Dear Mr Cameron
The old Stock Exchange Members book of 1973-74 (I'm sure your family still have a copy in your possession after your late father's exploits at Panmure Gordon & Co) has been taken from the book shelf and I'm just reminding myself of the once great market that my family were part of since 1872. You see it was a free thinking market made up primarily of people who looked after their clients (there were no account numbers or client agreements in those days), understood their roles in the support of UK business, invested freely without hindrance on instant calculating decisions (these were called hunches), gleaned that the clients came first, took for granted that investee companies behaved responsibly at all times (the rogues gallery was much smaller back then I think), calculated that balance sheets and p&l accounts were properly audited, assumed that published reports and accounts were transparent, took full responsibility for their affairs as well as those of their clients, assumed full personal UNLIMITED liability for their affairs as well as their clients and honoured ALL commitments to clients and market counterparties, took pride in the exchange that they were part of and above all enjoyed themselves in a friendly market that had the decency to look after fallen brethren through committed benovolence. DICTUM MEUM PACTUM was practiced rather than taught. Integrity at all times was paramount and could NOT be bought.
Well as you can imagine I'm not exactly ecstatic at the current exchange that your government presides over.
Today bankers, hedgies and most brokers take NO responsibility for their actions (often aided and abetted by compliance personnel whose pockets they often control), never take a financial hit for malpractice or obtuse client losses, treat shareholders with utter contempt and incredibly are still committed to a bonus culture despite the misgivings of those who feel strongly about the unlevel playing field in the workplace.
More important than any of the above though, as well as the current behaviour of the above alongside the FSA and CISI (APCIMS are the only ones who can hold their heads up at these difficult times) the most extraordinary sideshow has been the utter beligerance of the London Stock Exchange itself. On the face of it as a PLC it has done extraordinary well but sadly as an effective functioning exchange for securities representing UK PLC's, capital raising,etc the exchange is failing daily (just look at brokers volumes). There are two primary causes for this. Firstly the exchange is profiteering at the expense of investors and secondly the regulatory experiment is failing at an alarming rate. What is deeply concerning me is that virtually no-one can see this. But then again not many politicians, regulators nor indeed practititioners in the dark art and science of capital markets spotted the 2007/2008 banking crisis either. There is a secret ingredient as Chelsea FC found out by chance over the weekend. Despite countless highly paid managers their success evolved through something which one cannot find in a cv or through a qualification. No it's NOT hard work but this always helps as Mr Osborne has correctly pointed out. No, the secret ingredient is "HEART" Mr. Cameron.
It is the very heart of the exchange that concerns me. It is not ticking as it should and if there are NOT structural changes made to the exchange soon I fear that the exchange itself may suffer a serious heart attack. One of the unnerving aspects of your coalition and indeed the opposition (the culprits perhaps although the seeds were sown as far back as the 80's) is that much emphasis is placed on jobs and support given to big business BUT I see little assistance given to sole traders, small micro-partnerships and SME's. Red tape is rife and crucifying entrepreneurship everywhere and the evidence supports my belief that this started inside our very exchange largely thanks to over-regulation (TSA, SFA and now FSA towards FCA already known as "fuCA" and other hydras) since 1986. One can use the acorns to oak tree analogies till one's blue in the face but acorns everywhere are STILL being crushed by the weight of red tape, regulation, lack of investment and a host of other reasons.
It's interesting to note that in the 1973-1974 members book that there were 100's of broking firms as well as considerable numbers of jobbing firms supported by around 3,000+ members. Most of the firms supported private investors whilst maybe only a dozen or so focused their business models on the corporate market. Since 'Big Bang' the regulators have ostensibly calved up the private end of the market and evolved their very existence on governmental support and cosy relationships with the investment banks. I doubt that banks have ever really had the interest of business at 'heart' as their remits have been profit motives rather than job creativity. Conversely the core parts of the market have been reliant on private enterprise and with it private investment supported by a spiders web force of private brokers maintaining good working relationships with investors. Two things have engineered the destruction of these relationships. The first of course has been the development of the technology supporting business and industry (the internet); we all have to learn to live with the internet. The second has been (over) regulation which has broken the camels back of personal and private investing towards a mangled universe of faceless wealth managers who often than not support funds rather than actual companies. It isn't just coincidence that the AIM and Plus markets are suffering from low volumes and low interest. Long only institutions and hedge funds have no interest in supporting businesses these days and use the liquidity argument when challenged about this. Liquidity is really just a function of the market constituents and if the exchange and regulator takes away the opportunity then the market cannot support itself. It's my belief that the governement should open a debate, even an enquiry (although I doubt that practitioners such as myself would ever get invited to attend) into this BUT much worse is the FSA doctrine that is called mildly 'The Retail Distribution Review'. Thousands of brokers will be wiped out by this (including myself) whilst the new age survivors (mainly young inexperienced personnel who have questionable degrees and pointless qualifications directed around regulation) will be drawn towards funds, ETFs etc. Importantly aged investors will find it difficult dealing with these new age brokers. The average age of brokers has dramatically shifted since 1980 when I joined a private firm. Most were aged militarians and I would say the good ones were often 50+. Today I am 55 and considered ancient and out of touch with regulation. This I may be but frankly I care more about client relationships and markets than what regulators think. It's rather like driving a motor vehicle and having the steering wheel taken away these days. Compliance have the wheel and the new SUITABILITY rules and redefining of RISK are so way beyond the mark that there's every chance that more business will be driven away from UK via the internet towards softer compliance regimes.
As you can gather I dislike the regime that is at the heart of the problem. It seems that surgery is required or even a heart replacement.
My solution is simply either to refranchise the LSE (from a PLC) to private members or even better to pass an Act of Parliament allowing for a new Unlimited Liability Exchange to be created and developed by private brokers without the hindrance of external regulation (that is no FCA and no inteference from Europe). Many have suggested something similar in the past. Now is the time for leadership Mr. Cameron. UK PLC needs new direction and an exchange that supports business and industry. An exchange with "Heart" and common sense will do wonders for future generations as past generations can testify. The current exchange may be sufficient for overseas business but it is not functioning in the interests of British taxpayers or workers.
Incidentally I'm still awaiting your response to my previous communications regarding FSA and RDR. I hope that you might have the decency this time to respond to my concerns.
Yours
Richard Hoblyn
Tuesday, 22 May 2012
The Greek Solution to a global tragedy and euro-farce
As events have unfolded these past few months it has been clear to quite a few market commentators that the issues surrounding the fate of the EuroZone, the fate of the Euro, the fate of the G word (did anyone say 'growth'? what growth?), indeed the fate of capitalism in Europe following a century when there were 2 world wars is likely to be severely tested in the coming months.
The battle between left and right, left of centre and right of centre, and combinations thereon, are NOT the real issues here. Granted, the recent success of Franky Hollande in France and the rise of the left in Greece has certainly increased the tension between socialist ideaology and free-market capitalism but this is really a side show to the real problems.
Most people on Wall Street or other financial centres realise that this really is a numbers game and until the politicians start taking guidance from the markets then these tensions will persist to a possible armageddon outcome. In any event the future for the price of Gold looks supremely rosy, possibly supremely sparkling.
Today markets are faced with G8+2 = G10 (see earlier post) and possibly a few others trying to either provide damage limitation in the event of a Greek bailout (number anyone?) again or even greater damage limitation in the event of a Greek default. In either event what is quite clear is that Greece is in no position to service any form of debt, interest, instrument, roll-over of bonds, derivatives nor indeed anything as it appears to be in an unholy mess. Structurally Athens resembles a financial and fiscal armageddon. Any wealth has already exited in the direction of swiss banks, London real estate, a few greek registered tankers scattering towards the new world leaving the people in a state of confusion, bewilderment, frustration, repression and depression. There are no solutions to the Greek debt crisis simply because there are just too many opposing vested interests. An example is the estimated $100bn derivatives exposure; if Greece defaults then the counterparties, JPMorgan, Goldman Sachs, european banks, global banks, sovereign states, etc would receive an horrendous jolt leaving Wall Street nursing severe losses in equities and bonds. I could easily see a NO BID free markets scenario unfold which would make the '29 crash look like a walk in the park.
A return to the Drachma is one (only?) solution but too many other commentators are fixated on the fall out for creditors. I'm not sure that many have taken on board the full extent of the Greek tragedy here. It is necessary for Greece to start with a total clean sheet whether the ECB, G8+2 = G10, etc create some sort of orderly (in reality there's little chance of anything orderly occurring because markets will pick at the weaknesses in the process) bailout or if Greece chooses to exit either in an orderly or disorderly fashion (the most likely scenario). I was speaking to a few clients recently, many versed in Greek political and economic history better than myself, and we reminded ourselves of the 'Greek Colonel' scenario that might be unfolding shortly. Some military intervention with the purported backing of the people both in Greece and even Spain is not completely out of the question.
What is required though is a rapid and convincing case for complete and utter default along the lines of 'no negotiation for creditors', ' an instant exit from EuroZone, the Euro and the euroland fantasy', a promise from Greece to instate a credible tax universe attracting outside investors and the repatriation of Greek assets. It's likely that even then Greece would have riots, social unrest, a divided political system and in this contect it is imperative that some sort of social aid program should be proffered by IMF & "G10". Of course so long as we're all fixated on "too big to fail" and possible "contagion" doctrine nothing positive will ever happen. Politicians and regulators (basically they're the new Gestapo for the sake of anything positive to say about regulation) need to wake up and smell the coffee here asap. A quick glance at Wikipedia under 'sovereign default' should remind everyone that there have been some considerable NOT 'too big to fail' sovereign defaults combined with debt restructuring already in history; here are just some of them---Spain 1557-1596 (four times), Bourbon France after the French Revolution, Denmark 1850, Russia 1917, Confederate States after the American Civil War and more recently Argentina 1982 & 1989 and Russia 1991 & 1998. Incredibly the global tally is Africa c.39; Americas c. 150 (unbelievable statistic); Asia c.26 and Europe c. 91. In fact Greece had problems in 1826, 1843, 1860, 1893 and 1932. It's certainly worth contemplating these extraordinary statistics before anyone thinks that Greece is going to bring down capital markets, world economies and free capitalism.
The battle between left and right, left of centre and right of centre, and combinations thereon, are NOT the real issues here. Granted, the recent success of Franky Hollande in France and the rise of the left in Greece has certainly increased the tension between socialist ideaology and free-market capitalism but this is really a side show to the real problems.
Most people on Wall Street or other financial centres realise that this really is a numbers game and until the politicians start taking guidance from the markets then these tensions will persist to a possible armageddon outcome. In any event the future for the price of Gold looks supremely rosy, possibly supremely sparkling.
Today markets are faced with G8+2 = G10 (see earlier post) and possibly a few others trying to either provide damage limitation in the event of a Greek bailout (number anyone?) again or even greater damage limitation in the event of a Greek default. In either event what is quite clear is that Greece is in no position to service any form of debt, interest, instrument, roll-over of bonds, derivatives nor indeed anything as it appears to be in an unholy mess. Structurally Athens resembles a financial and fiscal armageddon. Any wealth has already exited in the direction of swiss banks, London real estate, a few greek registered tankers scattering towards the new world leaving the people in a state of confusion, bewilderment, frustration, repression and depression. There are no solutions to the Greek debt crisis simply because there are just too many opposing vested interests. An example is the estimated $100bn derivatives exposure; if Greece defaults then the counterparties, JPMorgan, Goldman Sachs, european banks, global banks, sovereign states, etc would receive an horrendous jolt leaving Wall Street nursing severe losses in equities and bonds. I could easily see a NO BID free markets scenario unfold which would make the '29 crash look like a walk in the park.
A return to the Drachma is one (only?) solution but too many other commentators are fixated on the fall out for creditors. I'm not sure that many have taken on board the full extent of the Greek tragedy here. It is necessary for Greece to start with a total clean sheet whether the ECB, G8+2 = G10, etc create some sort of orderly (in reality there's little chance of anything orderly occurring because markets will pick at the weaknesses in the process) bailout or if Greece chooses to exit either in an orderly or disorderly fashion (the most likely scenario). I was speaking to a few clients recently, many versed in Greek political and economic history better than myself, and we reminded ourselves of the 'Greek Colonel' scenario that might be unfolding shortly. Some military intervention with the purported backing of the people both in Greece and even Spain is not completely out of the question.
What is required though is a rapid and convincing case for complete and utter default along the lines of 'no negotiation for creditors', ' an instant exit from EuroZone, the Euro and the euroland fantasy', a promise from Greece to instate a credible tax universe attracting outside investors and the repatriation of Greek assets. It's likely that even then Greece would have riots, social unrest, a divided political system and in this contect it is imperative that some sort of social aid program should be proffered by IMF & "G10". Of course so long as we're all fixated on "too big to fail" and possible "contagion" doctrine nothing positive will ever happen. Politicians and regulators (basically they're the new Gestapo for the sake of anything positive to say about regulation) need to wake up and smell the coffee here asap. A quick glance at Wikipedia under 'sovereign default' should remind everyone that there have been some considerable NOT 'too big to fail' sovereign defaults combined with debt restructuring already in history; here are just some of them---Spain 1557-1596 (four times), Bourbon France after the French Revolution, Denmark 1850, Russia 1917, Confederate States after the American Civil War and more recently Argentina 1982 & 1989 and Russia 1991 & 1998. Incredibly the global tally is Africa c.39; Americas c. 150 (unbelievable statistic); Asia c.26 and Europe c. 91. In fact Greece had problems in 1826, 1843, 1860, 1893 and 1932. It's certainly worth contemplating these extraordinary statistics before anyone thinks that Greece is going to bring down capital markets, world economies and free capitalism.
Monday, 21 May 2012
G8+2 = G10
Like many millions of people globally I was transfixed at the weekend by two seismic events. The first was a certain soccer match in Munich and the other was Obama's tea party at Camp David, Maryland, which by coincidence seemed to get more newsreel through it's watching of the said clash between Germany (Merkel) and UK (Cameron; note Osborne was spotted a few seats along the line from Michel Platini at the match) than the real matters of state. Watching the brief news item on the G8 around an Arthurian Round Table I took a double take. Who are the G8? Well I recognised most of them but wasn't sure who the asian gentleman was, was he a chinese leader or perhaps japanese? On closer examination I discovered that he was the Japanese PM. And then it hit me.
None of these people can count.
I'm sure millions of kindergarten children would have spotted this but '00s of market commentators who are paraded daily on Bloomberg, CNBC, BBC, CNN, Russia Today, France24, etc all appear to have failed to appreciate the simple error as well as the supreme irony in this algebric miscalculation. In a world that is reeling from bad balance sheets, derivative black holes, bond issuances, QE, Tarp it is almost unimaginable that no journalist could have spotted the obvious error either.
The G8 is in fact "G8+2 = G10" or if you're a eurocrat simply "G10".
It would appear that Mr Putin could see the elementary futility of the 'cheap seats' tea party at the camp so he sent his sidekick along, PM Medvedev, who by all accounts was having a jolly time with DaveCam.
The accounting error (that is the '2' aspect to the complicated mathematical equation) apparently has been described as 'off balance sheet' by the Federal Reserve (sic!) & Goldman Sachs (sic 2!) but for clarity at least one present was an unelected politician Van Rompuy who Nigel Farage has had in his sights for some time and the other being Barroso. Of course Italy's Monti is unelected too but that's a minor issue to the greater accounting error.
So now can we please refer to this pact as the "G8+2 = G10" aka "G10".
None of these people can count.
I'm sure millions of kindergarten children would have spotted this but '00s of market commentators who are paraded daily on Bloomberg, CNBC, BBC, CNN, Russia Today, France24, etc all appear to have failed to appreciate the simple error as well as the supreme irony in this algebric miscalculation. In a world that is reeling from bad balance sheets, derivative black holes, bond issuances, QE, Tarp it is almost unimaginable that no journalist could have spotted the obvious error either.
The G8 is in fact "G8+2 = G10" or if you're a eurocrat simply "G10".
It would appear that Mr Putin could see the elementary futility of the 'cheap seats' tea party at the camp so he sent his sidekick along, PM Medvedev, who by all accounts was having a jolly time with DaveCam.
The accounting error (that is the '2' aspect to the complicated mathematical equation) apparently has been described as 'off balance sheet' by the Federal Reserve (sic!) & Goldman Sachs (sic 2!) but for clarity at least one present was an unelected politician Van Rompuy who Nigel Farage has had in his sights for some time and the other being Barroso. Of course Italy's Monti is unelected too but that's a minor issue to the greater accounting error.
So now can we please refer to this pact as the "G8+2 = G10" aka "G10".
Thursday, 12 April 2012
Review 1 Q 2012 11th April 2012
"Gold has worked down from Alexander's time.....When something holds good for two thousand years, I do not believe it can be so because of prejudice or mistaken theory." -Bernard Baruch, Wall Street legend & friend of Jesse Livermore
The over-exuberance in blue chip equities in the 1 Q 2012 has as I write stalled as a reality check is now taking place. It has not been an easy market so far this year with virtually all the bull commentators being paraded up and down on our screens with hopes for growth and recovery. Fortunately many clients and market professionals that I communicate with have taken these prophecies with a pinch of salt. There are many causes for my extreme caution but at the forefront it must be the state of the EU as more pressure is applied to (10 year) bond yields. Austerity measures may be good for politicians but the real effects are that there can be little job creation without substantial investment, better tax incentives for businesses and taking a scythe to red tape and regulation. The latter in particular has been ignored by politicians as SME’s and self-employed (“libres professionnels”) struggle to actually do what their skills are designed for. No-one has broadcast any statistics on how much time is spent per day on all this red tape but my guess is that it is now around 30% of everyone’s day and rising inextricably. In essence thousands of wasted man hours are unproductive which in the end cannot be good for the recovery phase or capitalism per se. The completely ineffective attempt to cut the Public Sector purse in the UK is just an example of the ineptness of the western systems that everyone knows are now creaking at the hinges. From an investing standpoint it would appear that CASH is KING at this critical time as the impending Sputnik Moment for bond markets approaches. It amazes me why so many are scampering for 2% yields (in a universe where inflation is 4 to 5% official) and why so many market people seem to think that Italian and Spanish bond yields in the 6% area are already so damaging (going much higher). Was it that long ago that War Loan yielded 10%+ or that mortgage rates in UK were in the mid-teens? It does seem that traders and their trading mentality appear to be ruling markets still and now the heads of many investors too. My own view is that equities may yield 3%+ in places right now, with large int’l companies throwing off cash at almost unprecedented levels, but this is NOT a good enough reason to chase current share prices against a potentially cataclysmic debacle that might occur in the (f/x, bond & equity) markets gyrating into much much higher bond yields (my own forecast for Italy/Spain 10 year bond yields is 20%+ this year). The risk/reward ratio is just too imbalanced for me at this stage of the QE/Operation Twist process(es) and I’d rather hold precious metals and oil stocks despite the pain that they have suffered to date. As I write FTSE100 is around 5,630 (c.300 points off the high) and the DJIA at 12,715 (from c.13,000). This is hardly a big correction so far so there’s quite some downside if things in EU do get worse hereon. The China slowdown is not helping either with current GDP growth of c.9% forecast to drop to 7½% but the real problem there is the construction/property bubble which has got to epic proportions. With over 500 million in the Chinese workforce there are just too many properties constructed and being developed. The over-supply has already led to some spectacular falls in prices (-35% in Beijing last November) and further pressure is predicted. In fact elsewhere Citibank has just suggested that US prices are also 25% over-valued today even after severe falls there. You don’t need me to tell you how I feel about UK property prices. Did I mention the geopolitical developments in the Middle East? Syria, Turkey, Iran, Egypt, Bahrain, Yemen…..well, the list goes on and on. There’s no need to mention the ‘c’ word in Africa either. They’ve been having ‘coups’ there for decades since the imperialists departed. Just in the last year Randgold Resources has had its share price slump at the mercy of shenanigans in the Ivory Coast and more recently Mali where it has 2/3 of its gold operations. But of course the terrain and behavioural patterns are the norm for the Dark Continent. Not so elsewhere in the more developed universe. It wouldn’t surprise me if the Colonels have the last say in Athens or even Madrid.
Reminding ourselves of Bernard Baruch’s famous quote for a minute only leaves me to continue to focus on gold (Randgold, African Barrick, Shanta are all trading too cheaply), oil shares (Royal Dutch Shell at 2180p is getting close to sub-£20 and I’d like to see BP nearer to £4), the old frontiers of Africa (although it’s RISK OFF right now) and other emerging markets (I still prefer Russia and Brazil), solid international investment trusts on pull backs and up to 25% holding cash (in a mix of currencies in addition to £stg & US$) but avoiding the Euro (still). The oil price is still impossible to predict as it appears to have found its range for the short-term but shortages at the pumps are going to become the norm I suspect.
With regard to other specific stock selections I like the look of mid-tier oils such as Premier Oil, Heritage Oil, Hardy O&G, Soco Int’l, Exillion, Chariot O&G and Genel who remain out of favour. In FTSE I’d prefer to look at BAE Systems nearer 260p, GlaxoSmithKline nearer £13, Sainsbury nearer 265p, HSBC nearer 460p and Standard Chartered nearer £12. My 2012 tip Tullett Prebon now near 350p is getting overbought (prefer to buy below £3) although is still a HOLD on takeover hopes. Amongst investment trusts I think purchasing the following on a 10%+ markets correction may be prudent; JPMorgan Claverhouse, Henderson Far East, Schroder Oriental, Securities Trust of Scotland, Merchants Trust and JPMorgan Global Emerging Income. As far as the rest of the UK market is concerned I’m being very selective and prefer international equities but it’s important to avoid those with too much exposure to China, general commodities and anything financial or consumer related. With around 30% of FTSE100 constituents exposed in China it may be prudent to avoid those with connections there. Who knows but the China slump could be the big surprise around the corner.
I continue to encourage portfolio weightings such as 0% Fixed Interest, 20-35% cash, maximum 80% equities (overseas earners mainly incl. 25%-40% in precious metals stocks, a spread of investment trusts). Much has been discussed recently regarding safe havens and the safety of ETF’s and I continue to avoid these vehicles for private investors as I believe there are major regulatory concerns in this area. The level of the coming correction is the key and I still feel that 10-30% is possible which implies 4,776 (20% from 5,970 recent high) on FTSE100. Looking at what happened in the mid-1930’s it’s interesting to note that US$10,000 invested in DJIA in Oct 1929 would have turned into US$3,600 by Dec 1935 whereas the same amount invested in Homestake Mining, a gold miner, grew to US$62,000 i.e 6.2x. During the 1973/74 slump when stocks depreciated over 50% the large gold cap stocks increased 260%+. If the precious metals shares bull does return then spectacular returns could be achieved in the foreseeable future with some of the gold shares already purchased. Many are suggesting that comparisons are unfair with the ‘30s but history has a funny habit of repeating itself. GFMS, the precious metals research group, have just predicted that a looming flare-up in the Eurozone will propel the price of gold towards $2,000 an ounce this year. Exactly!
“Hasta la vista”…….as Spain (it’s debt dwarfs Greece, Italy and the other fringe players) gets nearer to the markets sights the phrase seems more than appropriate.
Let’s hope that Spring doesn’t disappoint.
The over-exuberance in blue chip equities in the 1 Q 2012 has as I write stalled as a reality check is now taking place. It has not been an easy market so far this year with virtually all the bull commentators being paraded up and down on our screens with hopes for growth and recovery. Fortunately many clients and market professionals that I communicate with have taken these prophecies with a pinch of salt. There are many causes for my extreme caution but at the forefront it must be the state of the EU as more pressure is applied to (10 year) bond yields. Austerity measures may be good for politicians but the real effects are that there can be little job creation without substantial investment, better tax incentives for businesses and taking a scythe to red tape and regulation. The latter in particular has been ignored by politicians as SME’s and self-employed (“libres professionnels”) struggle to actually do what their skills are designed for. No-one has broadcast any statistics on how much time is spent per day on all this red tape but my guess is that it is now around 30% of everyone’s day and rising inextricably. In essence thousands of wasted man hours are unproductive which in the end cannot be good for the recovery phase or capitalism per se. The completely ineffective attempt to cut the Public Sector purse in the UK is just an example of the ineptness of the western systems that everyone knows are now creaking at the hinges. From an investing standpoint it would appear that CASH is KING at this critical time as the impending Sputnik Moment for bond markets approaches. It amazes me why so many are scampering for 2% yields (in a universe where inflation is 4 to 5% official) and why so many market people seem to think that Italian and Spanish bond yields in the 6% area are already so damaging (going much higher). Was it that long ago that War Loan yielded 10%+ or that mortgage rates in UK were in the mid-teens? It does seem that traders and their trading mentality appear to be ruling markets still and now the heads of many investors too. My own view is that equities may yield 3%+ in places right now, with large int’l companies throwing off cash at almost unprecedented levels, but this is NOT a good enough reason to chase current share prices against a potentially cataclysmic debacle that might occur in the (f/x, bond & equity) markets gyrating into much much higher bond yields (my own forecast for Italy/Spain 10 year bond yields is 20%+ this year). The risk/reward ratio is just too imbalanced for me at this stage of the QE/Operation Twist process(es) and I’d rather hold precious metals and oil stocks despite the pain that they have suffered to date. As I write FTSE100 is around 5,630 (c.300 points off the high) and the DJIA at 12,715 (from c.13,000). This is hardly a big correction so far so there’s quite some downside if things in EU do get worse hereon. The China slowdown is not helping either with current GDP growth of c.9% forecast to drop to 7½% but the real problem there is the construction/property bubble which has got to epic proportions. With over 500 million in the Chinese workforce there are just too many properties constructed and being developed. The over-supply has already led to some spectacular falls in prices (-35% in Beijing last November) and further pressure is predicted. In fact elsewhere Citibank has just suggested that US prices are also 25% over-valued today even after severe falls there. You don’t need me to tell you how I feel about UK property prices. Did I mention the geopolitical developments in the Middle East? Syria, Turkey, Iran, Egypt, Bahrain, Yemen…..well, the list goes on and on. There’s no need to mention the ‘c’ word in Africa either. They’ve been having ‘coups’ there for decades since the imperialists departed. Just in the last year Randgold Resources has had its share price slump at the mercy of shenanigans in the Ivory Coast and more recently Mali where it has 2/3 of its gold operations. But of course the terrain and behavioural patterns are the norm for the Dark Continent. Not so elsewhere in the more developed universe. It wouldn’t surprise me if the Colonels have the last say in Athens or even Madrid.
Reminding ourselves of Bernard Baruch’s famous quote for a minute only leaves me to continue to focus on gold (Randgold, African Barrick, Shanta are all trading too cheaply), oil shares (Royal Dutch Shell at 2180p is getting close to sub-£20 and I’d like to see BP nearer to £4), the old frontiers of Africa (although it’s RISK OFF right now) and other emerging markets (I still prefer Russia and Brazil), solid international investment trusts on pull backs and up to 25% holding cash (in a mix of currencies in addition to £stg & US$) but avoiding the Euro (still). The oil price is still impossible to predict as it appears to have found its range for the short-term but shortages at the pumps are going to become the norm I suspect.
With regard to other specific stock selections I like the look of mid-tier oils such as Premier Oil, Heritage Oil, Hardy O&G, Soco Int’l, Exillion, Chariot O&G and Genel who remain out of favour. In FTSE I’d prefer to look at BAE Systems nearer 260p, GlaxoSmithKline nearer £13, Sainsbury nearer 265p, HSBC nearer 460p and Standard Chartered nearer £12. My 2012 tip Tullett Prebon now near 350p is getting overbought (prefer to buy below £3) although is still a HOLD on takeover hopes. Amongst investment trusts I think purchasing the following on a 10%+ markets correction may be prudent; JPMorgan Claverhouse, Henderson Far East, Schroder Oriental, Securities Trust of Scotland, Merchants Trust and JPMorgan Global Emerging Income. As far as the rest of the UK market is concerned I’m being very selective and prefer international equities but it’s important to avoid those with too much exposure to China, general commodities and anything financial or consumer related. With around 30% of FTSE100 constituents exposed in China it may be prudent to avoid those with connections there. Who knows but the China slump could be the big surprise around the corner.
I continue to encourage portfolio weightings such as 0% Fixed Interest, 20-35% cash, maximum 80% equities (overseas earners mainly incl. 25%-40% in precious metals stocks, a spread of investment trusts). Much has been discussed recently regarding safe havens and the safety of ETF’s and I continue to avoid these vehicles for private investors as I believe there are major regulatory concerns in this area. The level of the coming correction is the key and I still feel that 10-30% is possible which implies 4,776 (20% from 5,970 recent high) on FTSE100. Looking at what happened in the mid-1930’s it’s interesting to note that US$10,000 invested in DJIA in Oct 1929 would have turned into US$3,600 by Dec 1935 whereas the same amount invested in Homestake Mining, a gold miner, grew to US$62,000 i.e 6.2x. During the 1973/74 slump when stocks depreciated over 50% the large gold cap stocks increased 260%+. If the precious metals shares bull does return then spectacular returns could be achieved in the foreseeable future with some of the gold shares already purchased. Many are suggesting that comparisons are unfair with the ‘30s but history has a funny habit of repeating itself. GFMS, the precious metals research group, have just predicted that a looming flare-up in the Eurozone will propel the price of gold towards $2,000 an ounce this year. Exactly!
“Hasta la vista”…….as Spain (it’s debt dwarfs Greece, Italy and the other fringe players) gets nearer to the markets sights the phrase seems more than appropriate.
Let’s hope that Spring doesn’t disappoint.
Wednesday, 18 January 2012
Hello Prime Minister, is anyone in today?
Dear Prime Minister
I'm sure you're getting alot of letters at the moment but I'd appreciate just a minute of your time. You see, I've just seen you standing at the despatch box hammering home to the opposition your parties intent on job creation and presumably job retention. You appear to be very passionate about 'jobs' and if this is true I was wondering why you hadn't bothered to respond to my earlier letter to you dated 18th August 2011 headlined "Financial Tsunami heading for the City of London". It's not that I mind being ignored or indeed being fobbed off after years of dedicated service to my stock exchange colleagues and clients but I would just like to hear your explanation as to why you and your party consider it necessary to force literally '000s out of financial services as a result of a piece of nonsensical doctrine called "The Retail Distribution Review".
What is incredible about this RDR is that so many (perhaps pickled!) new age financial services personnel think that the RDR is just tickedyboo but I can assure you that the swell of a tsunami is brewing somewhere beyond the Thames Estuary. Just like the Poll Tax and the Child Support Agency it is quite clear to many experienced financial services personnel that RDR & all it stands for is going to be nothing short of a major disaster for the City of London.
The confusion surrounding Restricted and Independent advice and service is frankly just a sideshow to the real scandal whereby the FSA are trying to shift the entire investment map towards a 'fee based' system, wiping out in the process '000s of decent honest people in an orwellian examination process which is woefully misguided. Ironically it is the banks and former bankers who have entered the wealth industry who are likely to benefit the most. Perhaps this is deliberate and if so surely someone in charge can spot the dubious futility of allowing bankers another gear change; their record has not been that good to date although admittedly spectacular..
Picture this Prime Minister. If the members of the House were over-regulated, and there are many in UK hoping for something along these lines, and a doctrine was devised whereby you would have to prove to your esteemed colleagues and constituent supporters your professional and public competence so that you would be forced to go back to school, take laborious examinations and be subjected to a humiliating visit to The Job Centre then I suggest you might be as incensed as I am by the current behaviour in the City of London.
Nothing good will come from RDR and by splitting the regulator into four pieces I fear more hydra's will evolve. Meanwhile have some sympathy for the innocent hard working people effected by this, their families and 10's of '000s of clients mesmorised by this appalling arrogance. Democracy and fair play used to be a by-word of how the City used to operate. It also used to be what the old Tory party stood for.
Your once obediant servant,
Richard Hoblyn
I'm sure you're getting alot of letters at the moment but I'd appreciate just a minute of your time. You see, I've just seen you standing at the despatch box hammering home to the opposition your parties intent on job creation and presumably job retention. You appear to be very passionate about 'jobs' and if this is true I was wondering why you hadn't bothered to respond to my earlier letter to you dated 18th August 2011 headlined "Financial Tsunami heading for the City of London". It's not that I mind being ignored or indeed being fobbed off after years of dedicated service to my stock exchange colleagues and clients but I would just like to hear your explanation as to why you and your party consider it necessary to force literally '000s out of financial services as a result of a piece of nonsensical doctrine called "The Retail Distribution Review".
What is incredible about this RDR is that so many (perhaps pickled!) new age financial services personnel think that the RDR is just tickedyboo but I can assure you that the swell of a tsunami is brewing somewhere beyond the Thames Estuary. Just like the Poll Tax and the Child Support Agency it is quite clear to many experienced financial services personnel that RDR & all it stands for is going to be nothing short of a major disaster for the City of London.
The confusion surrounding Restricted and Independent advice and service is frankly just a sideshow to the real scandal whereby the FSA are trying to shift the entire investment map towards a 'fee based' system, wiping out in the process '000s of decent honest people in an orwellian examination process which is woefully misguided. Ironically it is the banks and former bankers who have entered the wealth industry who are likely to benefit the most. Perhaps this is deliberate and if so surely someone in charge can spot the dubious futility of allowing bankers another gear change; their record has not been that good to date although admittedly spectacular..
Picture this Prime Minister. If the members of the House were over-regulated, and there are many in UK hoping for something along these lines, and a doctrine was devised whereby you would have to prove to your esteemed colleagues and constituent supporters your professional and public competence so that you would be forced to go back to school, take laborious examinations and be subjected to a humiliating visit to The Job Centre then I suggest you might be as incensed as I am by the current behaviour in the City of London.
Nothing good will come from RDR and by splitting the regulator into four pieces I fear more hydra's will evolve. Meanwhile have some sympathy for the innocent hard working people effected by this, their families and 10's of '000s of clients mesmorised by this appalling arrogance. Democracy and fair play used to be a by-word of how the City used to operate. It also used to be what the old Tory party stood for.
Your once obediant servant,
Richard Hoblyn
Thursday, 5 January 2012
Review 4Q 2011 4th January 2012
“Markets today are ‘one big giant ETF’ (Exchange Traded Fund).” -Joe Saluzzi of Themis Trading in New York on Bloomberg TV 21st December 2011
Over the last few years there has clearly been a disconnect in capital markets between how stocks should behave based on solid earnings numbers and the short-term behaviour of traders and market makers who appear to be often in a different universe to investors and money managers. The interview with Joe Saluzzi confirmed my suspicions that computer generated trading based on algarithms has now created a tail wagging scenario that is unhealthy for capitalism. The interview comments on the thin layer of liquidity in capital markets, the influence of circuit breakers, hyper-second trading, the lack of IPO’s and concludes that another ‘flash crash’ (defined as a quick 10-15 minute correction of >10%) as witnessed on 6th May could indeed occur quite soon. All the hallmarks for this are in place as the world focuses on the EuroZone and its difficulties. But there are, of course, other possible black swan events out there such as Iran or North Korea (some more sabre rattling is predicted with their cousins in the south) as well as a harder landing for China. The year 2011 indeed was a very dark year for investors (even Buffett’s Berkshire Hathaway was -4.7%) but I doubt 2012 will be that different. Of course the thought of 50% of The Beatles (possibly) opening the festivities at the London Olympics might just freshen up investors later in the summer but some nasty events could occur in 1 H 2012.
As I write the bankers at UniCredit in Italy are undertaking a 43% discounted Euros7.5bn rights issue. Their timing surprisingly is quite good as markets are currently looking for some New Year ‘Vim’ (Latin for ‘strength’, hence the old advert adage “Vim gives new strength to your wash”) but of course the real reason relates to what is and has been happening in bond markets over the festive period. Most main parties in the EuroZone have tested the waters ahead of what is likely to be a problematic period. To date Germany, Spain, France & Italy have already issued some bonds ahead of the bigger roll-overs scheduled mainly for February/March. The big question though is whether the current yields of 4-7% offer investors ample reward and whether these roll-overs can get filled. Any further hiccup in the EuroZone could easily send potential investors to the sidelines and continue the Euro’s slide into eventual oblivion. As an aside I saw one shop on my local French channel just last night accepting the ‘old’ french Franc from customers; maybe they know something markets don’t! Again as I write this an email has just dropped in from an institutional contact in Geneva suggesting that Greece has threatened to exit the EuroZone within 3 months unless Euros130billion as promised in October is forthcoming. It’s already hotting up then!
Alot of what has already been discussed throughout 2011 and beforehand is coming to a head. The predicted second banking crisis still appears to be around the corner as especially EuroZone banks try to strengthen their capital ratios ahead of Basle. Sarkozy and Merkel seem to be continuing their dinner dates (much amusement on YouTube) and politics again seems to be taking the spotlight away from the economic reality show. In the EuroZone negative growth is forecast (France 1 Q 12 estimate is -0.1% GDP contraction) whilst in UK a trawl along the bottom is likely as consumers feel the pinch (just look at Next today). The recession continually being discussed in the media appears to be here already. The old derivatives timebomb is still ticking as the global exposure again reaches US$700 trillion. The issues over credit ratings never disappear with France on permanent watch; how long can it be before the 3 main agencies sharpen their swords on France and Spain? There is ,however, some sparkle in the US economy despite the 8.6% official US unemployment rate (15-20% unofficially); the consensus S&P forecast does look encouraging though at +7.2% but these same forecasters got most of their 2011 forecasts hopelessly wrong. Having said that the US$ greenback and markets do provide some short-term protection from the Euro & £sterling although nothing whatsoever tempts me to buy US Treasuries on a yield below 2% (against inflation of circa 4-5%) and a budget deficit of now alarmingly US$15trillion +.
Indeed the only credible and sensible investment themes for 2012 are to continue to buy gold in one form or another, oil shares (I still expect some rotation out of Royal Dutch Shell into BP and other majors at some juncture), Africa and other emerging markets (I particularly like Russia and Brazil in preference to India and China), solid international investment trusts, New Capital Wealthy Nations Bond Fund (over 7%) and up to 25% holding cash (in a mix of currencies in addition to £stg & US$) but avoiding the Euro at all costs. The oil price could be the surprise package this year and could trade in $85-120 range; any fall hereon could well kick start the US economy and ignite already moderately positive US earnings which is why forecasters are bullish. I’m not convinced by this argument though which is why I prefer to remain relatively liquid. Our friends in Iran could well throw a spanner in the works if the current aircraft carrier jibes are anything to be taken seriously…which they are.
It remains to be seen whether the EuroZone, the ECB, the IMF & EFSF (European Financial Stability Fund) et al can work efficiently together and possibly gain enough momentum to raise enough Euros to bail the debtors out, in the right order. It’s possible that up to Euros3trillion could be QE’d but this must be done in cohesion without individual sovereign and bank failures.
With regard to stock selection amongst the oil majors I still continue to look to buy Royal Dutch Shell at closer to £16-20 & BP on dips nearer £4. Amongst oils I like the look of Ophir (having taken over Dominion), Exillion and even possibly Essar provides some value here. Vallares are now Genel and are out of favour in the short-term; more excitement from Hayward and Nat Rothschild though is expected. All the smaller explorers such as Soco, Hardy O&G, Premier Oil and Heritage should start to respond as the year progresses. Amongst gas stories I like Encana at under $20 and notice that there is some impending excitement amongst other Canadian gas plays (Edge Resources is due to arrive on AIM shortly). Elsewhere in FTSE as usual I am extremely cautious although some previous targets to buy at have been reached. I’d prefer to look at BAE Systems nearer 260p, GlaxoSmithKline nearer £13, Sainsbury nearer 265p, HSBC nearer 460p and Standard Chartered nearer £12. My preferred 2011/2012 tip is the inter-dealer/broker Tullett Prebon and at 271p yielding over 5.7% this is still a compelling buy being a possible takeover candidate too. Selectively an investment trust approach seems more prudent and investments in JPMorgan Claverhouse, Henderson Far East, Schroder Oriental, Securities Trust of Scotland and Merchants Trust are still compelling for income investors whereas emerging markets trusts such as JPMorgan India, JPMorgan Brazil, JPMorgan Russia and BlackRock Latin could also be considered. There isn’t a suitable trust for the Final Frontier, Africa so a selected basket of equities is preferred here. In particular I still like Randgold, African Barrick, Afren and Shanta. Elsewhere globally I am still persevering with Patagonia Gold, Orosur, Peninsular and Anglo Pacific remains a classic royalty play that provides some variety. As far as the rest of the UK market is concerned I’m being very selective and prefer international equities.
With sideways volatility again expected during 2012 I continue to encourage portfolio weightings such as 0% Fixed Interest (a bond implosion is forecast), 20-35% cash, maximum 80% equities (overseas earners mainly incl. 25%-40% in precious metals stocks, a spread of investment trusts). Again it’s important to restress that investors are entering an era where stagnant growth (& contraction) in the west could be offset by continued growth in emerging and frontiers markets. The correlation between deflation and inflation needs to be watched closely which is why there’s a growing case for increasing equity exposure especially on any decline across markets. The level of the coming decline is the key and I still feel that 10-30% is possible which implies 4,450 on FTSE100. I think we are about to witness the SPUTNIK MOMENT as has already been predicted. The contrarian view of course is if the EU & US manages to convince markets that a continued bumbling QE practice should be the order of the day. If that happens then expect a much higher S&P and a similar review this time next year predicting the demise of the Euro (again). There are alarming similarities with 1930-1933 which are coming to fruition.
If the Liverpool likely lads do put on a prescribed sensation at the Olympics opening ceremony then Team GB can do no wrong even if no Golds are achieved.
However, 2012 will indeed be a “Long & Winding Road!.......................
Over the last few years there has clearly been a disconnect in capital markets between how stocks should behave based on solid earnings numbers and the short-term behaviour of traders and market makers who appear to be often in a different universe to investors and money managers. The interview with Joe Saluzzi confirmed my suspicions that computer generated trading based on algarithms has now created a tail wagging scenario that is unhealthy for capitalism. The interview comments on the thin layer of liquidity in capital markets, the influence of circuit breakers, hyper-second trading, the lack of IPO’s and concludes that another ‘flash crash’ (defined as a quick 10-15 minute correction of >10%) as witnessed on 6th May could indeed occur quite soon. All the hallmarks for this are in place as the world focuses on the EuroZone and its difficulties. But there are, of course, other possible black swan events out there such as Iran or North Korea (some more sabre rattling is predicted with their cousins in the south) as well as a harder landing for China. The year 2011 indeed was a very dark year for investors (even Buffett’s Berkshire Hathaway was -4.7%) but I doubt 2012 will be that different. Of course the thought of 50% of The Beatles (possibly) opening the festivities at the London Olympics might just freshen up investors later in the summer but some nasty events could occur in 1 H 2012.
As I write the bankers at UniCredit in Italy are undertaking a 43% discounted Euros7.5bn rights issue. Their timing surprisingly is quite good as markets are currently looking for some New Year ‘Vim’ (Latin for ‘strength’, hence the old advert adage “Vim gives new strength to your wash”) but of course the real reason relates to what is and has been happening in bond markets over the festive period. Most main parties in the EuroZone have tested the waters ahead of what is likely to be a problematic period. To date Germany, Spain, France & Italy have already issued some bonds ahead of the bigger roll-overs scheduled mainly for February/March. The big question though is whether the current yields of 4-7% offer investors ample reward and whether these roll-overs can get filled. Any further hiccup in the EuroZone could easily send potential investors to the sidelines and continue the Euro’s slide into eventual oblivion. As an aside I saw one shop on my local French channel just last night accepting the ‘old’ french Franc from customers; maybe they know something markets don’t! Again as I write this an email has just dropped in from an institutional contact in Geneva suggesting that Greece has threatened to exit the EuroZone within 3 months unless Euros130billion as promised in October is forthcoming. It’s already hotting up then!
Alot of what has already been discussed throughout 2011 and beforehand is coming to a head. The predicted second banking crisis still appears to be around the corner as especially EuroZone banks try to strengthen their capital ratios ahead of Basle. Sarkozy and Merkel seem to be continuing their dinner dates (much amusement on YouTube) and politics again seems to be taking the spotlight away from the economic reality show. In the EuroZone negative growth is forecast (France 1 Q 12 estimate is -0.1% GDP contraction) whilst in UK a trawl along the bottom is likely as consumers feel the pinch (just look at Next today). The recession continually being discussed in the media appears to be here already. The old derivatives timebomb is still ticking as the global exposure again reaches US$700 trillion. The issues over credit ratings never disappear with France on permanent watch; how long can it be before the 3 main agencies sharpen their swords on France and Spain? There is ,however, some sparkle in the US economy despite the 8.6% official US unemployment rate (15-20% unofficially); the consensus S&P forecast does look encouraging though at +7.2% but these same forecasters got most of their 2011 forecasts hopelessly wrong. Having said that the US$ greenback and markets do provide some short-term protection from the Euro & £sterling although nothing whatsoever tempts me to buy US Treasuries on a yield below 2% (against inflation of circa 4-5%) and a budget deficit of now alarmingly US$15trillion +.
Indeed the only credible and sensible investment themes for 2012 are to continue to buy gold in one form or another, oil shares (I still expect some rotation out of Royal Dutch Shell into BP and other majors at some juncture), Africa and other emerging markets (I particularly like Russia and Brazil in preference to India and China), solid international investment trusts, New Capital Wealthy Nations Bond Fund (over 7%) and up to 25% holding cash (in a mix of currencies in addition to £stg & US$) but avoiding the Euro at all costs. The oil price could be the surprise package this year and could trade in $85-120 range; any fall hereon could well kick start the US economy and ignite already moderately positive US earnings which is why forecasters are bullish. I’m not convinced by this argument though which is why I prefer to remain relatively liquid. Our friends in Iran could well throw a spanner in the works if the current aircraft carrier jibes are anything to be taken seriously…which they are.
It remains to be seen whether the EuroZone, the ECB, the IMF & EFSF (European Financial Stability Fund) et al can work efficiently together and possibly gain enough momentum to raise enough Euros to bail the debtors out, in the right order. It’s possible that up to Euros3trillion could be QE’d but this must be done in cohesion without individual sovereign and bank failures.
With regard to stock selection amongst the oil majors I still continue to look to buy Royal Dutch Shell at closer to £16-20 & BP on dips nearer £4. Amongst oils I like the look of Ophir (having taken over Dominion), Exillion and even possibly Essar provides some value here. Vallares are now Genel and are out of favour in the short-term; more excitement from Hayward and Nat Rothschild though is expected. All the smaller explorers such as Soco, Hardy O&G, Premier Oil and Heritage should start to respond as the year progresses. Amongst gas stories I like Encana at under $20 and notice that there is some impending excitement amongst other Canadian gas plays (Edge Resources is due to arrive on AIM shortly). Elsewhere in FTSE as usual I am extremely cautious although some previous targets to buy at have been reached. I’d prefer to look at BAE Systems nearer 260p, GlaxoSmithKline nearer £13, Sainsbury nearer 265p, HSBC nearer 460p and Standard Chartered nearer £12. My preferred 2011/2012 tip is the inter-dealer/broker Tullett Prebon and at 271p yielding over 5.7% this is still a compelling buy being a possible takeover candidate too. Selectively an investment trust approach seems more prudent and investments in JPMorgan Claverhouse, Henderson Far East, Schroder Oriental, Securities Trust of Scotland and Merchants Trust are still compelling for income investors whereas emerging markets trusts such as JPMorgan India, JPMorgan Brazil, JPMorgan Russia and BlackRock Latin could also be considered. There isn’t a suitable trust for the Final Frontier, Africa so a selected basket of equities is preferred here. In particular I still like Randgold, African Barrick, Afren and Shanta. Elsewhere globally I am still persevering with Patagonia Gold, Orosur, Peninsular and Anglo Pacific remains a classic royalty play that provides some variety. As far as the rest of the UK market is concerned I’m being very selective and prefer international equities.
With sideways volatility again expected during 2012 I continue to encourage portfolio weightings such as 0% Fixed Interest (a bond implosion is forecast), 20-35% cash, maximum 80% equities (overseas earners mainly incl. 25%-40% in precious metals stocks, a spread of investment trusts). Again it’s important to restress that investors are entering an era where stagnant growth (& contraction) in the west could be offset by continued growth in emerging and frontiers markets. The correlation between deflation and inflation needs to be watched closely which is why there’s a growing case for increasing equity exposure especially on any decline across markets. The level of the coming decline is the key and I still feel that 10-30% is possible which implies 4,450 on FTSE100. I think we are about to witness the SPUTNIK MOMENT as has already been predicted. The contrarian view of course is if the EU & US manages to convince markets that a continued bumbling QE practice should be the order of the day. If that happens then expect a much higher S&P and a similar review this time next year predicting the demise of the Euro (again). There are alarming similarities with 1930-1933 which are coming to fruition.
If the Liverpool likely lads do put on a prescribed sensation at the Olympics opening ceremony then Team GB can do no wrong even if no Golds are achieved.
However, 2012 will indeed be a “Long & Winding Road!.......................
Friday, 9 December 2011
Europe isolates itself from the UK as reality sets in again
I've been listening to the news on Bloomberg and Sky News again which is never a good thing to do on a Friday. The pro-Euro brigade and indeed our own media are suggesting that DaveCam has isolated UK from Europe. Well, I've got good news for the millions of kids who will grow up on the great isle. Yesterday I took a ferry from Dover to Calais in quite rough seas and I can confirm that the distance between UK and Europe is getting greater. There is indeed coastal erosion.
At last DaveCam has shown some leadership and listened to those with greater understanding of the great Euro experiment. Apologies to those who hate the word GREAT as indeed I do too. Our cousins across the Atlantic Ocean seem to be more concerned about US banking losses in our 'City' right now. What a bunch of late developers! Weren't they the people who woke up to the progress of fascism in the last war around 2 years after us? Weren't they the nation who bankrolled the IRA? or am I missing something here?
For record I don't want a SPECIAL RELATIONSHIP with America or anyone in Europe either so the isolation that these morons speak of is a good thing. The club that Angela & Sarko have created has the look of a few other clubs that I don't really want to join too. I take the view that Europe is NOW isolated from us NOT the other way round. If for instance the french kids don't like this new isolated island they can give up their cushy jobs and get back on the Euro Star. Personally I cannot any longer tolerate this nonsense about OUR failure to support the Euro experiment (for record we've been net contributors). It's a toxic experiment that never got out of the laboratory. Fortunately DaveCam's Eton chemistry lessons were attended whereas I suspect Clegg went walk about for the Chem lessons at Westminster. Who knows? & frankly who cares?
The EURO is a d e a d z o n e.
I know.....I live in France. Lovely countryside just a great shame about all the paperwork and extraordinary prejudice shown to anyone foreign.,
It's GREAT to be part of the COMMONWEALTH OF NATIONS again. Now we can all get back to trading with anyone who wants to do honest business over the course of a proper working week.
StopPress***
For record not much happened in the exchange today. European bond yields went up & down and now everyone is trying to work out who will buy their next tranche of bonds. Don't bother emailing me the details Angela or Sarko as I regret I don't invest in laborious franchises.
Message to Bloomberg...get real! & stop being so typically late American.
At last DaveCam has shown some leadership and listened to those with greater understanding of the great Euro experiment. Apologies to those who hate the word GREAT as indeed I do too. Our cousins across the Atlantic Ocean seem to be more concerned about US banking losses in our 'City' right now. What a bunch of late developers! Weren't they the people who woke up to the progress of fascism in the last war around 2 years after us? Weren't they the nation who bankrolled the IRA? or am I missing something here?
For record I don't want a SPECIAL RELATIONSHIP with America or anyone in Europe either so the isolation that these morons speak of is a good thing. The club that Angela & Sarko have created has the look of a few other clubs that I don't really want to join too. I take the view that Europe is NOW isolated from us NOT the other way round. If for instance the french kids don't like this new isolated island they can give up their cushy jobs and get back on the Euro Star. Personally I cannot any longer tolerate this nonsense about OUR failure to support the Euro experiment (for record we've been net contributors). It's a toxic experiment that never got out of the laboratory. Fortunately DaveCam's Eton chemistry lessons were attended whereas I suspect Clegg went walk about for the Chem lessons at Westminster. Who knows? & frankly who cares?
The EURO is a d e a d z o n e.
I know.....I live in France. Lovely countryside just a great shame about all the paperwork and extraordinary prejudice shown to anyone foreign.,
It's GREAT to be part of the COMMONWEALTH OF NATIONS again. Now we can all get back to trading with anyone who wants to do honest business over the course of a proper working week.
StopPress***
For record not much happened in the exchange today. European bond yields went up & down and now everyone is trying to work out who will buy their next tranche of bonds. Don't bother emailing me the details Angela or Sarko as I regret I don't invest in laborious franchises.
Message to Bloomberg...get real! & stop being so typically late American.
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