Markets
Caution – potential ‘Black Swan’
Possibly only visible to a skilled ornithologist with the best of binoculars, there is not so far offshore a black swan detected.
To cut to the chase, as they say (although I personally deplore the hunting of birds), the potential significant, even catastrophic risk for investors is changes in the Japanese bond market.
Mid-Month Musings
As I explained in my email at the end of last year, my plan for 2026 is to post a detailed Deep Dive article as previously at the start of the month and then add another post, which will be of whatever content I think might be useful to readers, in the middle of the month. As always, I can research and write a piece on request, if any reader wants me to.
In terms of word count and read time, the longer article will be about 2500 words with a 10 to 15 minute reading time required (and perhaps complex enough to require a second look over!) and the mid-month pieces about 1000 words and only 5 minutes demanded!
This month, I have been thinking about the markets which I have a less concrete or confident opinion about. I am pretty sure that it makes sense to invest less in the USA and more in Europe and the UK and I don’t see merit in spending time on the Japanese market, so that leads me to focus on the Asia Pacific ex-Japan region and on Emerging Markets, which two sectors would have quite an overlap in a Venn diagram.
[Read more…] about Mid-Month MusingsDeep Dive – January 2026
This new year I will take a classical approach and do the look back and look forward that underlies the naming of the month.
I usually read what I wrote a year ago at the start of any new cycle but I note that I deferred offering a full opinion on the impact of Trump’s election until after his inauguration, so the blog post to reference is the one for February 2025.
My analysis of Trump’s likely behaviour was accurate in almost every detail. My expectation that the US Dollar would lose credibility was also correct. However, I did not foresee that AI would be far and away the main corporate story of the year and that the bubble I was worrying about 11 months ago would keep inflating. I was right in my expectations of a poor climate for healthcare stocks and that money would flow into defence industry shares.
So how did markets perform in 2025?
Deep Dive – December 2025
Firstly, may I wish all my readers seasonal greetings, hoping that all your Christmas preparations are going well! Most importantly, as most of us are the wrong side of pension age, I wish you the best of ongoing health!
Having written a couple of longish and quite technical pieces last month on AI and ETFs, I am going to offer a more leisurely and shorter read this month! The dive will not be so deep, more of a swim in interesting waters.
A question to which the answer may not appear to matter that much – but it does!
That question is:
Deep Dive – October 2025
When a cult rules millions
For most of my working life, I have been able to tell those who asked me that politics made not much immediate difference to investment markets. Of course, where politicians make significant changes to macro-economic conditions (say Reagan and Thatcher in the ‘80s under the influence of the monetarists and market liberalists), there will be impacts over the medium to long term.
However, as a rule markets have always taken the view that in the democratic ‘free’ world, politicians come and go and policies oscillate from a bit leftish to a bit rightish with the odd major annoying upset, like Brexit.
It is also widely understood that the most important capitalist economy, the USA, is really under the control of two main groups – a loose collective of shadowy billionaire oligarchs and the lobbying firms employed by the mega corporations. This was explained to me when I was a teenager attending college to study business and as a Brit, I struggled to believe it, but now there is some evidence (especially during the Boris Johnson period) that the same sort of democratic corrosion is occurring in the UK.
The people with the real power in the USA welcomed Trump’s re-election and the US equity market performed accordingly early this year. Here was a man who was not very bright, had only made money with the help of Russian property developers or by blatantly disreputable behaviour, when left to his own devices went bankrupt over and over again, had an ego that forever needed massaging, and was utterly free of the ethics that most people think define Christian societies.
In essence, they thought that they knew, as the KGB had discovered much earlier, that this was a man whom you could easily manipulate with a little forethought.
That was however their mistake.