One of the staples of the financial pages of our daily newspapers in summer is asking top businessmen and fund managers what they will be reading on the beach that year. They invariably say ‘the Bill Gates biography’ or The Essays of Warren Buffett.
When I see this, I always think two things: “Glad I’m not on holiday with you, mate’ and “you almost certainly said that just for effect”.
For me, police procedurals and offbeat sports biographies top the list. While we are sadly not on the beach this year, the principle is the same; we are suddenly finding that we have a lot of time on our hands and so we’re dusting off those paperbacks.
I’ve remained true to my literary genres having just read a classic murder mystery set in North Devon followed by a hilarious account of how a high-flying businessman gave up his job for a year in an attempt to become a professional darts player.
Ever the professional myself, I do like a bit of social and political history as I think this genre better frames long-term investment decisions. One of the best examples is Prisoners of Geography by the journalist and broadcaster Tim Marshall, written back in 2015 but still relevant (I sense an updated edition will be in the works).
It puts the ‘geo’ into geopolitics and explains why China and India have never been in conflict, how drawing straight lines on a map in the Middle East and Africa have been the reason for ceaseless conflicts, and how climate limits Russia’s attempts to be a global superpower. It then looks forward to how technology, old and new, is bending the previously iron rules of geography.
My leisure reading is one thing but I spend most of my days wading through seemingly endless deathly prose, web casts and Zooms from investment banks and asset management companies considering whether the economic and market recovery is going to V, L, U, or W-shaped.
I’m not going to burden you with all the detail but our view is that the big market fall was overdone, but then maybe so too has been the speed of the market recovery given the extent of the long-term damage to global growth and company profits.
As to the shape of the recovery in global growth, and consequently that of equity markets, it’s going to be a long haul and, maybe, the Nike ‘swoosh’ is the best analogy. Other brands of athletic shoe are of course available, but I’m struggling to fit three stripes, or indeed a puma, into my narrative.
For those who wish to read about our investment views in detail, both strategically and with specific relevance to the changes we have been making to client portfolios for after the pandemic, we have been producing a series of market update notes on our website to keep you fully informed. Head to https://www.hfmcwealth.com/insights-and-press/ to read these notes.