Words of Wisdom (7th May 2020)

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May 072020
 

Warren Buffett’s Advice (Berkshire Hathaway AGM)

Every year, thousands of Berkshire hathaway shareholders flock to listen to the Warren Buffett at the AGM. This year, due to the Covid-19 restrictions, it was a ‘virtual event’.

Here are a couple of clips, that I think contain good advice for any DIY-Investor…

Being a “farmer”…

Particularly relevent IMO is the section, where Buffett states…

So if you had that farm, and your neighbor offered you $2,000 an acre on Monday, $1,200 an acre the next day, and maybe then $800 an acre the day after, that shouldn’t change your evaluation of the farm’s potential.

“Are you going to let this guy drive you into thinking: ‘I better sell because this number keeps coming in lower all the time?’” he said.

Bringing the right psychological approach to owning common stocks is important: Betting on that farm may be better than listening to the neighboring farmer

On handling fear…

Do Your Own Research (DYOR)!

Mick (7th May 2020)

Ray Dalio on Debt (23rd April 2020)

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Apr 242020
 

Ray Dalio Explains Debt in Simple Terms

This interview, first published in 2012, is very relevant to the current (2020) explosion in money printing. Ray Dalio, founder of Bridgewater Associates, explains…

Simplifying the explanation of something that most people find complicated is an artform… one at which Ray Dalio gets an “A Star” IMHO.

As ever, please do your own research (DYOR) and make up your own minds accordingly.

If you have any comments or observations, regarding the above, then please use the contact us form Here.

Mick (24th April 2020)

US $1.8 trillion Support Package (25th March 2020)

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Mar 252020
 

US Support Package Announced

American President Donald Trump, and the Senate, have sanctioned a huge relief package for the American economy… worth more than $1.8 trillion (£1.5tn). This includes money to ‘bail out’ industries that have been affected by the coronavirus crisis.

It was described, by Republican Senate Majority leader (Mitch McConnell), as a “wartime level of investment” in the American economy.

On Tuesday, markets in the US had surged, jumping by 11.4% – the largest one-day gain since the Great Depression, in anticipation of a support package deal. This morning, shares have also risen in Europe on the news.

A full report can be found on the BBC Here!

As ever, please do your own research (DYOR) and make up your own minds accordingly.

If you have any comments or observations, regarding the above, then please use the contact us form Here.

Mick (25th March 2020)

 Posted by at 1:39 pm

Coordinated Central Bank Intervention! (15th March 2020)

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Mar 152020
 

Coordinated Intervention in Markets

This evening, Sunday 15th March 2020, five central banks across the World took coordinated action… see the BBC report below!

I’ll be setting up an interim webinar for Inner Circle members to discuss the ongoing situation, so watch out for an e-mail with registration details tomorrow morning.

Mick (Sunday 15th March 2020, 22:45 GMT)

Interest Rate : Emergency Cut (11th March 2020)

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Mar 112020
 

Bank of England Cuts Interest Rate by 0.5%

At 7am this morning, in a response to the economic impacts of the Coronavirus, the Bank of England Monetary Policy Committee (MPC) has cut interest the BoE interest rate by 0.5% (from 0.75 to 0.25%) matching the record low level that was set in August 2016 (and lasted until November 2017). Mark Carney, the outgoing BoE Governor sets out the MPC’s reasons in the BBC presentation (below)…

Mick’s Thoughts

Even before the Coronavirus came along, there were stress signs beginning to emerge in the economy and the stock market had been on a record bull run. Covid-19 has provided the ‘supply shock’ that has pricked the economic bubble – that has been continually pumped up by the endless printing of new money. IMHO, there could be a lot of shrinking to do. Using this interest rate ‘weapon’ now and no doubt, with the spending spree shortly to be announced in the budget… inflation will likely become an increasing threat. If the virus does have anything more than a short-term affect on output, contributing to loss of confidence and ultimately a (possible global) recession and an increase in unemployment, could we end up with a bad dose of ‘Stagflation’?

As ever, please do your own research (DYOR) and make up your own minds accordingly.

If you have any comments or observations, regarding the above, then please use the contact us form Here.

Mick (11th March 2020)