How Windy Is It . . . ? Tuesday, 26th July 2016 – No.189
How Windy Was it last week?
Since the Global Financial Crisis dissipated in March 2009 (and morphed into Financial and Sovereign crises along the way), the compliance sector saw a profound rise in job demand. 2016 looks to have ushered a new set of in demand careers: news reporters, political analysts and lawyers. Such is the nature of world events this year, which looks to have reinforced the feelings of pessimism amongst investors.
However, it is not all bad. Sterling investors are buoyed with owning overseas equities and benefiting from the currency translation, with diversified portfolios helping to provide some level of consistency. The problem this year has been a backdrop of terrorist atrocities and the rise of political isolationism, which does not engender a positive view for growth and prosperity.
The markets are more reliant than ever on stimulus from central banks across the globe and this looks to be the continuing theme for many years to come. It makes for an uncomfortable backdrop for long-term investors, which ironically tends to be the times when long-term investing makes most sense and gives the greatest rewards.
There has always been uncertainty in markets. Perception seems to be that once one situation has been resolved, another is just around the corner: The dust may not have completely settled on the first tremor of Brexit, when the US election starts to dominant the headlines and analysis, and the electorate feeling disenfranchised, impacting the traditional political elite. Previously sound assumptions are being tested, which makes the short-term an interesting place to live.
There is plenty to be concerned about in the short-term, however we feel that the long-term opportunities that are being presented are those that do not occur often. A steady hand and a clear head will allow investors to benefit from long-term investments.
The summer period has been typically quiet in the past, however this year we think it will be one of the busiest times we have ever seen.