As you have often heard on these pages, the US Stockmarket and all its components are the world’s largest by far, comprising well over 60% of global wealth, so to coin a now not-so-handy phrase, when it sneezes we all catch a cold. More so if your investments are in a global fund, many or most of which hold between 40 and 60% in American stocks and shares. We recommend a number of ‘passive’ portfolios which use low-cost tracker funds, and the argument has long been that ‘active’ managers, who don’t have to mimic the markets to the same extent, can do better in these more trying times. Running the numbers, that’s not the case. Most held less in the US a year or more ago, and, although their funds may not have fallen as much in the last couple of weeks, they missed much of the previous increase (upside in fund manager speak) and so have grown less overall. The however-many-million dollar question, of course, is what’s next? Well, you don’t have to be too much of a cynic to guess at the many vested interests in Trump World who will want to see, and will doubtless do very nicely from the Bounce Back. In even the most difficult and worst of times, the old lore still applies: investments go up and they go down, but if you hang on in there, they do always go up more than they go down. Remember what was happening five years ago, almost to the day…
“Pensions minister: ‘we have created saving pots, but not a pension system’”
The OBR (Office of Budget Responsibility, as opposed to the OBI, often said to be housed in No.11) said this week that pensions were one of the biggest problems to be faced by this and future governments.
