topped up a bit late friday26 Sep 2021 07:26
I hate this up to 15% volatility but no stock goes strait up day on day, week on week, month on month -even in the most stable of markets.
We are in a slightly choppy jittery market due to the house of cards of high asset values being held up by historically low interest rates. For my money I think these very low interest rates will be around for a couple of decades but the market expectation they will "get back to normal" much quicker than that and thus a constant jittery market. Normal is a 4% central bank rate.
I had hoped that in the FTSE 250 we might move short term with less volatility (and in proportion with the market both up and down) -punctuated by GROW specific results upwards on occasion. Sort of an upwards ratchet effect from whatever level parity with the market would indicate.
We can't seem to settle on a steady premium over trailing NAV/share. Holding some stock (about 20%) in post IPO prices (and on the "frothy" NY exchange no less) is clouding the strategy of who we are. I will open an expensive bottle when we exit all post IPO traded ownership and recycle that money earlier in the "start up to unicorn" value chain we say we specialize in. I appreciate that the funds that own a private company going public may agree to a staggered exist with a 6 month embargo on fully selling out post IPO on the exchange.
My prediction is that even printing money will take much longer to wind down than the market predicts. I don't think any government is paying the coupon on bonds in the G7 so in effect is magic money. So long as western G7 countries can get away with it and so long as they all do it together (and thus can get away with it) there is little political incentive to stop. One excuse or anouther will be rolled out to keep at least some printing going.
There is a touch of a Marxist economist in me in that I believe capital markets need frontiers to expand into to maintain a high rate of return on investment (and thus sooner or later the interest rate in one form or anouther). The expansion can be internal, such as a pivot to tech, even while GDP in general is stagnating and interest rates are thus correspondingly low. There is my long term GROW strategy in a nutshell.
Classically the expansion is to new markets and territories (raising the overall rate of return on capital) but I think this is "mature" or even blocked due to poor enabling governance on the small number of remaining global market countries. At a macro level it is a mistake to push China out of the global market in order to favor g7 capital. Chinese expansion up to developed country GDP/capita is the big one and it will now go increasingly to siloed Chinese capital. We are shooting ourselves in the foot. India an Africa will likely stagnate due to poor governance and corruption -some of that caused by the G7 when pursuing narrow enterprise specific lobbying and meddling. It is all a bit of a mess.
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