Perspectives
Pascal’s Wager
July, 2023
Do you believe in God? Whether you or do or do not, the seventeenth century French mathematician Blaise Pascal argued that you should, in what has become known as Pascal’s wager. If God does not exist, belief in Him leads to small, finite losses. On the other hand, if He does exist, then disbelief may […]
Picture this…
July, 2023
There was a moment in the mid-1980s when the growing demand for financial futures was such that the Chicago futures market couldn’t build the open-outcry trading areas fast enough to meet the required for trading space. The three-month Eurodollar deposit contract was particularly popular. A crush of brokers clerks and traders would balance precariously on […]
The difference between saving and investing.
July, 2023
Investor sentiment often fluctuates as financial markets oscillate through the elation of good times, (when investment returns are abundant and easy to come by), or the pain of bad times (where wealth has been adversely affected and investing can feel daunting and uncertain). It is during these bad times, where short-termism can often lead to […]
The price of everything, but the value of nothing
June, 2023
The US equity market has consistently traded at a premium to all other developed equity markets over the past 20 years. This is a difficult circle to square for many investors as history shows that higher valuations generally lead to lower future returns. We focus very much on the valuations of assets today but must […]
Tackling inflation
June, 2023
This week we had our quarterly investment conference where we review global macro-economic data with a view to gauging the impact of emerging economic trends on our investment strategies. One of the observations that came out of the meeting was that the actions taken by central banks this year to combat rising inflation are beginning […]
Banks are a lazy answer
June, 2023
Ever since the financial crisis of 2008, banks have been an easy target for many commentators, including us at times to be fair, when we talk about the ‘risks’ that might disturb investment markets. Banks are, by definition, complex, opaque businesses. Many of their revenue lines rely on them being so. If everybody knew how […]
Why did the central banks get it so wrong?
June, 2023
At a client meeting this week we were asked why the central banks have made such a hash of managing inflation over the past two years. This is an interesting question to us, as we believe the answer to this question is rooted in the global response to the financial crisis of 15 years ago. […]
Inflation is falling, just not as quickly in the UK
May, 2023
The inflation rate in the UK remains higher than in most other European countries. Interestingly, this is not the case in the US where inflation has fallen quicker and by more over the past six months. In fact, unlike in the UK and Europe, it is likely that the US inflation rate will be close […]
What is the debt ceiling in the US and why does it matter?
May, 2023
Over the past weeks there has been an issue holding back investment markets which is a US phenomenon: the debt ceiling. This is an issue peculiar to the US but it affects us all. The debt ceiling, also known as the debt limit, is the maximum amount of money that the US government can borrow […]
The Pound in Your Pocket
May, 2023
Some of our older readers may remember the Sterling crisis of 1967 and the accompanying black and white footage of Harold Wilson, then Prime Minister, explaining to the British public that this did not mean that the “Pound in your pocket or purse, or in your bank, has been devalued.” Ted Heath noted that this […]