and at the moment over optimistic valuation of many listed equities, especially in the USA, then find an article or video on-line by Professor Nouriel Roubini, an economist at New York Universtity’s Stern College of Business. He has been nicknamed ‘Dr Doom’.

In one of his periodic articles published last week, he referred to his expectation of a Minsky Moment. The definition of such an event was not known to me, so I looked it up, of course. Wikipedia summarises it as ‘a sudden, major collapse of asset values which marks the end of the growth phase of a cycle in credit markets or business activity’.

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Watching Brief – July 2021

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Pottering About

I have written before about my judgement that equity markets were overvalued at the end of 2019 never really getting tested because the advent of Covid-19 and the response of global governments (ie a huge stimulus of ‘free’ money) created a set of conditions that were way beyond the normal market cycle. 

I have argued since that the flow of cheap money and one other factor that I have repeatedly mentioned, the arrival of novice retail traders with new technology at their disposal, has been propelling valuations along for equity shares and some new asset classes like crypto ‘currencies’ and their plethora of proxies.

I think we have seen enough since March 2020 to come to some new conclusions.

So, how is your 2021?

Half yearly pause for thought

As inflation rears its head and there is talk of rising interest rates – see next article for some analysis of the direct impact of this – and the Covid crisis is becoming normalised in Western economies, perhaps we should consider the Covid deflection almost fully worked through?  Certainly, we must be close to the end of ‘spend, invest and be merry for tomorrow never comes’ era for governments.

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Midweek Musings – gone AWOL

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This week we have all time record day and night time temperatures where I live – up to 35C in the day time and not dropping below low 20s at night. This makes me feel very lethargic and not up to writing anything of relevance or use!

I am off to find somewhere cool!

In fact, nothing is happening that I have not already written about. Markets think central banks will act to contain inflation, then think they won’t and that little farce repeats. Regulators in the USA promise to investigate monopoly power and the monopolists spend a few spare millions lobbying to reduce any real impact. And so on.

The main point is that there is a great deal of money sloshing around and for the moment capitalism is at its most rampant.

I will be back next week with some insights, I hope! Enjoy your summer, whatever you are doing!