OK so if at first you dont succeed……its been over a year since i wrote something but recent events in my life have inspired me to come back. Basically i had 2 kids and gave up drinking…..writing is now my escapism! Hangovers are much better….

So i read back the posts below and realized…predictions are fking hard. I basically predicted a financial crisis in feb 2016, at the market lows (spoos have rallied 40% since then…YES, FOUR ZERO), which is something i thought only dumb money did. Turns out when all hell is breaking loose and the market is consistently selling off its very hard to be a contrarian and step in and buy. The biggest lesson though, is that i had no idea i acted like that – in my mind i wanted to buy the market at the lows but it was my risk averse, follow the crowd employers who didnt let me. Amazing how you remember the past differently to how it actually went down. Another reason for me to write this blog…….

So whats my view now? Bullish risk assets. I know what youre thinking: no surprise there given the rally we’ve had…but i think saying there is a long way to go i think is somewhat contrarian (how many WSJ articles have there been about how stocks are overvalued). My reason for this is I firmly believe something is going on in the markets that no one understands. And going on = driving prices higher. How else can you explain that Apple stock, one of the largest, most followed and relatively easy to understand biz models is up more than 50% in 10 months, without a material change in earnings forecasts.  Just think about that. Maybe the market was too bearish by not giving the company a high enough growth multiple, or is it because there is so much money flooding into the market now without any concern for fundamentals that have to buy the stock because its such a big part of the index? Ie a vicious circle – the more the stock goes up, the more people have to buy it. Apple is in value, growth, large cap, tech and dozens more ETFs that have to keep buying as they get inflows, which are growing given the poor performance of active managers. So ignoring how ridiculous a stock can be both growth and value, what breaks this vicious cycle? Really am not sure. The Fed still owns $4trn of assets- money that was effectively given to risk assets – they are talking about selling $10bn a month of assets- so in 3 yrs north of $3.5trn – in other words who cares? That unwind is still not enough to absorb to materially decrease the demAND FOR RISK ASSETS, THEY WAY IT INCREASED IT WHEN QE WAS first done. LEt me ask you this, if the FED had only bought $10bn assets a month would it have had the same impact that it undoubtedly has had on risk assets. I assert no.

“The Fed launched QE1 on November 26, 2008. By March 2009, the Fed’s portfolio of securities had reached a record $1.75 trillion. Nevertheless, the central bank continued to expand QE1 to fight the worsening recession. It announced it would buy $750 billion more in mortgage-backed securities, $100 billion in Fannie and Freddie debt, and $300 billion of longer-term Treasuries over the next six months”

Wow – i jut looked the above up – had no idea it was that quick! So logically, the inverse should hold? I know between the passive money and QE i am not saying anything thats not obvious / basic (most of my points are both)- i guess what i am saying is i think the market is underestimating its impact (u/estimating passive and overestimating impact on fed taper) just like it underestimated the initial QE. And closer to home the ECB is still buying a gigantic amount of bonds – far higher as a % of the market than the fed or BoJ ever did. HOnestly think estocks could be up 20-30% in the next 12 months (will probably regret that but thats my view) – not just because of the ECB but the passive money i.e. ETFs are growing in Europe – have a long way to catch up with the US – another reason why large cap stocks in europe arent up 50%

And on to Man Utd – i was right about LvG – his turgid football was just not good enough. And JM – is he much better? Well he has better players but i still have NO IDEA what type of football we play. Whats our system? We dont play intricate passes through the middle, we dont play with natural wingers, we dont counter attack…ugh. I went to the recent Chelsa game and we offered less than both our visits under LvG.