Now this one is a bit of a heavy one I must warn you.
If you sense there’s more to understand around what’s happening in the world right now , and you can handle looking at something a bit scary for a bit, then watch out for what fear does to you. Don’t let fear urge you to sell up, to liquidate, or to change anything. Consider things for what they are…that’s it.
The one big thing I’ve been trying to understand this year around building wealth, has been around the new uncertainties we that we aren’t being rewarded for yet as investors.
By default, my assumption is that when there’s risk, there’s opportunity, and when there’s opportunity, there’s reward.
What if the reward comes first though? Are we then just left with risk? What if the presence of super-normal returns isn’t just a result of excess and irrational market exuberance – what if it’s an advance payment for what’s about to come? With high risk comes high returns, but always in this order?
Just like when we were kids, we’re often scared of things that aren’t even real. Other times, we’re not scared enough of the things that ARE real.
I’m not suggesting an all out share market crash is coming, but I’m concerned that we’re not preparing enough for how things may unfold (not just as investors, but as parents, employees, businesses and communities and so on).
Whether you’re still learning, like I am, or you’re incredibly sophisticated, we are in a new world.
We have to be careful not to allow hubris, or fear, to inform our investing behaviour. While I personally believe investing through this time could actually be quite rewarding, I’m conscious I have to think differently too.
Value vs growth, active or passive, gold or bitcoin. Listen to an industry incentivised to keep you investing, in all the ‘right’ things, or question everything? Follow the ESG-flavoured virtue signals, or trust your gut? Everything’s things right for a season, just like the clock’s right twice a day, but every now and then –daylight savings throws us all off.
A change in one realm can quickly invert the result you’d get in another realm – it’s far too complex out there now to be deterministic in our thinking.
Senior lecturer at Waikato university Dr Reuben Steff joins me from the Czech republic to help me understand the changing geo- political landscape.
Reuben’s researched Artificial Intelligence, nuclear and ballistic missile deterrence theory, New Zealand and US foreign policy, and the list goes on. He’s the author of four books, and today, we’re covering the Russian invasion of Ukraine, the European energy crisis, Taiwan and China, then the US and New Zealand.
Recommended research:
• Skim headlines from The Guardian and CNN.com, Fox and Breitbart (occasionally) to see the right/conservative/populist/slightly contrarian views.
• Antiwar.com is good as a daily media aggregator. They have an obvious editorial slant but you can get a good picture of stuff going on around the world just by reading the headlines every day. • https://www.realcleardefense.com/ • https://www.understandingwar.org/ – excellent daily updates about Ukraine.
• Consider subscribing to Geopolitical Futures (https://geopoliticalfutures.com/welcome/) which sends short daily updates of major developments of the day – probably the best news source for info on geopolitics. George Friedman does a free weekly column which is always very direct and lucid. His latest: https://geopoliticalfutures.com/russi…
• Consider also Peter Zeihan’s output and his email newsletter is good.
• https://www.reddit.com/r/geopolitics/. Sometimes the best analysis is not the articles themselves but the discussion in the threads about the articles,
• A number of the best podcasts around this topic: The Realignment, Cognitive Dissidents, Hidden Forces, Breaking Points with Krystal and Saagar, Fareed Zakaria GPS, RANE Podcast, The John Batchelor Show, The Red Line, War on the Rocks, The World Next Week, A View from Afar.
• Phttps://www.project-syndicate.org/ has decent op-ed type stuff by big names and big thinkers.
