Magic Markets #229: Macro World Tour

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The Finance Ghost: Welcome to episode 229 of Magic Markets. It’s great to have you here. If you missed out on last week’s show, then go and check it out. We had Connie Bloem from Mesh and Craig Antonie from AnBro on the show talking about the Titans portfolio, which certainly made for a great discussion.

Week before that, we did Saudi Aramco and Ferrari. Moe, I was pleased to see that Ferrari did get victory once more at Le Mans. Something that we actually talked about on the show was how important Le Mans is to that business versus Formula one. And I’ve got to tell you, you had the Canadian Grand Prix in your backyard actually this weekend and I suspect you watched it – that alongside Le Mans was a reminder that Ferrari is very good at sports car racing, not so good right now at the top formula racing. But be that as it may, today we’ll talk a little bit about macro and I know you’ve got a bit of a world tour planned for us, Mo, which I’m certainly excited to get your insights on because this is what you do of course is keep an eye on the macro stuff going on around the world. I’m way more of a company focused guy and that’s why this works so well together.

 

Mohammed Nalla: Indeed, Ghost. I think a lot of our listeners have told us through social media or emails that they’ve sent us that they really quite enjoy some of the shows we do where we discuss the macro and then try and bring that back into actionable investment insights that people can use in their day-to-day life, in their day-to-day investing. So that’s part of the rationale behind this world tour that we want to do this week. I’m not going to waste any time lamenting Ferrari’s dismal performance at F1. At least we had good weather in Montreal. Normally Montreal gives us some pretty scrappy weather. So it was a decent race. But again, I guess decent if you are a supporter of any team other than Ferrari. Let’s leave that there.

Ghost, let’s jump into what’s happening globally. Because the same way Formula One travels around the world, I’m thinking a lot of our listeners’ portfolios also travel around the world. And if they don’t, maybe they should. It’s certainly central to our entire thesis around Magic Markets Premium is we look at global stocks. So even when we are looking at this from a bottoms-up basis on specific companies, we look at US Stocks, we look at European stocks, part of that rationale is just because it’s a very big world out there. But remember, all of those stocks, all of those companies exist within the overall macroeconomic construct. And that’s why it’s so important to sometimes step back, have a look at what’s happening with some of those big data prints and see if there are any inconsistencies between what the companies are telling us versus what we’re seeing in the headline macroeconomic prints.

Now, Ghost, with all of the action going on around the US trade tariffs, we’ve discussed that on the show. We’ve discussed oil pretty recently. Now we’ve got these terrible conflicts in the Middle East that have certainly escalated. And again, the market’s all over the show. When we went into the weekend, I remember looking at this saying, war’s breaking out, do you want to actually go short this? And then I went and I had a look at what happens when war breaks out. And invariably the market tends to bounce back pretty sharply thereafter. So I thankfully didn’t enter a short. And that’s because on Monday – you were on a public holiday – but up here we had US markets up close to 1.5% to 2% on the day, so that short would have been very painful. And again, testament to the fact that sometimes the market shrugs off some of the headline news flow, then maybe it digests it and we’ve seen some of those gains being given back over the last couple of trading sessions. I digress.

What I actually want to discuss is what’s happening with the US economy. Let’s start off there and then we’ll move across the pond to Europe and to Asia.

And if we look at the US as it stands today, a lot of people just don’t know because there are some people that were at least a month or two ago – way smarter than me – saying the US is definitely going into a recession if they stick to this tariff timeline. And again, I think that was the big proviso, because what we’ve seen is we’ve seen “Taco Trump” – that’s what he’s being called. Trump always capitulates or something like that. Taco Trump…

 

The Finance Ghost: …always chickens out. I think it’s always Trump always chickens out. That’s the taco trade.

 

Mohammed Nalla: There we go. Taco, chicken, right. And what’s happened is if you look at a chart on what the average tariff is – now, this is obviously blended across all industries, some have tariffs, some don’t have tariffs – that went from levels below at the start of this entire, let’s call it, episode, it rose all the way up to close to around 30%, 35% on a blended rate. Remember, that includes some goods that have north of 100% tariffs, some countries that have north of 100% tariffs. And then the taco trade happened, and we’ve actually seen that rationalise all the way back down.

So again, typical ‘Art of the Deal’ negotiation tactics, it started off below 5%. Where are we today? We’re just below 15%. That’s 10% to the better in terms of the US if you’re just looking at it from a tariff perspective. Now, they don’t operate in a vacuum, countries will respond to this. And so the concerns here may have switched from a recession – some people say we’re already in a recession, the official data is just not telling us. Other people saying, well, it’s not quite a recession, but underlying growth is weakening. And I think for me, the thing that’s probably most accurate here is that the US is at risk of stagflation.

What is stagflation? For those not familiar with the term, again, in South Africa, you have probably experienced it, but globally, we experienced that in the late 1970s. It’s when the world or economies experience higher stickier inflation, but they can’t actually move monetary policy too much because at the end of the day, the economy is also very sluggish. It’s not growing. And so you’ve got effectively the traditional policy tools, monetary policy being very blunt, being ineffective, and the only thing that solves stagflation is to remove the impact of what’s pushing prices higher. That’s usually an exogenous factor. In the 70s, it was oil prices because of the oil crisis. And at this point in time, it’s really the tariff story. So, the jury is out in terms of do tariffs actually translate into higher inflation in the US. I certainly think they will. We saw inflation trough at around 2.3% and then the most recent print in the US up to 2.4%. Now you’re gonna say that’s 0.1%, it’s still got a 2 in front of it – no big concerns. But remember, these may have longer tails. So I’m concerned about that.

The second point I’m concerned about is if you look at US GDP in Q1, it actually went negative. If you get a soft Q2, that’s going to give you a formal recession. Do we actually get there? Again, I don’t think it matters because that’s just the technical definition of a recession. What we are seeing is overall economic activity in the US is mixed, it is slowing down. We’ve got PMIs, which is a good leading indicator. That’s Purchasing Managers’ Index, it’s a good leading indicator. Those are still expanding. But there are other fracture points that are starting to come through.

For example, at the time of this recording this morning, we actually saw US retail sales numbers come out and those were a lot softer than the market expected. So, the distortion that you’re seeing in US headline economic data right now is that on the announcement of the tariffs, there were a lot of people that bought forward, trying to circumvent the tariffs. You saw these massive distortions come through. Those distortions are now starting to ease back and the world’s going to look at this and say, okay, great, how do we deal with tariffs around 15%? What does that mean for growth? What does that mean for prices? A lot of consumer facing companies, retailers, are looking at pushing those price increases through and again that’s going to start to come through with a bit of a longer tail.

Now, all of this against the backdrop of real rates in the US that have been a little bit stickier. We haven’t seen rates being cut as aggressively as the market was maybe pricing in around a year ago. And the Fed’s been very cautious around this. If you’ve got real rates that are – let’s call it, I wouldn’t call it high, but certainly a little bit stickier – you’ve got inverted yield curve, you’ve got the consumer under pressure with those retail sales coming through. That gives you a fairly difficult backdrop, which certainly raises some question marks around the exceptionalism that we’ve seen in US markets.

I’m going to give you one last point and I’m going to let you jump in here, Ghost. Remember, at the end of the day the US’ entire business model is predicated on the fact that they run these big deficits, but they then enjoy a massive surge of capital that comes into the US. It invests in US stocks, invest in US bonds – and question marks and cracks are starting to show around that. If we actually see that build a little bit of momentum, that US exceptionalism story is going to start looking a lot more tenuous Ghost.

 

The Finance Ghost: Yeah, US exceptionalism, or perhaps the lack thereof, has very much been the theme this year. Is it accurate to say that in many cases these tariffs are actually just an additional tax on American citizens? Because at the end of the day, someone has to pay somewhere, right?

There’s this overarching thing of, okay, we’re going to import less from China. The reason that there’s been so much importing from China is because it’s an efficient way to source stuff and get it to the American people. You can’t just spring up all this alternative manufacturing within American borders overnight or even over three, five years. It’s still not that straightforward. So all that happens is either, as you say, retailers push the prices up now everything is more expensive. The US economy is not doing that well right now – that impacts volumes then. And so the story goes, South Africans are very familiar with that life. Or you have a situation where companies try and absorb tariffs where they have margins to do so, or a portion of the tariffs, but at the end of the day, that means fewer bonuses to their staff, lower dividends to shareholders. Someone’s going to pay somewhere, right? That’s just the reality of this thing.

 

Mohammed Nalla: Or maybe it’s a fact that people pay along the way. So maybe the consumer pays and investors, and, you know, investors reliant on dividends, they pay, companies pay because margins might get compressed. I think it’s a combination of all of that. And I think you’ve asked a very important question, is that at the end of the day, tariffs are effectively a tax on the American people. And again, going to the most recent data points, if you looked at import prices that came through, those were actually sticky. They didn’t budge. So that’s showing you that global suppliers have not cut their prices in order to try and keep their competitiveness and to respond to that US tariff story, they’re saying these are prices and if the US wants to impose the tariffs further downstream, you’ve got to decide what you do with that. If you’re Mr. Retailer X, do you push that onto the consumer? If you’re the consumer, do you keep on buying?

So I think it’s a combination of all of those. And let me maybe just square the circle on this – what does this actually mean from an investment thesis perspective on the US? What I’ve been doing is over the last while, several quarters in fact, I’ve been moving significantly more defensive. You’ve got to actually either stay long the quality equities that have pricing power or you’ve got to actually say I’m going to go defensive. Let’s consider energy plays there. Let’s consider consumer staples utilities. Remember, tariffs don’t impact utilities and utilities are non-discretionary spend. If you actually see that pressure materialise, that’s how you want to be positioned on any US exposure that you do have.

I’m going to use that as a perfect reason to segue away from the US because this has also been something that I’ve done in my portfolio again over the last several quarters. I spoke about Europe and I remember it was probably three going on four quarters ago, but let’s call it three quarters ago. I was speaking to some of the institutional clients and I said Europe on a relative basis, just on a valuation story is significantly cheaper than the US and so I would be looking at geographical exposure there. And I couldn’t really put my finger on what would the catalyst be. I mean no one could have seen the tariff thing coming. Obviously we then had the Trump victory and the tariffs and so forth.

And I must say, my exposure to European equities over the course of the last, let’s call it two quarters specifically, because it was probably a quarter early, have shot the lights out relative to the US. Just go and have a look at a chart year to date to where we are now. Map the EUROSTOXX 50 versus the S&P and you can actually see significant outperformance from the European stocks.

This is twofold, right? It’s not because Europe is doing fantastically. I’ll go into some of the economic macro points around Europe. It’s just based on the fact that US valuations were trading on that US exceptionalism continuing. And I think that’s some of the derating that you’re seeing come through in the US versus a re-rating that you’re seeing come through in Europe.

Now let’s look at Europe because Europe’s actually been this laggard for the longest time. They were very fiscally conservative, led by Germany. Germany had a rule, a hard fiscal rule saying you can’t run these big fiscal deficits. Then we had a pandemic and they had to run the deficits. And from then until now, Germany’s actually eased up a lot on the fiscal side. They’ve been running fiscal deficits. They still run a current account surplus, they still export a lot more than they’re importing. But why is this a game changer in Europe? Germany is the largest economy in Europe and a lot of critique would come from the fact that Germany was just not deploying its capital, its fiscal, let’s call it leeway, appropriately, to start spurring growth in the Eurozone as a whole. Now, what’s important is that Europe seems to be abandoning some of that fiscal orthodoxy that we had. Germany has abandoned its hard fiscal rule and they have been running those deficits. And what that’s actually meant is that we’ve actually started to see some of the underlying economic activity tick up.

That is contributing to some of the positive European sentiment that’s coming through. A couple of key caveats is that productivity in Europe remains dismal. I’m not even going to say weak. I’m going to call it dismal. And if you look at working hours, if you just look at German and French workers, because you would argue, oh, maybe it’s just the French or the Italians, but if you look at German and French workers, they both work fewer hours than their US or their Canadian counterparts. And so that’s telling you that Europe as a whole does have a productivity problem, how do you fix that? Well, maybe you start investing in capital, you start bringing machinery in.

Are we starting to see the early signs of a turnaround, a sustained turnaround in Europe? I think yes, there is a probability of that. The ECB has been cutting rates, but lending activity, that’s been subdued. Consumer confidence still fairly low. And again, remember, last point here, the energy costs, that was a big problem for Europe. Remember, they pivoted very hard to clean energy. Then we had oil prices rising, that hurt them a lot on the inflation front. That has started to abate, but remember, it’s a very fluid market. And with the Middle East tensions happening now, there’s a question mark around, does that actually push inflation up in the Eurozone? Does that curtail some of the monetary easing that will then possibly offset some of the fiscal largesse that is starting to materialise in some key economies?

Wrapping that up again, I’ll do this for you pre-emptively, Ghost. I don’t expect a fast recovery in Europe. Like I say, it’s been a rerating story for me. So you’d still want to be selective there. I’ve gone with some financial services names that have come through but you could also probably look at some export-driven north European equities that come through and again, big emphasis on defence spending, lots of capex. So if you want to play some themes in Europe, that’s probably where I’d be looking at. I wouldn’t really be looking at some of those consumer plays. I think the consumer in Europe remains quite downbeat.

 

The Finance Ghost: So I know you want to still talk about China and I certainly do as well, but I’ve got to have one stat for you here. I went and drew a EUROSTOXX chart as requested and yes indeed, it’s had a decent year. But, guess what your return on the EUROSTOXX 50 has been since March 2000? So that was a time when – March 2000 I would have basically just turned 12, I was reflecting on a world in which I was expected to listen to Spice Girls and Backstreet Boys and there wasn’t much else. It was all very bleak and the markets were very exciting and then suddenly they were very terrible because it was dot com crisis time. So since March 2000, roughly, EUROSTOXX 50 – don’t cheat now I can see you googling. What do you think that thing’s done? Just more or less.

 

Mohammed Nalla: I’m not googling, I’m not cheating. I’m going to guess, right – I’m going to tell you, you’re probably around cash type returns if you’re lucky. So low single digits.

 

The Finance Ghost: Give me the number, I’ll put you out your misery. Nothing! The answer is nothing. The answer is it is back to where it was in March 2000. That is 25 years of nothing. Now  the NASDAQ-100, you know how people always quote the dot com crisis and “oh my goodness, you have to be so careful, it took so long to get back there” – all of which is true. But since then on the Nasdaq, I mean it’s not – nevermind percentage, it’s multiple times. How many times higher…

 

Mohammed Nalla: Unfair comparison. Unfair comparison. Europe doesn’t have the big tech names. Europe’s been a laggard..

 

The Finance Ghost: …well, that’s Europe’s fault, Moe. That’s Europe’s fault. That’s Europe’s fault. Nothing unfair about it. My rands can go to either place…

 

Mohammed Nalla: …solid double digits on US markets. I mean the US markets have been where all the action has been, right? I mean if you look at Europe, you may be getting a couple of telcos, you’re getting big pharma stocks that come through there, but nothing exciting. All the excitement in the US markets.

 

The Finance Ghost: Yeah. So the Nasdaq-100 is trading at roughly almost five times higher than the March 2000 level. So one flat, being Europe, the other one 5x higher. And really what that just shows you is in a post-dotcom crisis world, where did all the tech happen, full stop? It happened in America. That’s the truth of it. Europe became just very reliant on – it was tourism and everything else. And then there was the whole banking issue and then lots and lots of regulation, lots of concern around the environmental stuff, etc, etc. Too much dependence on the automobile industry.

Yeah, it’s just been a difficult story for Europe and it’s going to be hard for them to really – they might have had a decent year so far, but sho, there’s a lot to change there. The DNA of Europe is not progress.

 

Mohammed Nalla: Agreed. And I think, like I say, a lot of it has been a re-rating story. Just saying these stocks were too hard done by, it’s not to say Europe’s definitively turned the corner. I don’t think Europe flicks a switch and all of a sudden they get innovation. I think they are ahead on clean energy tech, for example. We know the US has stepped back from that. But again, they’re going to have to actually double down on just getting that productivity come through. They’re going to have to double down on investment, they’re going to have to double down on innovation. And that takes a long time.

It’s why we look at these big macro cycles because, yes, they’ve lagged for the longest time. If there are some semblances that they’re actually turning a corner right now, maybe they can actually emerge. And even if their ratings just kind of mean revert to a more sane level or levels closer to what the long-term US average is, because the US is running above the mean right, if Europe just moves back to what the average is, that would still give you a pretty decent result.

And in fact, before I move off Europe, we haven’t even discussed the UK. I’m not going to spend any time on that. But the UK, like Europe has been terrible and they’ve had the Brexit and that’s really hurt them. The problem that I’m watching in the UK right now is that we have an election that comes through next year and so you’re not going to necessarily see any big political moves come through from the UK. They’ve got tight labour markets. They’ve got chronic underinvestment. So a lot of what you’re seeing in Europe actually comes through to the UK as well. And so just pay attention there because I know a lot of South African investors, let’s call it five or ten years ago, were really quite bullish on the UK. A lot of them were investing in properties in the UK. Those investments haven’t panned out as fantastically as one would expect. And again, pay attention to what’s been happening on the pound because again that is a key determinant of what your returns are in the UK market.

Ghost, in the interest of time, I still want to discuss China. Let’s discuss China because again I’ve been a long-term China bull. It was a painful trade for a long time. So I was definitely wrong on China for the last, let’s call it two years. And then China started to look interesting again last year. I obviously didn’t have a very large position. I still maintained some of my key positions in China. Those were painful, I was sitting deep in the red. But that’s turned the corner now and now those positions are back in the green.

China’s interesting for me because they’ve got the structural slowdown that’s been happening in China. But there’s also these strategic shifts and China moves in a slow but very deliberate manner. And historically it was very much around property-led growth, and that’s now changed because the narrative in China is high tech manufacturing, self-sufficiency, getting local consumption to pick up some of the slack from this global pullback. And this tells us that China’s trying to pivot. Now, whether they’re successful or not remains to be seen. You just have to look back around a year to two years ago and we had the Evergrande stories. We’ve had a lot of the large real estate and construction companies hitting the wall, government needing to come through with support.

But what China’s trying to do is they’re trying to reorientate their economy. Now if we look at some of the key headline metrics, growth in China is going to move from a 5 handle GDP to a 4 handle GDP. Remember, China is the world’s second largest economy. In fact, on a PPP basis it is significantly larger than the US. So again, maybe some technicality there, but China is massive and they’ve got 1.2 billion people, slightly behind India at this point in time. But that is why China is strategically very important for the globe as a whole.

With this emphasis that’s come through in terms of the export of EVs for example, just the last couple of months will show you how those numbers have gone off the charts. They’re leading in solar tech. We know they have significant headway in terms of refining rare earth minerals. And that’s why the US is now strategically trying to push back against China.

But the fact is that these geopolitical tensions have maybe pushed back on China, but they haven’t derailed Chinese trade. If you look at what’s happening there, exports in China surged on that front-loading that we discussed to try and get around the tariffs, but they’re now back to levels that we had before the trade wars. And that is because the world is still very intrinsically linked to China. A lot of stuff is manufactured in China. I don’t think we get away from that quickly. Yes, the US is going to try and do that, but it’s the same story on Chinese imports. Remember, Chinese imports are kind of directly linked to what’s happening in their economy and the export side. We saw that surge, we saw it pull back to levels that we had before the trade wars. And again, looking like it’s steady state there. You’re not seeing massive pressure come through.

The interesting thing here is the surge that you saw in the auto sector or the EVs. China has made significant headway there. That’s where it’s really hurting Europe. It’s pressuring your traditional automotive manufacturers. VW, Mercedes, BMW, you think of it – China has been pressuring those markets and again expect to see that.

And then the last point I just want to touch on is China’s actually been rebuilding its forex reserves. You know, they used some of that during the COVID pandemic. But they’ve been one of the largest buyers of gold. You know, we discussed gold on the show. We did a great show with Mesh. I’m bullish on gold. China’s been one of the largest buyers of gold bullion as they diversify their forex reserves as well. And those are currently sitting at around $3.3 trillion. So they have a lot of firepower and they’re going to use that firepower as they try and reorientate their economy.

I am bullish on China over the long term. I think they’re transitioning. I think it’s going to be a painful journey. You’re going to take three steps forward, two steps back. But if you are actually investing for the longer term, I think you’ve got to seriously look at China. And again, decide how you want to do that – you can choose an ETF, you can choose specific names. But I’ve been increasing my exposure to China certainly over the course of the last couple of months. And that’s a position that I’m fairly comfortable with.

So again, that’s how I’m looking at this on my world tour. Before we wrap up, we’ve got to also discuss Japan, right? I’m so excited about this world tour, I forgot to mention Japan.

Japan is the quiet bull case. You know, if you’re looking at Japan, Japan transitioned from years and decades of deflation. They’ve now moved into inflation. So some very difficult decisions coming through there – they’ve been hiking policy rates, trying to normalise that policy, and that’s a major global pivot. And why is Japan important? Japanese investors are large investors in the US, they invest in US treasuries, US equities. And if they start reshoring some of that money, that’s going to come through with some pressure on the US – but if that money comes back into Japan, that’s going to be bullish for Japan. But at the same time, we’re actually seeing that the equity market’s doing pretty well. Global investors are returning to Japan. Warren Buffett’s actually very bullish on Japan as well. Their exports have been stable, their imports have been down.

So in aggregate, Japan’s giving you world class manufacturing. They are a reshoring beneficiary. They’re friendly to the US so they don’t really get the pushback that you get against China. They’re fairly stable politically. And then the yen is cheap by historical standards. If you are actually investing in Japan, you could see the return on the underlying investment as well as some currency appreciation if that materialises over time. I think Japan is chronically under owned because you went through these decades of just deflation, sluggish growth. But that’s now changing. I think they’re improving structurally. And so I’m as excited about Japan as I am about China. But the difference is that Japan’s probably a lower risk play than China, just given some of the geopolitical situations that we have going on right now.

 

The Finance Ghost: Moe, thanks. World tour indeed. And of course I have to then finish us off with this millennium comparison that for some reason I decided was a good idea on this show on the fly – and it has actually been quite fun to go and draw these charts while you wax lyrical about the macro stuff. So let’s do China – Hang Seng Index as good as any, there are a few different things you could look at, but let’s do the Hang Seng. Since 2000, I won’t ask you to guess in the interest of time, I’ll just give you some of these numbers – so since that March 2000 starting point, the Hang Seng up about 40% in total. So you’ve seen some nice growth in China, but absolutely dwarfed by India. And I think on this you’re getting the power of the service economy versus the manufacturing economy. In some respects you’re getting the power of what’s happening in tech, a lot of which has landed in India. So in India, it’s the Nifty 50, and that index is up – I don’t want to get this wrong, this looks like probably 15 times since March 2000, so that obliterates even the NASDAQ, actually. If you could choose one back there, you’d go and get the Nifty 50. Although obviously currency will be dependent here.

 

Mohammed Nalla: Yeah, I want to jump in, right. There’s a very important point and maybe I’ve omitted India, I should have included India, but we just don’t have that much time.

The story of India is remarkable because you’re getting the emerging markets play, you’re getting the massive population play, you’re getting a strong financial services play, you’re getting the tech play that comes through. But there’s one important point that’s been missing from China that you actually got on the Indian markets, and that’s India’s a democracy. They arguably come with a lot less of the geopolitical risk. And then India’s also been looking at liberalising its capital markets. I mean, they’ve got a long way to go.

If you look at Hang Seng, that’s just Hong Kong. You’ve got to look at Shanghai Composite. So again, depending which index you look at, but I think those are some of the key differentiators is that China still has fairly firm capital controls. It’s not that easy to invest in China. And that for me moves the needle significantly. It’s partially why India has also shot the lights out.

For me, the worry around India right now is just the fact that some of those valuations are looking as frothy as the US valuations. And that’s probably one of the reasons why I didn’t actually jump into India right now is that I’m avoiding it just on a valuation concern Ghost.

 

The Finance Ghost: Yeah. If you look at Shanghai Composite Index, then you kind of get a relatively similar story. Still well up versus the turn of the millennium, roughly double, but still nothing close to India.

And then final point for this podcast, we then have to do the index in Japan, right, which is of course the Nikkei 225. And that is a rather incredible maximum chart because it is only recently gone above the levels we saw in 1989, 1990, before their economic – yeah, there we go, before the Japanese economic crisis really happens. So that was two years after I was born.

So if my parents had lovingly bought me a Nikkei 225 ETF when I was two years old, which they definitely didn’t do or even think about doing, but had they done that, I would have made exactly nothing over that time period. And that’s before even adjusting for currency. So that’s just in yen, it would have done nothing. But what is interesting is that versus the 2000 lows, you have at least seen actually a halfway decent return – if I look, it’s roughly doubled. But, yeah, nothing holds a candle to India hey, obviously that’s just picking 2000 as a “silly” starting point, but it does also tell a story. India has been the pick of the emerging markets, really. And now it’s all about what happens for the next ten years.

 

Mohammed Nalla: Indeed. Ghost. I think that’s where we’ve got to leave it this week. I think those data points that you’ve indicated to us are exactly why it’s so important – that from 2000 to now, we’ve had several structural and regime shifts, even in the global kind of construct. And so you’ve got to keep your finger on the pulse. You’ve got to see – in Canada, there’s a saying, they say you’ve got to actually skate to where the puck is going to be. That’s an ice hockey term. And that’s really what you’ve got to do in investing as well, is don’t go to where the puck is right now, go to where the puck is going to be. Skate to where the puck’s going to be.

That’s what we’re trying to do with some of this macro context that we’re actually providing. Unfortunately, with macro, there’s always so much to digest. So we hope you’ve enjoyed the show. Let us know about what you thought on social media. It’s @MagicMarketsPod, @FinanceGhost and @MohammedNalla, all on X or go and find us on LinkedIn. Pop us a note on there until next week, same time, same place. Thanks and cheers

 

The Finance Ghost: Ciao.

 

This podcast is for informational purposes only and is not financial or investment advice. Please speak to your personal financial advisor.