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Read moreMonday Musings 05/09/2022
05/09/2022
At the time of writing, the announcement on who is to be our next PM has yet to be made, but most outlets are placing their bets firmly behind Truss and she certainly has a comfortable lead in the poles. What would her leadership look like for the markets and our investments? Certainly, the markets are facing far bigger challenges at the moment as the war in Ukraine rages on and Russia continues to disrupt access to gas supply, amongst other things. The Bank of England will be watching her first steps with interest as she has said she’d review its Mandate, which reportedly has not been properly reviewed since 1997. Despite promising that the Bank of England should not worry that she is going to interfere with its independence from Government, it’s a struggle to see what else she may wish to ‘interfere’ with, and she is, of course, being vague on the subject. Predictions are that the markets will not react well to this, but it’s hard to predict reactions when we don’t really know what the markets will be reacting to. The next few weeks will be interesting, and we will be watching….
But now. I’m afraid it’s come to that time. Yes, I feel we must. We need to talk about the kettle. Much as it sticks in my throat (keyboard?) to defend Boris even I can see he was, on this occasion, taken out of context. In a speech supporting spend on developing Nuclear Energy, on the basis of initial outlay giving longer term savings, he likened the spend to paying £20 for a new kettle and making a £10 a year (a year mind – that’s the important bit) saving on energy bills because of said kettle. Which was widely reported as home energy saving advice. It wasn’t. He supports investing in Nuclear now, to make savings long term.
Fans like me of Sir Terry Pratchett’s Discworld will recognise this as the Sam Vimes theory of Socioeconomic unfairness. Or the Old Boot theory, described in the book Men At Arms:
“The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.
But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that’d still be keeping his feet dry in ten years’ time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.”
But what has this got to do with the Monday Musings? Well, investments can be a bit like this. Outlay on the costs of maintaining quality investments might feel like a poor economic choice when times are hard and the markets are volatile. But if you’re not leaving your assets in a vehicle that has the best opportunities for long term growth and recovery, you could risk dwindling them away and losing out or paying well over the odds long term. Invest now, reap the rewards later. Get good boots.
So, to the markets,
31.12.2021 | 05.09.2022 | % Change | % Change on week | |
FTSE 100 | 7384 | 7281 | Down 1.39 | Down 1.97 |
Dow Jones | 36338 | 31318 | Down 13.8 | Down 2.99 |
Nasdaq | 15645 | 11630 | Down 25.66 | Down 4.21 |
S&P | 4766 | 3924 | Down 17.66 | Down 3.29 |
NIKKEI | 28791 | 27650 | Down 3.96 | Down 3.46 |
Hang Seng | 23398 | 19452 | Down 16.86 | Down 3.56 |
Shanghai | 3640 | 3186 | Down 12.47 | Down 1.54 |
CAC 40 | 7153 | 6167 | Down 13.78 | Down 1.70 |
DAX | 15885 | 13050 | Down 17.84 | Up 0.61 |
I had a strange encounter on Facebook this week (sounds silly, bear with me…). A new mum put a post up on a local group asking for help. She said.
Read moreAs I’m sure is the case for you, I’ve been watching the coverage of the Israel – Hamas war with horror. The loss of innocent civilian lives, the impact of.
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