Welcome to the New Fund Order. An Orwellian journey into the Darkside, the Frontier and the Fringe of Finance.
Normal service resumed, as we catch up with Hong Kong veteran and Welshman Richard Harris of Port Shelter as to expand our appreciation for noise and narratives in markets. We cover;
Words: Truth, Bias, Noise and Narrative.. How do words and media change how investors think and react?
Asia: Philosophically and practically.. in the breakdown are there key differences in the way wealth is managed in Hong Kong and Asia to Europe? How does that impact the selection of fund managers?
Fiscal policy: G7, taxation. What trickle down effects do you see it having on markets and in turn funds? Inflation: Global inflation and regional variance. Are we facing into a new cycle of higher inflation and will central banks freeze from raising rates leading to a collapse in real yields? Are Bond markets a bust? How should fund allocators hedge their portfolios from inflation scenarios?
Trade: Global free trade, is it in danger? How important is the Trans Pacific trade agreement and bringing U.K. into that trading scrum? How does US and China best play U.K. and Europe?
Macro: Capital flows into and out of China, is China ascending US as the global leader economically, and from there in Financial markets? Is the world now chasing the tail of the Dragon?
Equities: Has the question in global equities become too narrow and binary on the fortunes of Big US Tech, should fund allocators be going wide and looking to the wings to run the ball...
Excerpt;
"How noise affects the decisions we make
Truth, bias, noise and narrative. by Richard Harris
It is now a truth universally accepted that opinions and decisions are made both intuitively fast and analytically slow. Daniel Kahneman’s book “Thinking Fast and Slow” revolutionised how we think about how we think. For those looking to wade through Kahneman’s small-print, 500-page life’s work, I recommend starting with Michael Lewis’ book “The Undoing Project”, which explains the relationship between “Danny” and his friend and collaborator Amos Tversky. Amos sadly died before he could receive the Nobel Prize that he would have won with Kahneman in 2002.
..The good news is that most of our decisions are close enough right. Armed with Kahneman’s ideas, we can better optimise them if we are aware of those narratives which are so noisy that they are (from Macbeth), “a tale told by an idiot, full of sound and fury, signifying nothing.”
Richard Harris is Chief Executive of Port Shelter Investment and is a veteran investment manager, banker, writer and broadcaster and financial expert witness.
Credits;
George Orwell 'Nineteen-Eighty Four', Public Domain 1.0.
Source: BBC.co.uk. A small choir of unidentified Welsh miners perform two pieces for your entertainment. Their first song is a Welsh hymn entitled 'Ebenezer' ('Ton-y-Botell'). Taken from a 1936 programme called 'Street Show', this recording was made in the BBC Concert Hall at Broadcasting House in London. Originally broadcast 14 December 1936. Public domain 1.0. Additional Sound effects by Soundbible.com. Creative Commons Attribution 3.0 and Public Domain 1.0. All additional Music used by Silvermansound.com Attr
Active is: Allianz Global Investors.
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