Does anybody find themselves looking into their crystal ball and thinking about what coming down the road? I mean, of course everyone knows the current outlook isn't looking great, a short recession, maybe a depression? Where do you want to position yourself, not just this year but next, what sectors... recovery plays, oil to rebound, who will be the winners and losers...
I'm not actually fishing for investment recommendations here, actually the opposite, just musing about the methodology of the average investor? I often think some investor can't see the wood for the trees, blinkers are on and most investment portfolios are at the mercy of much larger worldwide economic headwinds that are just too complex and time consuming to really understand. When things are going well investors are the best thing since sliced bread, when things turn bad it's not their fault, who could have foreseen such a thing happening mentality frequently happens? I mean this isn't just limited to retail investors! Of course this is just a huge generalisation and is certainly not always the case.
Onto my actual point, are people looking ahead? If so how far ahead? 3 months, 6 months... 2 years? Are people hedging, do you have an exit plan or are you in it for the long term and just like to sit back and relax.
For those that are looking ahead, what are the major macro events that you're considering?
* A summer of discontent, large redundancies at the start of July when the government scheme runs out? Might the government extend this further and perhaps lower the furlough amount payable.. i.e keep the jobless rate from spiking as they'll only have to pay job seekers allowance anyway?
* A new normal of social distancing for the foreseeable future, I think it's unlikely the general public will flock out to bars and restaurants even once they reopen, perhaps this will vary on demographics?
* Brexit, nobody is talking about the B word anymore, will the transition period be extended?
* Developing nations such India and China are likely going to suffer as demand slows for manufacturing.
* Low oil prices, should generally help the economy whilst business gets back to normal.
* US election, will Trump get trumped?
These are just some of the things that come to mind, throw the above into a cake mix and…
