Good morning!

It's very quiet for announcements today. Apparently there was some hullabaloo last night over something said by a Fed spokesperson about if/when interest rates might rise a tiny amount. It's descending into farce if you ask me, so I just ignore all that as background noise now. Bottom line is this - we know interest rates will go up a small amount, at some point, but in all likelihood will remain historically very low probably for quite some time yet. That's all I need to know.


Although I do wonder about inflation. At some point inflation will return - especially once the price of oil rises again. Also, the pressure to increase wages, not just for Minimum Wage, but the domino effect as people higher up seek to maintain their differential above lower paid workers, is a building inflationary issue. So to my mind this means we should at least mentally prepare for higher inflation, and higher interest rates.

That might trim equity valuations in the short term, but of course longer term, equities (and property) are the best hedges against inflation that you can get, as earnings should rise during inflationary periods. Cash and bonds are the worst, as they usually erode in value at times of higher inflation - I remember seeing my Granny's savings of about £5,000 in the 1970s seem like a fortune at first, but by the 1980s it was peanuts, due to a few years of compounded high inflation. The trouble was, she saw the interest as income, and spent it, not realising that inflation was rapidly eroding her capital.

Therefore I remain fully invested in reasonably-priced equities, and think that's the best long-term position to take, if you're prepared to ride out market volatility without panic, and if you don't need the money any time soon.

It's worth thinking about a company's pricing power too - i.e. can they push through price rises in periods of higher inflation without seeing demand tail off? That may not always be the case.

Scancell Holdings (LON:SCLP)

Share price: 28p
No. shares: 225.0m
Market cap: £63.0m

Results y/e 30 Apr 2015 - nearly five months to produce results! It's not as if that time was spent reconciling their sales ledger, as it's a zero turnover company.

The loss after tax (which includes the benefit of R&D tax credits) was £2.4m, and with…

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