Or at least not if you are an investment manager watching the markets head south. Monday 8th August 2011 was definitely not our favourite day.
Having said that, the panic driven demise of global stock markets was not unexpected. Nor do we think we won't experience this again. Maybe our experiences of the past three years have hardened us to such market movements and what would once have seemed catastrophic, now seems par for the course. Something of an indictment of modern economics.
We could analyse each sector and forecast what we think will happen over the next few days and weeks, but that is a mug's game. We are not doomsayers by any means, we believe in a strong recovery to reward investors for sticking with it, we think that common sense should prevail sooner rather than later and the market will start to reward, not punish, well run companies. That is the shame of investing at the moment - politics is driving sentiment not considered market analysis.
August has only just begun yet has already suffered the ignominy of Eurozone crisis talks and US political infighting culminating as one. Much has been made of the Eurozone situation, but how responsible has the US been in all of this.
We completely moved out of US funds a couple of months ago - that wasnt just luck it was a decision based upon facts. The writing was on the wall for economic growth which has devalued the merits of much of the investment universe in the USA. I addition we also harbour concerns about the political situation given the ongoing impasse between the White House and the Republicans in Congress. The last election campaign was drawn out enough to virtually suffocate the economy for about a year prior to voting day. The 2012 election promises an even worse effect. The struggle to beat the deadline for agreeing a plan to raise the US debt ceiling does not bode well. If neither side can compromise readily on a matter which could have crippled world economies, we seem destined for months of political point scoring - we can only hope that someone swallows some pride and actually puts the needs of their country and the wider world above their own personal or political fortunes. If they don't, they may not have fortunes of any sort. Suffice to say, the US are taking the flak at the moment, but anyone who has heard the UK's Prime Minister's Questions over the past decade would surely recognise this short sighted sniping in our own politics as much as across the pond.
We are firm believers in economic recovery and whilst the short term pain is tough to face, if we can finally sort out the Eurozone debacle, rather than just postpone it again and if the US really takes hold of their economy to accept yet more debt for long term stimulus we anticipate sustainable Western economies and investment markets.
We are not so far away from this progress despite today's events and the headlines to come. Maybe next Monday will bring some better news.
Tags: Eurozone, USA, White House, Republicans, Prime Minister