Small Cap Value Report (Tue 29 Dec 2020) - SWG, IKA
Good morning, it's Paul here with the SCVR for Tuesday.
Futures are up nicely, so we should have a positive day today. There probably won't be much company news today, if so I'll possibly have another hour in bed, it depends what impact the first coffee of the day has shortly.
Timing - I've exhausted the minimal amount of newsflow today, so today's report is now finished. I'm pleased that we have over 4,000 reads of this article at 12:26 - which encourages me that it's worthwhile writing stuff at this quiet time of year. I'll always find something to write about, even if it's something general, or a company that I'd meant to look at some time ago.
Covid-19 deaths
I feel that the reporting by journalists of covid-19 has seemed wildly inaccurate right from the start - giving the impression that we're all at terrible, and equal risk of death. Whereas the published data has clearly shown that is not at all true. This illness overwhelmingly attacks the elderly & sick. Finally, the Telegraph has broken cover, pointing out today;
Almost three times as many under 60s died in road crashes last year as those without health conditions killed by coronavirus, NHS data shows.
Just 388 people under the age of 60 with no underlying health conditions have died of coronavirus in England, NHS data has revealed....
In comparison, during the whole of 2019, 955 under-60s died on England’s roads.
When put like that, it does make the economic (and human) damage caused by lockdowns seem highly disproportionate. On the upside, it should mean that once vaccines are properly rolled out, that everyone not old/vulnerable should be able to get back to normal quite quickly. Press reports are saying that the Oxford/Astra vaccine is about to be approved imminently, and can be rolled out very fast, due to simple storage requirements. If that's correct, then the picture for stock market investors is looking a lot more positive. We just have to get through a few more weeks of awful news about it spreading rapidly (new strain, cold weather), before the tide turns.
Outlook for 2021
Based on information currently available, I think it makes sense for investors to be looking beyond covid, and pricing in recovery. That's happened for a lot of shares already, but there are still plenty of opportunities out there I think. That's because broker forecasts (where there are any) are probably too cautious, often with a slow recovery pencilled in.
The evidence suggests to me that a v-shaped recovery in 2021 is possible, likely even, as pent-up demand is released, by consumers who are cash-rich in many cases (middle class people anyway, not so much the case for lower earners). Some suggestions are that lockdown restrictions could be eased as early as end of Feb 2021, if enough vulnerable people have been vaccinated by then. Easter is an alternative timescale being mooted by Govt. Bravo to all the healthcare workers who are implementing the vaccinations. It's a load off my mind, knowing that my Mum now has some degree of protection. So it's not just the vulnerable who benefit, it's also their loved ones who don't need to worry quite so much.
Many companies have restructured, stripped out a load of costs, and worked out ways to operate more efficiently during this crisis (e.g. using Zoom instead of flying people to see clients in other countries). Therefore, we could see earnings not just recover to pre-covid levels, but rise above in some sectors, perhaps?
Hence my outlook for 2021 is largely positive for equities. In any case, what's the alternative? A bank account paying nothing? Over-priced bonds, where you risk some/all of your capital potentially, for a paltry return? Property - where you have all the hassle of ownership, and managing tenants? To my mind, equities are the only game in town, and if we look hard enough, there are still attractive shares out there.
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Shearwater (LON:SWG)
Share price: 154p (up 10%, at 08:30)
No. shares: 23.8m
Market cap: £36.7m
Trading update and New contracts secured
This is a new company for me, I've never looked at it before. It seems to have been previously called Aurum Mining, which morphed into a new business in early 2017;
The Company will focus on the acquisition and development of businesses operating within the fields of information security and cyber security, with the aim of building a group of significant scale providing digital resilience solutions to UK based private and public sector organisations.
[Source: RNS 21 Dec 2016]
Interim results (6m to 30 Sept 2020) look a bit lacklusture;
- Revenues down 32% to £11.2m
- Loss before tax of £(780)k - improved from £(1,468)k in H1 LY
- Adjusted profit before tax £365k - the main reconciling item being a £1,050k amortisation charge relating to goodwill on acquisitions - which is fine to strip out, so I can live with the adjusted profit measure
- Underlying EBITDA positive at £1,062k
Balance sheet lacking strength, although not alarmingly so, with NTAV slightly negative at £(127)k. Although I see long-term creditors is mainly £3.2m deferred tax, which can usually be safely ignored. If we strip that out, then NTAV would become positive at £3.1m, which is probably adequate for a small service sector business.
The balance sheet is dominated by intangible assets, relating to acquisitions, which I always tend to write off in full.
Cashflow statement - note that it raised £3.75m equity in the last 6 month reporting period, which was used to pay down debt.
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Today's update -
New contracts secured by Brookcourt with multinational investment bank
Shearwater shares were suspended for a while in 2018, whilst this "transformational"acquisition (£30.3m - almost as much as the current market cap) was implemented. Brookcourt is a cyber security solutions company. A placing & open offer was done at 3.6p per share. A 1 for 100 share consolidation was implemented in 2019.
What's that old stock market saying? Sell a consolidation, buy a stock split? Something like that. It makes sense, because share consolidations are only usually done by poorly performing companies, who are embarrassed that their share price looks mickey mouse, at a few pence, or even fractions of pence. Whereas shares that go awkwardly high, and are split, are obviously things that have been very popular with investors & done well. Although as with all stock market adages, sometimes they work, and sometimes they don't.
As you can see from the 3-year chart below the excitement over the Brookcourt (sounds like a block of flats) acquisition left investors nursing a hangover;
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Despite this fall in price, the market cap of £36.7m doesn't look a bargain, for a group that's not really making any significant profit.
Shearwater Group plc, the organisational resilience group, is pleased to announce a trading update for Q3 FY2021 to date. The Group also announces a number of contract renewals and new wins for its group company, Brookcourt Solutions Limited.
Surely they could come up with a description of the group that makes more sense than "organisational resilience group" - that could mean anything! Not a good start, if a company can't even explain what it does, in plain English.
Trading update - for FY 03/2021 to date - this sounds pretty good -
Further to the Group's recent interim results announcement, Q3 trading has continued to be buoyant with recognised revenues for October and November 39% ahead of the same two months in the prior year, as previously announced delays in recognising secured orders have come through in the current quarter.
Strong momentum has continued into December. This has materially reduced the year-on-year revenue deficit reported for the first half and the Group continues to track in line with profit expectations for the full year.
Unfortunately, we're not give a footnote to explain what those profit expectations are.
A Cenkos note from Nov 2020 indicates forecast revenue for FY 03/2021 flat vs LY at £33.0m, and decently positive adj EBITDA of £3.4m, reducing to an adj loss before tax of £(1.1)m. I'm struggling a bit to decide which figure to latch onto for valuation purposes.
My opinion - this looks a good update today, with delayed contracts seemingly returning. I like the area of cyber security, as it's so vital for all companies to secure their systems and data, and we read about hackers breaching systems almost every day.
As it's the first time I've looked at this company, and I don't really understand what it does, then I can't really offer an opinion on it. A contract win announced on 10 Oct 2019 looks impressive - an £8.5m contract with "one of the UK's largest telecommunications companies" seems to offer strong validation of the services provided by Shearwater.
It could be worth doing some more digging on this one, perhaps?
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Ilika (LON:IKA)
Share price: 252p (up 25%, at 12:17)
No. shares: 138.6m
Market cap: £349.3m
This share has been in a vertical move upwards in the last week or so, as you can see;
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The company issued the following statement at 10:04 today;
Statement re Share Price Movement
The Board notes the recent rise in the Company's share price and the growing interest in solid state batteries in the media in recent weeks regarding their future potential in automotive applications. The Company reiterates its guidance set out in the announcements dated 11 and 24 November 2020. In particular, whilst the Board is confident about the prospects for the Company's Goliath larger format batteries, mass market commercialisation is dependent on further technical development and successful manufacturing scale-up.
The interim results for the period ended 31 October 2020 will be released on 14 January 2021.
The way I read that, it seems to be pouring cold water on the huge rise in share price, saying basically that there's no new information.
My opinion - this has speculative frenzy written all over it.
Good fun, if you can time your entry & exit points to perfection.
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All done for today! See you tomorrow.
Best wishes, Paul.
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198 comments
No way am I selling IGG but then I am not a trader . This is a quality company that I intend to hold for the longer term . In fact I could state the same about 80% of my portfolio even though most have risen strongly in last month or so.
I have to say that the majority of today's posts were totally irrelevant to investing.
If posters wish to trade covid statistics, and occasionally barbs why not do it elsewhere if you feel the need to get yourselves in print so often.
Not what i wanted for my stockopedia subscription!.
I look after a website where content that is not relevant to the discussion is not allowed to clutter up the true contributions to avoid us all wasting time .
Disappointed investor.
Agreed. Guess as few Companies to report on some people have lots of spare time. Don’t mind discussions on the effect Brexit/Covid may have on equity markets and/or individual shares but it’s boring all this arguing about who has allegedly done better than others at managing Covid etc.
Let’s please concentrate on Stocks as in Stockopedia !!!
Well guys and girls. Hope you had a jolly Christmas even if it was a bit duller than normal! I've got a hunch that a lot of people didn't like it after scanning through today's SCVR. Perhaps it was a little like the other gazillion days in 2020 when we were locked up in the house alone or with the ones we love...but they were really bugging us (that's what my mate said anyway when we had a walk in the park...he was v grumpy).
Brexit, covid (and Thg Holdings (LON:THG) ) are among my least favourite topics partly as I'm not on the side of the 'angels' for any of them and can't be bothered submitting myself for a kicking ;)
Anyone want to sell me 8 weeks of total lockdown (more thorough than ever before) from now but accept that after that we enable significant freedom of choice regardless? Still protect those that need it and take some precautions etc. I'd take that just to move on and break the hiatus. Obvs a troubling mutation makes 8 weeks useless...but I really don't believe we can tolerate (socially, psychologically, educationally, economically, ahem...sexually) another year of the same. We can't repeatedly bend to the bug...it doesn't matter whether we created our own problems in the past as that's now done and baked in. We can't be Wuhan...as some commies seem to think :)
Here's hoping for a more more stock biased Wednesday!
I enjoyed S&u (LON:SUS) rise today - IMO its just about the most obvious combo of value, growth and quality in UK! Just got to not hate it as its an ugly duckling financial. Nevertheless, surprised this very boring stock jumped so much. Anyone got a view why other than end of year mad moves?
“Here’s hoping for a more stock biased Wednesday”.
That gets a 100 thumbs up from me!
Good to see that the spirit of goodwill and kindness to all is prospering today.!
I thought we had burnt ourselves out on the Covid acrimony earlier in the year. How wrong I was!
But it is panto season I suppose. So, I should not be surprised to hear an argument basically along the lines of my scientists were more accurate than your scientists, oh no they weren’t, oh yes they were! The US didn’t have significant lockdown measures, oh yes it did, oh no it didn’t! The lockdown was late and insufficient, no it wasn’t - it was too strict and achieved nothing but economic harm! Hospitals are overwhelmed with Covid patients, oh no they aren’t and it doesn’t matter because they haven’t died yet!
Isn’t it interesting that there’s so little discussion of the Brexit agreement?
Sorry to digress back on to Investing...
IG Group (LON:IGG)
Central Asia Metals (LON:CAML)
Apax Global Alpha (LON:APAX)
EVRAZ (LON:EVR)
all at year highs
What to do? Hold, let the dividends come round and sit out results season, or sell into strength?
Every year, my shares seem to peak this time of year, especially one year ago...
What would more seasoned wiser investors suggest one does?
I only have APAX from that list but I guess the answer is it depends on your personal situation. I personally have a full time job and reinvest all of my investments and don't plan to draw on anything for at least 5 more year but probably 10.
So for me I might sell if I'm not going to breach and capital gains limits or I think a particular share is overvalued or something has changed which makes me not want it hold anymore. Otherwise I will continue to hold until such time changes or my personal situation changes. My best performing holdings are all one's i have held for over 3 years so my lesson is to hold them as long as they continue to perform.
On the other hand if you have a shorter time horizon and need some income from investments for other things its not a bad idea to top slice some of the better performers when the going is good.
I don't think you should base your future plans on what happened one year ago - hopefully it will be a while before share prices are affected by another event like the pandemic.
Hmmm, well, I can only speak about Central Asia Metals (LON:CAML), which has just hit my technical target. But, as long-term holder, I would say it has been well-managed this past year, and will return to its former dividend level. Given that copper now higher than it was in Jan 2018, reason would suggest a return to the price it was then, 300+p. Anyone wish to counter?
One of the hardest things, I think, is selling in early January, when new-found popularity boosts stocks, betting that you'll be able to buy them back cheaper in July.
Isn't the Covid debate exactly like the Brexit debate - pointless. Everyone just latches on to whatever report coincides with their view, and hardly anyone changes their viewpoint.
Roll on some more company news
I don’t know Bob. I’ve found myself having the opposite problem. I ignored CV19 in January and February except to have conversations with friends of how the news broadcasts looked like the start of a disaster movie, did a lot of reading and got very scared in March (where I read reports that were talking about 10% morality rates) before government started to act, welcomed the lockdown in April- May even though it devastated my business, kept reading and started to doubt in June July pissing off most of my middle of the road mates when I started to rant, had completely changed my mind by September and now find myself in two camps depending how I’m feeling.
The point I’m making is some people may just take in information that confirms their biases but for me, CV19 has been a learning experience and my viewpoint has changed this year on government action etc. This is unusual for me - I am normally pigheaded and stubborn when I think I’m right but CV19 was so outside my knowledge base I had to be willing to learn.
i think the morality rate is a lot higher... sorry.
I think it is higher here than in other corners of the internet.
SPAC stands for a special purpose acquisition company. I know these are widely used in the USA and I see one was launched in the UK on Xmas Eve:
"Pineapple Power Corporation PLC, a UK company established as a special purpose acquisition company to seek and acquire businesses in the clean energy sector, is pleased to announce that its ordinary shares of £0.01 each have been admitted to the Standard Segment of the Official List and to trading on the Main Market of the London Stock Exchange".
I don't think many brokers have listed this stock yet ...ticker is PNPL ..... the first of many SPAC's I guess and on the full list too, not AIM. A bull market idea perhaps? Hot sector of course and fast access to capital I guess
IG has Pineapple Power (LON:PNPL) listed and it is up 26.92% in today’s trading. Your post has certainly prompted me to find out more barnetpeter.
I listened to an American broker a few weeks ago talking about the recent rise of SPACs in the US. She talked about how she was approached multiple times towards the end of 1999 by people who were raising money but they were at the “Pre-idea” stage. How insane is that? Give me money and then I’ll go and have an idea for a great business.
I think SPACs are a bit like that - they may well work out brilliantly but why would I invest money in something I can’t evaluate? I’d rather wait and miss the beginning so I can actually judge the merits or lack thereof.
Sorry did not make it clear. QS only competing with IKA's Goliath program for EV's. QS largely funded by partners VW. IKA partnered by Honda, Nissan,Jaguar Landrover, Ricado and Maclaren.
The Stereax program will bring revenue much earlier. Really clever. In the med area they can put batteries on contact l,enses, batteries into heart monitors that are recharged by the heart beats etc huge area. British Rail putting sensors on tracks to obviate the need for inspectors having to walk tracks.
They did some work with Toyota too, not sure how much they still work together.
Hi All,
ETF INVESTING
relatively new to this.....
Whilst I do have individual shares and IT I have not ventured into the world of ETFs. I have recently read this article, which is US focused.
https://www.kiplinger.com/investing/etfs/601891/the-21-best-etfs-to-buy-for-2021
global x fintech ETF FINX
Ark innovation ETF ARKK
Distillate U.S. Fundamental Stability & Value ETF DSTL
I like some of the themes they mention but am not sure how to go about investing in them as they are US$ denominated. I have typed the relative tickers into HL or AJ Bells and nothing came back.
q: does anyone know of platforms that allow investments in these?
q: or could point me in the direction of similar UK ETFs.
I also understand the US market is not the cheapest at the moment...
Thanks.
Eqi do etf's. The strong pound relative to the US dollar is affecting US investments at present and there are currency charges on buying and selling which may seem high. There will probably be others on here who use cheaper brokers but I am able to buy them in my SIPP.
HL do ETFs as well but not all of them.
Can you buy all those ETFs with EQI?
I have checked and can confirm they all appear. They have a considerable number of ETF's. I have also bought sterling ETF's through my ISA with Barclays related to the US market.
I have bought ETF's through my normal share dealers (HL and Barclays) but it's not the cheapest route I think, as they charge a fee to hold them for you. I think you can set up a Vanguard account directly in the UK? They seem to be the most popular ETF's because they were set up by John Bogle in the US with the deliberate aim of minimal fees to take on funds. I'm no expert though.
I had to check the HL fee, it is “It is free to hold ETFs and ETCs within the HL Fund & Share Account. The annual charge to hold ETFs and ETCs in the HL ISA or SIPP is 0.45% (capped at £45 p.a. in the ISA and £200 p.a. in the SIPP).”
So quite cheap in an ISA but SIPP is more expensive, l will have to watch that. I have a few in my ISA, so £45 per annum is not too bad.
IG allow you to invest in these. Hard to find good GBP denominated specialised tech ETF investments, many more $ denominated. Downside is currency charges. Def not perfect!
I use this website for ETFs. It only lists the UK listed ETFs. https://www.justetf.com/uk/fin...
I tried buying Global X Cloud Computing & Ark Genomic ETF in the summer but no UK platform seems to allow it (I tried HL, InteractiveBrokers, Plus500). I rang HL & they said they have asked for authorisation internally & always been pushed back. I contacted Ark direct & they said you have to buy as a US citizen in the US who have a US brokerage account. I gave up. There are UCITs with similar style & return profiles. I own Blackrock Next Generation
https://www.cebm.net/wp-conten...
There, unsurprisingly, seems to be a lot of fear and concern re Covid, which then obviously has a knock on effect in relation to investments. I share this Nightingale chart, from the Centre for Evidence Based Medicine, as a bit of context re the extent of excess mortality arising from Covid (and indeed from the impacts of Lockdown) ie first wave in April, May...clear and obvious; second wave, despite all the lurid headlines, not so much.
Secondly re concerns about vaccines and mutant variants of Covid. The good news is that Modena and Pfizer vaccines have both been created with new technology (mRNA) that enables them to be tweaked in a matter of just days if Covid mutated in such a way that current vaccines became less effective. Even more importantly, they do not need to go back to patient safety testing (Matt Ridley argues that this innovation, ie use of mRNA, could be one of the most important medical innovations of the century) and so could be produced and distributed in just days. That said, the vaccine companies all seem very confident that the new variants do not present a risk to current vaccine effectiveness.
There are also many scientists who are extremely concerned about the false positive rates for PCR, particularly in the large scale private laboratories. The impact of this is that we may all be reacting to a level of infection that is false, particularly as the volume of testing keeps going up and up (over 500K during the last week).
Anyway, it will be spring soon, and as usual the warmer weather will bring a natural reduction in respiratory infection, along with the impact of the vaccines.
Martin
Paul, The IKA price I think is very much due to the $39billion IPO in the US for Quantumscape . They are building a gigafactory to build EV batteries along the same technology as IKA. Graham Purdy says they are no further forward than they are. IKA is close to production of their Stereax range for medical devices for wearable/implants together with industrial uses. They have very little if any competition in this area and it is a multibillion pound market. The battery is designed with the battery giving a wide moat.
The reason for the price rise is due to heavy buying in the US OTCmarked from Americans who see it a btter bet than the QS IPO. IKA prices have reached $4.20 (£3.10) there. I shows the difference in how US value tech stocks. Might IKA list on NASDEQ?
Hi jraitt,
Interesting background info on Ilika (LON:IKA) many thanks, Paul.
Hi Paul,
I was wondering if you had any views on Cairn Energy, I know its technically not a small cap but given the recent court victory I wondered if you had any thoughts/network on how this money might be deployed/returned to shareholders (India lost another international arbitration case this week,
against Cairn Energy CNE.L , over a tax dispute. It has been
ordered to pay the UK-listed company over $1.2 billion in
damages and costs. urn:newsml:reuters.com:*:nL1N2J4043)?
Thanks
Mark
I pitched this at Paul on the day of the arbitration outcome. I hold too. I think the first question is when will they get the money back and in what form. To my mind more likely that CNE will be encouraged to reinvest at least some of it in India (this would be the canny response from the defendant. I also think that they will comply btw. India need to not be seen as the Wild West). The retrospective CGT case was preposterous and did a lot of damage to sentiment about investing in India at the time) I also think that some of the award was already priced in, perhaps 50pps. I am mystified as to what is now holding the share back though. The award plus accrued interest and costs is approx the pre award market cap. This is huge and if the market was rational the price should be motoring up this week unless the market makers are pegging it back to fill a big order?. The special dividend re the Senegal sale will be putting off some PIs I think as it essentially is a capital to income switch and the proposed consolidation post this to maintain the current share price makes no sense unless it is an effort to reduce the number of shares in circulation and if this is the case why not go with a simple buy back. I don't get it.
W.r.t Cairn Energy (LON:CNE) - the question is probably not when but if they get paid. The Indian government have now lodged an appeal vs Vodafone. Likewise they will do the same with £CNE. This probably explains the muted response in the market to their victory. Thus, another few years of dragging on. I don't hold Cairn Energy (LON:CNE) but as a holder of Trinity Exploration And Production (LON:TRIN), I was delighted to see £TRIN's SP skyrocket over such bullishness over £CNE's victory which somehow will make £TRIN's Jubilee JV with Cairn Energy (LON:CNE) flourish (?) - my ignorance - I did not understand how £CNE's victory would lead to £TRIN's SP going up. Anyways, I sold out of Trinity Exploration And Production (LON:TRIN) on the view that the rise was a tad overbullish (despite Trinity Exploration And Production (LON:TRIN) having excellent fundamentals).
Sorry Mark, I don't look at any resource sector companies - it's a specialised sector, where I don't have any knowledge. Also, there are just too many companies, so impossible for me to cover. One person trying to cover 500+ companies is quite challenging already!
Hi Paul and fellow readers,
As news flow is light at the moment I thought I would draw to your attention a recent interview on BBC Hardtalk by Stephen Sackur with Professor Peter Frankopan (https://www.bbc.co.uk/iplayer/... Professor of Global History at Oxford University and author of: The Silk Road)
The interview looked at the historic aspect of the Covid-19 pandemic and how both East (China) and West (USA) dealt with matters. Some interesting stats he did throw out in the interview, include comparisons against the Spanish flu epidemic and the rise of China and the burgeoning wealth equality gap there.
The takeaway line for me, was when asked by Stephen Sackur: when was the best time to live in the last 200 years, he said now and said very clearly pointed to democracy,: "Freedom and democracy offer hope".
Might be of interest to some
Mark
Mark -Thanks for the link.I am just reading The Silk Roads which is an immensely impressive history of trading routes “from the beginning of time” and their social and economic impacts.With one belt ,one road vision set out by Xi Jinping in 2013 and intended to be complete by 2050 Professor Frankopan concludes that the Silk Roads are rising again!
Mti Wireless Edge (LON:MWE) up 11% today on no news. I've held this for a few years from the low 20's and seen it go from being very stable moving to very volatile this year as people have got excited over the contract wins and 5G opportunities with their partnership with Nokia.
Long term I still think there's a lot of value in this if they continue to execute and make progress in their water technology and in the 5G space but the volatility is in a way frustrating with clearly traders deciding this is one to dip in and out of.
those are brave traders dipping in and out of such an illiquid share with small free float and a usually big spread. Simon Thompson's recent tip has generated a fair bit of interest. I like this one too, long term holding for me.
Hi Guys, Sorry to ask a dumb question, but can anyone explain what is the best way to search the past SCVRs for a particular company/ticker? I've tried the search bar at the top of the page and it does throw up some hits but they are invariably a few years old, and I know the companies I'm searching for have been in the SCVR this year. And apologies if this isn't the right place to ask this, but I couldn't find a Help/FAQ section on Stockopedia either.
TIA
Hi Maylix,
I tend to use the "Discussions" tab on the main stockreport for any particular share I am interested in. It will usually find all the relevant SCVRs but depends on the tickers being listed in the title of that day's SCVR (I think).
Maylix. Perfectly reasonable question.Just click on anything blue and something interesting comes up! Try 'discussions'
Maylix -
I use the Discuss tab at the top of an individual stock report but have found, like you, that recent ones have been missing. This is because of the haphazard way it is updated on the old site. Take Boohoo (LON:BOO) for example - the last SCVR comment was by Graham on 3/12/19! Go to the new site and you find dozens more in 2020.
I still use the old site because it is much easier to navigate and has a better layout. If I want to visit the new for things like this then rather than switch my whole use to the new and then have to switch it back again I simply overwrite 'www' with 'app' on that particular tab and it is not kept as a preference.
Paul, Over 60 may seem "elderly" to you now but I promise you it won't feel that way when you get there!
Over 70 no longer seems elderly to me.
think what over 70 feels like when increasingly, as on here today, the undertone of many of the anti lockdown sentiments are that oldies are dispensable. Effective compulsory euthanasia as part of the long awaited Social Care proposals?
"Effective compulsory euthanasia as part of the long awaited Social Care proposals?"
Its not though is it.
It is a temporary inconvenience which, we hope thanks to science and technology, should all be over in a year.
And what are the old people going to do anyway during Winter when its 0C outside?
Personally I run and so does my wife but most of our friends walk.
You know what's going to be in these proposals? Do tell? Better Care Homes than the ones where so many have suffered the "temporary inconvenience" of dying?
It was 0C outside today and at 76 yoa I was out there pheasant beating.
Catching up on Stocko now, it's something to look forward to.
Morning All,
Here I am , like everyone else speeding the Christmas new year period on the look out for the best post covid uptick stocks and wondering if the sea of free money from Santa will in fact drown us all . Looking at the fund managers a 2021 theme is Sell the USA and buy Europe China and gold, allocate c 10% to SME ( target 75% pa cash on cash on the SME slice as kicker)
-As a non cricket playing (ex?) Aussie in London Im following the Australian market closely , as they are about 9 months ahead of us as (i) they are all in a good relaxed mood lounging around until mid January as its high summer there now and (ii) they are about 9 months ahead of us with covid recovery boosted by gold .. covid impact was slight ( less than 200 deaths) ).
Key takeaways to share from the down under market at T+9 months from my highly sophisticated intertemporal post covid risk matirix predictor
Are her any clues from the Australian market s to where we might be in summer 2021?
- residential is robust,
- Dont touch LNG coal anything thats not "ESG"
- airlines are still lagging ( apart from domestic carriers) also retail, hospitality
- gold IPOs, SMEs booming - also in Canada
- Sydney Airport stock has jumped up on domestic travel, while Qantas ( International carrier) lags
- aluminium, nickel paladium platinum a buy signal ( metals required for green energy solar/ electric)
- Im not a gold bug-but noting that Gold tends historically to increase in value as the USD falls, and vice versa( 10% devaluation in USD = 50% increase in gold price) and vice versa I see very few / no large sellers of gold
- Transport - rail, maritime transport tends to increase faster than airline transport ( infra largely fully recovered/priced in )
- Looking backwards - long term international Australian large cap funds 2011-2020 600% increase in unit value , perhaps its the objectivity from the world markets which helped get the winners selected)
Other themes in my Boxing day reading
USD 780bn peak margin lending debt on USA internet platforms - 2020 the first fintech platform enabled speculative stock market boom
EMEA GDP uptick winners post wave 1 ( % terms) France and Italy,15-20% Q3 versus c 7% for UK Germany (Q3)
Brexit..
International view of UK 2021 -UK is downgraded - Debt/ GDP is now too high 120% of disposable income low productivity and lack of training ( not supportive to innovation) wide and visible disparity between London economy versus the south east and rest of the country . on the positives strong hydrocarbon reserves, financial system cutting edge aerospace, automotive
While course investors , like cockroaches Toyota Corollas and Goldman Sachs bankers can survive any sort of weather .. interesting to observe that various international agencies view domestic UK support for Boris Johnsons Government as declining.
Im swotting up the SME space.. if any are happy to share a grab bag of names which are possibly still a broad buy signal I would appreciate otherwise I wil (re) charge the coffee cup and enjoy digesting the treats that that Jack and Paul have kindly provided the past 6 months or so!
Loving the site guys thank you!
Great piece PE, really interesting perspectives, thanks.
Just re: metals, have seen plenty of support re: (certain) commodities & whilst I hold CYN, have been waiting (to little avail) for a drop/entry point into a BERI/BSRT/BRWM, rather than take the risk of a single stock.
Note the comments on gold from a place where it’s well understood !
Thanks for the tickers appreciated i will have a good look and think- I am a property developer learning the stock market ropes .. My thought is to simply use 40% Lombard margin at 2% pa.a on part of the book or to simply do this at 40% on Berkshire Hathaway for 5 years hold it ignore it and do other things - like hitting the gym !
This is my down under bag of Minerals s CHN,HZR,ELO,FEX,SNG,XRO,PHOENIX, JUPITER,GRR .Refer also Market index site
Check out Marin Katusa in Vancover for SME Minerals +IPO access, Morgans stockbrokers in Australia for SME IPO Minerals ,
Broadly UK from a UK real estate perspective i see clear mismatch between private asset and public traded markets including in Student I see student RIETS as to par within 18 mths ( eg Empiric) at 40% margin is 40% upside qt T+ ? 18 mths - its enough and risk mitigated by the incumbency of the business - currently 85p , Goldman Sachs taking a big lump of International Consolidated Holdings ( BA) in October with a target of £4.00 over 24 -36 mths is another idea on 40% margin ..My Best Phil PJ
Hello Phil, as you're 'down there', you might like to take a look at Tectonic Gold (OFEX:TTAU), Tectonic Gold. You won't get much out of Stockopedia on it, as it's too small and on the Aquis exchange (London-listed). Or just go to their not-very-good website and read the reports. They don't have time for fancy websites and are essentially a Queensland gold explorer, using relatively novel scanning methods to find gold seams. On the verge of success, I hope (being LTH)! But if you have any perspective, I'd be interested.
Further away and a little more normal, a small gas produced in Tanzania, Wentworth Resources (LON:WEN), is rolling now. So the opposite, ni big capital gain likely in the next year, but 8% div.
RE SWG.
Morning Paul. SWG has been a bit of a disappointment to say the least. Jack covered it back in June when we were waiting for overdue results and news on a possible acquisition, which was what the placing was supposedly for.
The big drop in revenue (30%) was somehow countered by being able to pay off a £4 million legacy loan and maintaining the cash from the placing. They are still actively looking for an acquisition that they feel enhances the current portfolio and stressed they are not looking for a company that needs fixing, which is a relief! One of the points they made at their recent presentation was that they were beginning to see the benefits of cross selling between companies. I think they also said that on top of delayed contracts reviving, they had a £2 million contract landed for next financial year.
All the directors bought heavily into the placing on top of big purchases just over a year ago. I asked them about direct competitors and they mentioned they were in some areas competing with Intercede. Like IGP they have few shares in circulation and are quite illiquid at times to buy or sell.
There has been a consistant seller in the market who they feel is now out. One of the slightly stranger additions to the substantial holders list was Spreadex who were matched to one of the big sellers, who came in for 3% this month, and Higgins transferred a number of shares into family ISA's.
They have won numerous awards for their products and earlier in the year volunteered their services for free to help one of the London universities develop a Covid tracing system. So I'm hanging on in there reasonably optimistically.
Worth mentioning that it's not just the healthy under 60s that are virtually unaffected by this virus. Healthy over 60s are also surprisingly low risk. The proportion of deaths purely from Covid with no underlying conditions vs those who have Covid put on the death certificate because they tested positive in hospital whilst dying from cancer or something else is under 4% amongst the over 60s.
Sure the disease is a concern like any disease that can prove fatal to the elderly and vulnerable but I am hopeful that at some point most will recognise that the response has been a massive overreaction. Let's just hope the damage to our economy has not been as terrible as it appears right now.
If I could add a bit of balance to andyinbath's comments and perhaps try to speak on behalf of the 70,000 + people who have died at least in part as a result of COVID-19, I would suggest that the government's response to COVID-19 has been an underreaction bearing in mind the failure to contain the spread of COVID-19 which is now out of control. It also has to be borne in mind that we still know little about the virus and its ability to mutate to forms which may evade the vaccines or be more pathogenic so I think there is plenty of evidence to suggest that the government's response has been the bare minimum, bearing in mind the risk to human life.
"we still know little about the virus and its ability to mutate to forms"
I don't agree with that.
The resources of the entire world have been thrown in to this problem, solving problems in record breaking times, with practically unlimited budgets, and both history breaking levels of man power, computer power, and A.I. on the problem.
Its just a bug... been around for millions of years.
70,000 is less than numbers killed by obvious and known factors like... The Sun, pollution, toxins, asthma, etc... and that's before we get on to the big killers such as cancer, heart disease, obesity.
*You* may not understand it, but the scientists and pharma do.
Wasn't aware that reading The Sun was that dangerous.
Really?
"More than 12,700 people have died from asthma in England and Wales in the last decade"
"Really?
"More than 12,700 people have died from asthma in England and Wales in the last decade"
DYOR
I did: https://www.asthma.org.uk/about/media/news/press-release-asthma-death-toll-in-england-and-wales-is-the-highest-this-decade/#:~:text=Asthma%20UK's%20analysis%20also%20revealed,and%20Walesin%20the%20last%20decade&text=There%20has%20been%20a%2017,the%20last%20six%20years12.
Nothing like 70,000 per year, last year was around 1,400.
"Nothing like 70,000 per year, last year was around 1,400."
Now add up the other +1000 types of related diseases and cancers we routinely dismiss.
https://www.gov.uk/government/news/public-health-england-publishes-air-pollution-evidence-review
"Air pollution is the biggest environmental threat to health in the UK, with between 28,000 and 36,000 deaths a year attributed to long-term exposure. There is strong evidence that air pollution causes the development of coronary heart disease, stroke, respiratory disease and lung cancer, and exacerbates asthma."
There you go. Half way there in one Google.
https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/deaths/bulletins/deathsrelatedtodrugpoisoninginenglandandwales/2019registrations#:~:text=1.-,Main%20points,there%20were%204%2C359%20registered%20deaths.
"4,393 deaths related to drug poisoning were registered in 2019 in England and Wales, equivalent to an age-standardised mortality rate of 76.7 deaths per million people; this is similar to the rate in 2018 (76.3 deaths per million) when there were 4,359 registered deaths."
Scrub another 4,393.
And we haven't go to the takeaways, bad diets, road casualties.
Bored.
Oh I see you have to add up numerous other diseases and reasons to get to 70,000 deaths.
I understand now.
Wow!!
So many (random) covid comments today - nothing personal UK_investor_8888 but the spinning bottle stopped at your name, so I will pick on yours ;-)
That's less than HALF of the covid deaths - Why the Heck did why sign-up to the Paris Agreement? Why the heck did we close down UK Coal Mining - bugger - that was something we were really good at - can we restart it? (I heard an environmental expert - Professor Trump - telling us it was really clean technology)
That's a truly trivial number - the chances of any of us here knowing someone affected are miniscule - let's abandon the MHRA and take away the "closed shop" / protection racket that is licensed pharmacies.
Honestly we are living in Orwell's 1984.
#WhyDoWeNeedRules.
#ForTheAvoidanceOfDoubt this post should be considered as feeble humour.
Had three funeral-worthy personal acquaintances pass recently, one cancer, one old age, one Covid. The Grim Reaper isn't choosy.
UK_Investor888 by way of further explanation, the reason that scientists still know relatively little about the way this virus behaves is because it has been prevalent in the community for less than a year. For example, scientists do not yet know how long the vaccines are likely to provide protection for or how frequent changes to the vaccine will be needed. Sensible guesses can be made about this but it all depends on the behaviour of the virus in the environment and this knowledge will come with time. Initial analysis indicates that the SARS-CoV-2 is unlikely to mutate as frequently as influenza, a virus which scientists have a good understanding of, but we already have a variant of SARS-CoV-2 which has emerged with significantly increased infectivitity leading to a loss of control of the virus in the UK, so this tends to underline the fact that scientists are learning as we go along. Having said that, we certainly know alot more about the virus than we knew at the start of the pandemic and the development of multiple effective vaccines in such is a short time is indeed a remarkable scientific achievement.
https://www.nature.com/article...
This leads me to believe the scientists are following processes but they don’t truly understand it.
I agree but as well as the deaths there are large numbers of people with often debilitating long term symptoms. the latter include two premier league footballers who have not been able to return to playing.
Define large. Preferably with a sensible denominator. It's post-viral syndrome. Unlucky and definitely not pleasant but common to many other viruses .
70,000 is around one in a thousand in UK's population or a bit more than two full football stadia.
Since the nearly 12 month pandemic, the medicine has learned better ways of treating hospitalised Covid patients. The chances of survival are greater, but only if there is capacity in the system. Otherwise, the mortality rate will increase sharply.
From a UK investor's standpoint, this means the Government will continue with policies to cap the number of infections at any one time. It looks like a further lockdown is heading our way very soon. I expect this will last for longer than some expect, because once this upcoming one finishes, consent for anything more will be non-existant.
So the usual suspects (hospitality, travel,entertainment, holidays) will have to have balance sheets strong enough to keep going say until April/May. Even then, what will happen to a financially very weak company, in the face of more prudent competion? For example Ryannair could eat their competitors lunch if the chose, being in a position to price them out the market.
I guess, the place to look for investments are companies (such as Ryannair) where competitors have failed during the crisis. Just wonder what these would be ? Pubs and bars, rather than restaurants? Lowest cost travel companies?
Surely we are just trying to protect the NHS from being overwhelmed.
It should be hospital admissions that is the key number. According to this data 71,000 people from the 18-64 bracket have been admitted so far, and 92,500 65-84 age group. So still a large proportion in that younger age group.
https://coronavirus.data.gov.u...
on the good side over 1/2 a million have already been vaccinated in England alone :-)
"Surely we are just trying to protect the NHS from being overwhelmed."
I'll bet you £50 my local hospital is a ghost building today.
The local GPs surgery had about 1/5th the number of cars parked in it when I walked past a few minutes ago.
Who is going near their doctors or hospitals now unless they have Covid or are very seriously ill?
Many appointments are being done over the telephone. Maybe we will be having zoom appointments next?
Wife works as a doctor in a quite big regional hospital.
3 consultants and 8 nurses have died of Covid in 9 months.
Sad news indeed IGPJ. But whenever I go to a hospital these days, it looks to me like NHS workers have become at least as obese as the population at large, and obesity, as we have been told, is not good news if Covid is coming your way.
On the one hand, you would think that NHS workers, of all people, would know the dangers of being obese. On the other hand, working NHS shifts (and grateful ex-patients bunging boxes of chocs) is not conducive to a healthy diet and enough exercise.
Dear All, I wasn't planning to post during the festive break but all the blue this morning stirred me into action!
Here are my heat maps for today (prices as at ~11am).
Overall state of the market by ICB Industry classification:
Key to the Industry heat map contents:
SVCR world filtered to 'interesting' instruments ('interesting' means: reporting soon or recently; trending; breaking out; increased volatility - volume / ATR up; moving more than a 20d EMA of the ATR):
Small Caps with RNS news today ("N!!" in bottom row of the heatmap tile means report / update today):
Big movers today in the SCVR world (moving more than a 20d EMA of the ATR against either yesterdays close, or today's open):
Big movers today (not restricted to small caps):
And finally the key to the heat map contents:
The heatmaps are ordered by Stock Rank™, and are limited to the top 75 instruments. I define Small Cap using the Stockopedia Small Cap Size Group definition: Market Capitalisation between GBP 50 million and GBP 350 million.
The heatmaps are images and will be resized by your browser to fit your screen. If the heatmaps images are too small to read on your screen, right-click on the image and select 'Open image in new tab'. This will open the heatmap in a new tab in your browser where they can be zoomed as necessary.
I use heatmaps a lot and generate many (from my own application and database) to help focus my research. I use them to help me quickly find instruments which pass my basic 'tradeable' criteria (a 'T' in the top-right of the heatmap tile, meaning: profitable; low-debt; reasonable liquidity), have a high Stock Rank™ and Quality Rank, and are trending (Tr+ or Tr++) or breaking out (Br+ or Br++) ideally on increased volume (V+). I then research the identified instruments in more depth using the Stockopedia StockReports.
How (or indeed if) you use these heatmaps is up to you, I contribute these SCVR related ones here in the hope that others may also find them interesting or useful. I aim to post sometime in the morning when I can, but sometimes work / family and other priorities get in the way.
Wishing you all a successful, and safe, 2021.
greensiax
There is always something new to learn even in imending senility. I have been glancing at these heat maps for the last several weeks now, not really understanding them. Today I looked at them a bit more closely and yes there is some point in them in making due diligence more efficient. Understanding them in geater detail is now a new year resolution high priority.
Thanks greensiax
best wishes to all for 2021
Hi 23Jez,
So I'm producing them to stave off senility myself and I'm not sure I really understand them either. But I enjoy the process ;-) Thank you for finding a point to my efforts ;-)
Seriously though, I'm very open to suggestions to improve them. Perhaps my New Years resolution should be to determine what the SVCR readership would find most useful?
For myself, I tend to produce the heatmaps very focused on my selection criteria (low debt, high quality, good liquidity, doing something 'interesting'.). The ones I use to guide my own research only have a very few tiles (I have a low attention span). I post these more generic (and therefore more 'busy') ones in the hope that they provide some interest to a wider audience that just me.
So happy to accept feedback on ways to improve for 2021...
Take care and have a happy and prosper 2021.
greensiax
re Shearwater (LON:SWG), congratulations to Paul on finding any interesting company at all reporting today. One of my (no doubt useless) rules of thumb is that any company reporting in a holiday period has much to hide. However, there seems to be good justification for this particular update.
Like Paul, I am not sure of the business model here. The accounts show 30 million odd of revenue supported by 105 employees, and 23 million cost of sales. There is not much depreciation. That suggests to me a primarily VAR business, with teams of consultants putting in and supporting other people's software. Perfectly good business, but I would have thought limited operational gearing and a competitive sector - is there really mileage in their being a listed company? The loss-making track record is not encouraging, though they are forecasting better times in 2022 - the forward PER for 2022 is about 10.5. On the face of it, I would have thought a real software company like Intercede (LON:IGP) (I don't hold) was a better bet in this sector. Just my thoughts - obviously I don't know the company and I suspect management fancies its chances of making some good acquisitions.
I'm befuddled by the Brexit services deal. Take Gamma Communications (LON:GAMA) (I hold), which ,broadly, introduces companies to the cloud. It does a lot of business in Europe, and sees much potential there. It sells services there, so presumably is hampered in some way: but it operates through wholly owned subsiduaries, incorporated in the EU. 'Expertise' doubtless moves between companies, and no doubt they use common services in the cloud, but other than a reduction of chummyness, and some minor travel restrictions, I can't see any great problem - nothing to seriously damage growth or the bottom line. Can anyone enlighten me?
I work in financial services (asset management) and worked on our firm's Brexit solution so can only speak to the effect in my sector. You have hit the nail on the head in terms of how things operationally will be going forward (operating European subsidiaries which staff are seconded to). However establishing and maintaining these subsidiaries isn't cheap in financial services as most require a minimum level of substance for the subsidiary to get regulatory approval. There is also a big increase in red tape in operating in the EU. Previously we were only required to report to our home regulator and abide by their rules. Now as we are operating directly in EU member states, instead of through a passport on a cross border basis we have to report to those regulators and understand their rules.
These subsidiaries cost our firm about 10% of revenue to set up and the ongoing costs are not far off that. We only sell our products to professional investors, where there are lower regulatory hurdles (which means we can mostly rely on one EU subsidiary). If we were selling our products to retail investors the costs and impact would have been more significant - for example Italy requires a locally licenced entity.
For Gamma I suspect there may be more regulatory hurdles to jump over (possibly excluding them from specific nations) and these European subsidiaries will probably have to be beefed up going forward.
"I'm befuddled by the Brexit services deal"
That may be because there is no services deal. Very little has yet been decided and much rests on future decisions around equivalence. The long term biggest single benefit of the trade deal is probably the fact that it means the door is not yet closed on services, which has the bigger economic impact on the UK, and increasingly more so in the future.
For services generally, I think your previous reply from the asset manager is a good summary of the impact. My only disagreement with that comment is that I would say the seconded jobs wont last for long. Seconding people is expensive and employers will try to simply transfer the jobs to EU nationals as soon as possible.
But specifically, for companies like Gamma, I believe (without knowing enough to be sure) that decisions around data will also be important. The EU has agreed to a 4 month window, extendable by 2 months, where data can be exchanged as before. Should this agreement be terminated it would have a massive impact. Some companies might not have any choice but to operate illegaly for a period of time and hope for the best. You can't reorganise enterprise systems IT overnight. In many cases, the easiest solution would be to move all centralised data to the EU, as the UK has already said it will recognise EU standards. It would be a bit easier for those who are cloud based. I can't speak for Gamma but I have worked at some companies before who would definitely have problems if we can't strike some agreements in this area.
It looks as though work visas may be required for any work-reated visits beyond a conference or similar, and the individiual EU countries will have individual regulations. So a secondee may need a work Visa for each country they work in.
The penultimate piworld 2020 round up interview (7), with David Thornton, Editor, Growth Company Investor. Performance from low to high in 2020: +99%. Quite a rollercoaster! What went well: Tremor International (LON:TRMR) reaffirming that patience rewards & Codemasters Group (LON:CDM). Imimobile (LON:IMO) teaches, to remember why you originally bought into a stock. David is bullish for Venture Life (LON:VLG), in 2021, ‘forecasts are simply too low’.
Video & Podcast.
To watch all the other interviews in this piworld 2020 round-up series with various guests including Paul (Scott!), Stephen English, Leon Boros, John Rosier, Richard Leonard & Cockney Rebel, see here.
Tomorrow we have the final interview in the series, with Mark Slater.
Thanks so much Tamzin for these very useful interviews. May I suggest though by “leaking” the stocks the interviewees are recommending,you may reduce the number of people who will actually listen to the Podcasts? Perhaps not but just a thought .
Great work Tamzin, you certainly have been busy recently.
I have only managed to view about half of the them so far.
Yes the only mistake i made with £INRG is i didn't buy enough.
Great reply timarr, as usual. Let's face it, the Daily Telegraph isn't a serious newspaper.
It is one of the most analytical newspapers in the country.
You wanna try 'reading' The Daily Star !
Some huge moves today by stocks that has been commented on recently in this forum. An incredible move by bitcoin over the holiday saw it rise by well over 5000 dollars at one stage and bitcoin miner Argo Blockchain (LON:ARB) has stormed ahead.
Then the "green" stocks. These really are in vogue at the moment. Solid state battery maker Ilika (LON:IKA) has released a "caution" statement today after its shares have nearly trebled in value in a week and AFC Energy (AFC...Stocko still wants to put up Arsenal) is up over four fold in just over a month. This entire sector is soaring.
Finance newspaper CityAM reported today that the U.K. tech industry is now hiring at a faster rate and is leading the way in Europe. Venture capital investment in U.K. tech is at a recent high as innovation is moving at an extraordinarily level. Not far behind is the U.K. bio industry with the Astra Oxford vaccine being described by many as potentially the best around. The UK has jumped back to number 5 on the annual GDP list and analysts are predicting it will push well ahead of France and close the gap on both Japan and Germany.
Would others agree with me that growing evidence suggests the U.K. is potentially heading to one of its best periods of growth in history ...ignoring Covid, politics, Brexit and all? In history, these periods often seem to come out of nowhere. Very exciting times ahead for our youngsters I think despite all the gloom and doom around.....and of course for the UK stock market!
Hi Peter,
Any "green" stocks you recommend looking into? Everything I've seen looks ridiculously overvalued
An interesting green stock that is not yet overvalued, in my opinion, is Smart Metering Systems (LON:SMS). It has a growing annuity revenue stream from its installed base of smart meters which supports a yield of ~3.8% alongside a commitment to grow the dividend by 10% per annum for the next 4 years. They are currently developing “CARE” assets such as battery storage which should add significant value to the defensive core business. From memory, the house broker has a sum of parts valuation at around 1200p versus a current share price of ~700p.
I hold but one to DYOR on I would suggest.
Cheers
Simon
joshwood...yes after such a strong rally it is now getting tough to find real value. Almost every day they dominate the risers board. I suspect some of these stocks will go much higher yet but having bought AFC at 16p via a primary bid placing for instance I for one would struggle to pay nearly 90p to add.
I would not recommend anything but I do have a strong holding in Velocys (LON:VLS) High risk though and a long term stock that will need plenty of funding. "The UK Government established a newly formed Jet Zero Council and invited Velocys to become a founding member" takes the eye. The Government is very keen on this technology and the company also has support from Shell....but like many of these "green" stocks there is a lot of hope involved. The winners may well become the multi billion companies of the next decade but which ones to choose to invest in? The US rates such stocks much higher and will fund them accordingly of course. With hindsight it will be "obvious" who we should all have bought!
May I suggest one EV potential play is £HZM - SP has increased albeit not to sky high price. It's a nickel play. The first mine is ferro-nickel (i.e. for stainless steel). It's the 2nd mine which is a nickel mine they bought from Vale a few years back on the super cheap - this is the potential EV play. A few years away from production but from my research - it is pretty much on. I hold.
In the longer term hopefully we will put the worst of the pandemic behind us, but I think some areas e.g . retail will be slower to come back to life. The longer winter months, and the new virus spread, and the inevitable stop/starts of the lockdowns &Tier restrictions means I suspect Moley will be a little more cautious out of his hibernation than in prior years.
Always makes me laugh, people say “oh, this outcome never happened therefore we shouldn’t have bothered taking precautions”.
Which is a bit like saying, roads deaths have fallen massively, we didn’t need to bother wearing our seatbelts.
Hi Paul,
Newish member of Stockopedia here. Firstly, i'd like to thank you for your daily blogs. They are very insightful and more than anything help me understand what to look for when analyzing a stock.
More specifically, have you come across any good EV/Clean energy plays? I am currently in an ETF that is exposed to this sector but i'd also like exposure to an individual company but everything i've seen Eqtec (LON:EQT) etc seem to be priced at ridiculous valuations.
Thanks once again and happy holidays!
Josh
Not what you asked for I know, but in October I bought £INRG the iShares Global Clean Energy UCITS ETF. There has barely been a day since that it has not risen. With the election of Joe Biden, I think this sector has a lot further to go.
Yep that's the ETF i bought into :)
Agreed and appreciate whoever pointed me towards it first on this forum. Only wish that I had bought more
Thg Holdings (LON:THG) bought Dermstore from Target for $350m which is 1.8x 12 month forward revenue.
This is a bold move to get into a cosmetic and beauty market worth easily over $10bn with only two main competitors - Sephora and Ulta Beauty.
Both Sephora and Ulta turnover several billions in the US and both have websites similar to Thg Holdings (LON:THG) 's existing online brands Lookfantastic and GlossyBox which are strong online cosmetic brands in Europe and growing strongly in Asia. Dermstore's website looks plain and outdated in comparison, but has grown users this year from roughly 4m to 6m and I imagine THG will have plans to make the website much more exciting and in a similar style to Lookfantastic.
Sounds like a promising acquisition to move into a very big, and growing, market. Share price is up over 5.5% as of writing.
Interesting. Foothold in the US to build up a similar ecommerce infrastructure there as they do have in the UK?
Seems like it, the Thg Holdings (LON:THG) distribution and warehousing is only small compared to Europe with over 3 mill sq ft in Europe and only around 300k sq ft in the US so, there is a lot of room for them to grow in the US which is such a huge market but the online cosmetic market is largely untapped.
I think the existing online presence of competitors there isn't that great either, so I think Thg Holdings (LON:THG) could do well and take market share.
Please stop pumping THG every day. It's getting boring now.
It was a news update on an acquisition actually. If you're not interested keep scrolling because others are.
I have never 'pumped' it, I just discuss news on it. Are you really naive enough to think the investors here can move the market?
couldn’t agree more with IGPJ - I had a good look at THG a couple of weeks ago when you talked about it first - it ain’t for me.
Think you might have a lot of good stuff in there Thornabian and I definitely want to hear it - the stuff between you and mojo was enlightening for me last week. But THG looks like a very pumped stock to me - I’ll look again at next news update only...
Agree with covid comments. reporting from newspapers has lacked context since early on, mostly due to government and sage doing same with policy action/recommendations
"Don't Betray our Children" is the front page headline in the Daily Mail. What will be their headline if the hospitals are overwhelmed? The Government can only have one primary objective......protecting the NHS or keeping open schools.
Schools are obviously the spreaders, just look at the numbers since Sept. They should not open unless they all have mass testing every week or everyone is vaccinated.
Otherwise, we just continue in these perpetual lockdowns.
the short term investment problem with keeping the younger kids off school (other than their mental health, loss of longer term ability for our future workforce, drop in grades for a generation) is that someone of usually working age needs to mostly sit around doing nothing much useful in order to supervise them, so a massive kill to working productivity - which impacts almost all industries.
So is lockdown and higher tier after lockdown and higher tier. We have shut about 15% of the economy. Most parents can work from home or find someone to look after children.
I agree for the most part with the exception of the drop in grades. The grades are always bell curved each year (if the paper is harder the grade boundaries just drop). Last year was an exception (CAG grades) in that grades were higher than historical, precisely because a bell curve couldn't be applied following the collapse of the algorithm. This year there is talk of "marking more generously" from the government but of course this will just lift all boats in the harbour (to use a stock market adage) and again the bell curve will be applied (unless we have the algorithm/CAG grade situation again). Full disclosure, I am a secondary teacher (career changed from engineering a decade ago).
Maybe I should have been more specific but I was referring solely to secondary school, not primary.
As a teacher do you think online teaching doesn't work for secondary school - particularly GCSE and A-level years - as they are the main spreaders between households.
It just seems obvious to me.
Its a difficult one. The technology is there to provide an online teaching facility that wasn't there a decade or two ago. Live lessons is an option but feedback from many was that pupils couldn't manage this (perhaps multiple siblings sharing resources at home, perhaps those without adequate broadband/IT equipment or other reasons). I think what many underestimate is the difficulty of the teaching job itself - just providing resources and letting pupils get on with it at a time of their choosing doesn't work either. Pupils need motivating, supporting, scaffolding, chasing , reminders, encouragement etc....it is quite a mentally and physically exhausting job hence the teacher shortages (as I say I have done many jobs in the private sector too). Couple that with busy working parents, some of whom view the education of their children as something they have outsourced to schools entirely and you end up with much lower pupil engagement in lockdowns. Only the most independent (minority) seemed to thrive last time in my experience (I include A level in this). I have mixed feelings of course because I do feel schools contribute to spread and government support has been pitiful. It would be quite nice to see my parents at some point (working in school doesn't really permit this for me) but I guess this applies to many of us.
Completely agree and priority would be for certain years but it would be temporary until they can give schools the resources to identify and tackle the virus. Just letting a free-for-all with no resources to quickly identify if someone has it is just a recipe for disaster.
School kids and their parents are at almost zero risk plus (if my kids school is representative) a good 50% have already had it. Education is so important and simply doesn't work outside the school environment for the large majority. All focus needs to be on protecting the vulnerable until they have had their jabs.
Too true. The Telegraph article Paul quotes is misleading: first, road deaths are spread throughout the year, whereas Covid comes in waves - and the health services are not sufficiently resourced to cope with the peaks. Secondly, the danger of covid is mostly not just to the elderly, but also to those with pre-existing conditions, yet the article only refers to those with no underlying health conditions. Covid is not just about deaths, but for some the enduring, disabling after-effects (long covid).
We've had almost a year of Covid, so annual comparison is not misleading at all. There's probably seasonal variation in road deaths, but it doesn't mean the annual figure is misleading.
But we have not had Covid in January and February yet which is also the flu peak time, so that could well affect the annual figures.
still, I don’t think that’s what the article signifies. As Paul said, it breaks rank from the standard “COVID is terrible” to the new reality “COVID is terrible for old people”. If we can vaccinate old and vulnerable people, then we can get back to business as normal.
I fully expect to see many articles like this over the next few weeks. If you have spent 9 months convincing people of an abstract terror, it only makes sense you should spend a month or two convincing them that it actually isn’t that scary actually. Especially if you are going to ask them to get back to work in February. Very difficult needle for the government to thread - too early and virus spreads and too late and it costs money for a few months - remember Rishi is up in March, that’s the cutoff for the new plan.
Will be very interesting to watch...
Children, students and young people have already made massive sacrifices for nearly a year of their lives (and a year for a young person seems a lot longer than it does for old gits like me and I imagine, most of us on this board lucky enough to spend our time investing money).
Closing schools is unnecessary and results in far more problems than it solves. If it came to a choice - which it shouldn’t given the (relevant) facts - it would be better to lock down those at greatest risk of severe illness or death as a direct result of coronavirus and let young people live fuller lives again.
While I agree it would be better to lockdown those at risk, it doesn't work because 14-18 year olds are the biggest spreaders between households because they get it from schools and take it home but they are old enough to do online learning. The two weeks before London went in to tier 4 half of the schools in East London were shut anyway due to outbreaks of Covid. Those who think just letting things stay open will solve the problem are not looking at the fact that everyone gets it and it closes anyway.
Look at Australia, they are completely open again after tackling it the right way first time. This half assed attempt at measures but not tackling the true transmitter between households has failed time and time again and it has been the approach across Europe where they were saying back in May/June that schools don't transmit it, but look at what has happened since September.
Two lockdowns, two waves, higher tiers which have also had to be strengthened.
could not agree more with you Paul re the U.K.,although things look rather different here in South Africa . Cases rising very quickly with a higher proportion of the young affected than in most other countries . President last night, amongst other restrictions,made it mandatory for everyone to wear face masks in public,with 6 months jail for those not complying. Imagine trying to impose that in the U.K. !! Sale of alcohol banned once more and a 9pm to 6am curfew. Unfortunately here,it’s highly unlikely any vaccines will be available until July.
But I shall continue to support local charities whilst filling my boots with shares such as Boohoo ;)
Cheers and all the best for 2021
Thank you Paul for highlighting the Telegraph article (not normally my favourite paper) but could too MSM giving a counter argument to the current orthodoxy.
The Daily Mail has been providing facts and figures similar to those in The Telegraph for months now. They’ve also frequently pointed out that while there is so much focus on covid, cancelled and delayed diagnosis and treatments for other life threatening illnesses, including cancer, have caused and will continue to cause, far higher unnecessary deaths from that neglect. And they’ve suggested that the NHS should be renamed “The National Covid Service.”.
The Mail has also pointed out how way out forecasts from the scientists the Government have relied on throughout the pandemic have been both during it and in previous epidemics like SARS where they way over egged the likely impact. Neil Ferguson in particular has been very wrong time and time again.
I’m no fan of the Mail (we’re Times subscribers) but on covid they have been very good throughout. In our area and quite likely over much of the Country it is almost impossible to see a GP, such is the emphasis on covid alone.
There is though a worrying aspect to the new strain and that’s that (as happened with Spanish flu) there are signs that this is hitting the healthy young far more seriously.
Niall Ferguson in particular has been very wrong time and time again.
Assuming you mean Neil Ferguson, the latest research from the BMJ suggests that the Imperial modelling which triggered the first lockdown was tracking CV-19 deaths pretty accurately:
With hindsight, the Imperial model has proved remarkably accurate. It turned out that the experts really are expert.
https://www.bmj.com/content/37...
The black curve is actual deaths, the dashed lines are the predictions around various R rates and countermeasures that the Imperial model came up with. Given how little data they had when this was published that's pretty remarkable.
As you can see from the second graph, the model also predicted the second wave although as it didn't include either tiering or the mutant version of the virus the original predictions it made will get progressively less accurate.
Both the Mail and the Telegraph have repeatedly attacked the Imperial model and Ferguson because essentially they represent the science behind the lockdown. If you can undermine that you can undermine the basis for the restrictions. As both of those papers are controlled by business interests which are largely funded by rentier incomes, which have been badly affected by the economic restrictions, we ought to take anything they say with a large pinch of salt.
That doesn't mean they can't be correct, but we can't simply take their word for anything. Look for the research, not the headlines.
In terms of the impact on other health services, that's undoubtedly correct. But I don't remember the Mail protesting when austerity measures meant the NHS was underfunded for the decade before the pandemic.
timarr
Ferguson and Imperial predicted 4000 deaths per day. Even the US hasn't got near that and they had much less restrictions, they have never closed outside pubs, restaurants or bars.
The newspapers aren't reporting that we should also care about the economy because they have financial interests, it is because we should also care about the economy.
With that said, I don't agree with the 'anything goes' approach and personally I think there has been a clear failure to actually tackle the true sources of transmission between households.
'Following the science' either hasn't happened or it has and it has not worked - I suspect a bit of both over the last year.
Which begs another question of following which science, Oxford university epidemiologists don't agree with Ferguson or Imperial but only Imperial is in Sage.
Other than a vaccine coming through, it has all been a shambles.
Which begs another question of following which science, Cambridge university epidemiologists don't agree with Ferguson or Imperial but only Imperial is in Sage.
This is just plain rubbish. I have a friend who is a Professor at Cambridge University whose colleague is on Sage along with two others, one of whom is Prof. David Spiegelhalter whose excellent book on statistics I am currently reading. There are also 3 members from Imperial, including Niall Ferguson. This is such an easy fact to check that I'm not sure I can take anything else you say seriously.
Si
I got the university wrong, I was actually meant to say Oxford - epidemiologist Sunetra Gupta and team, who have not been invited to Sage despite having a very different view to Ferguson.
That is a smaller point in the wider argument which is that Sage have failed miserably. That is really quite obvious because even when they have said they should have toughened measures earlier on and subsequently increased them, it still didn't work. Their approach is all wrong and has failed consecutively.
I got the university wrong, I was actually meant to say Oxford - epidemiologist Sunetra Gupta and team, who have not been invited to Sage despite having a very different view to Ferguson.
So one person whose views confirm your own views is not on Sage? There are actually five members of Sage from Oxford University, so I assume they are just the ones that you don't agree with?
That is a smaller point in the wider argument which is that Sage have failed miserably.
Another ridiculous assertion. The truth is never a small point!!! Although I realise that facts and the truth is somewhat out of fashion these days, they still work for me.
I read a paper by Professor Julia Gog of Cambridge (a member of Sage) at the very start of the pandemic and she predicted exactly was has happened i.e. that there would be multiple waves and a series of rolling lockdowns.
Si
Ad Hominem to hide that you have no argument.
Your Cambridge paper was right because they were the ones advising the Govt. Shame we didn't have the advisors that Australia had.........
Ad Hominem to hide that you have no argument.
Yes, how inconvenient of me to hide behind facts instead of lies! Facts that you could easily have checked but did not. If you can't make simple checks on the members of Sage, which is publicly available information, then you have no credibility in my book, and as such I certainly won't be paying any attention to your future posts.
Si
What facts? What fact have you stated? That it was Cambridge and not Oxford? It was a slip in my writing but makes absolutely no difference to the point of differing scientific opinions, Cambridge is not more prestigious than Oxford.
I see you feel the need to be pedantic and grandstand though so please don't read my comments if you feel that way.
Don't even know why I'm wasting time responding to such nonsense!
Thornabian
The Imperial predictions of high deaths were of what would happen if no action was taken. As the graphs in timarr's posting show, that prediction looks reasonable. Fortunately, action was taken, the lockdown caused the first wave to flatten and the Summer weather then reduced the R.
As I said, US virtually took no action, have a population much larger than ours and it is still yet to see 4,000 deaths per day. Therefore, their modelling is clearly completely inaccurate.
But they don't count all the Covid deaths, look at their excess death figures.
The USA is a large country so it is having peaks at different times. New York was very bad at one time but other states were not so it is more evened out than a small country such as the UK.
Compared England with New York state.
The UK doesn't count all excess deaths either because not all excess deaths are due to covid.
It is still missing the point, the US is 5 times the population size of the UK and has not had 4,000 deaths but didn't have any of the measures or lockdowns we had. They closed indoor dining and some wear masks and that is about it.
How can anyone possibly take Imperial's prediction seriously? 4,000 deaths per day, it is ridiculous and so inaccurate.
They haven't controlled the virus and their models are wrong.
That's higly debatable. As has been stated the 4000 was on the assumption of no steps taken. And that clearly is not the case here, or in the US. Action in the US has been patchy, but places like NY have had hardly any indoor dining out since March, and had schools chut most of the year. Trump rallies may have failed to take any action, but that doesn't mean others haven't. Wearing masks is pretty effective, as is stopping indoor dining and drinking. You certainly cannot say the prediction is ridiculous unless you assume that all the actions taken have had next to no effect, which is itself ridiculous.
How do you tie that with the fact their population is 5 times the size of ours, most states have had next to no measures and the strictest was NY and California where they only closed indoor dining and had some online learning?
Either online learning is the biggest contributor to stopping household transmission (my argument also) or all measures do next to nothing, the 4000 per day number of no measures was completely wrong and the natural rate of deaths tops out at the rate it has in both countries?
Either way you go down that divide, the modelling is wrong in the UK or the measures have had little affect because with no measures we should see roughly 5 times less deaths than the US - give or take for population density and other social factors. (UK is roughly seeing 600 deaths per day vs 3500 per day in US)
Or both the UK modelling was wrong and the measures of locking down and opening with schools being open is doing nothing? Which is my argument.
Yet New State has a death rate of 1,929 per million, population is 19m.
The US and UK have similar recorded death rates around 1,000 per million although we had Covid before most of the US did. We are much more densely populated than USA, even England is about the same size as New York State yet the population is around x3 times NYS.
New York did have a lockdown in March and April: "
You are wrong the US did have lockdowns, especially in New York.
4,000 deaths is quite possible in the UK if we did nothing. It won't just be Covid deaths either, it will be others who can't get treatment.
Is it not best to keep as many people alive, until they can have the vaccine, now we know there is one coming soon.
This is all relating to the time since September when the 4000 per day model was used to introduce our second lockdown and say it would otherwise be worse than the first, so I am not wrong, and NY hasn't been in lockdown since then.
New York is considering going into another lockdown.
Hospital admissions for Covid patients in the UK, is now exceeding the first wave, even with better medicines to combat Covid. I think it is too early to say it is not worse.
4,000 is one model and that is the worst case scenario.
"Sage, found that admissions could surpass those in the first wave by the end of November, with the death rate hitting 800 per day a week later. With no further action, hospital bed capacity would be overrun in December."
Sage advise looks plausible, as we are around those figures now but a month later due to lockdown. Admissions are exceeding the first wave and we had nearly 800 deaths a while ago.
You are wrong! We are now at a point where hospitalisations are level with or exceeding the first wave. And it's false to say NY hasn't had lockdowns since Sept. Restaurants were never able to have more than 25% capacity inside, and I believe are now closed, indoors, again. Many/most of the schools are either shut of have been for extensive periods. Columbia hasn't had any in person teaching for undergrads since March, it's via zoom or similar - and that's a pattern widely followed across the US. True some states haven't followed lockdowns as tightly, but you get a false impression from UK news coverage, as it tends to cover the news of Trump rallies and anti mask protests, and ignores the reality for most in the heavily populated areas on the ground. In fact the impression I get it that is far more mask wearing out of doors in the US than the UK in general, and it's compulsory in some places, unlike here.
That's exactly what I said, schools are the transmission.
UK is all wrong.
The point is the UK excess deaths are pretty close to the reported number of Covid deaths but they are not close in the USA, excess deaths are much higher than the reported Covid deaths, probably because some states are only counting hospital Covid ones.
The latest figures from 7th November, I have are for USA were Covid deaths 233,093 and excess deaths 310,576. UK figures were up to 13th November were 66,793 Covid and 72,878 excess deaths.
But some other countries are much worse, for example Ecuador the excess deaths 3x the reported Covid ones. Mexico they are over double, Peru over 2x, Portugal are over 2x and even Spain they are over 50% higher. Makes comparing reported Covid deaths between countries difficult.
That needs to be assessed per population (lets just assume the UK difference would be 5 times more for simplicity) so 30k vs US 76k, and yes the US is more but it is not 7 times more which is the claim made with the 4000 deaths per day Imperial College model, in the UK, if we didn't have a lockdown.
It just doesn't add up. The idea lockdowns are effective has clearly not passed the test. The week before the second lockdown in England, the mobility readings increased across the country by over 10% because the models from Imperial College scientists don't accurately account for social behaviour and responses to their measures.
They are just guessing what will bring R down.
ps. the logarithmic scale on that cumulative graph is so squashed and dates all the way back to the start of the crisis in March so it is impossible to determine if they are right, the only thing which is clear from that graph is their 'do nothing' line (scenario) is completely wrong to what happened.
If you want to compare measures, you either use different time-series of when the measures were taken or you use several linear scaled graphs.
This graph from Imperial also says that closing schools (PC) would have virtually no effect. How can that possibly be when so many of them are closed due to Covid and those secondary students have parents in their 50s and 60s who are at risk of hospitalisation (although probably not death)?
They put household quarantine (HQ) and case isolation (CI) as the two biggest factors but both have failed time and time again because schools are open so it is impossible to truly close off transmission to those households.
Repeat the same mistakes, over and over.
Ferguson has a history of making flawed exaggerated forecasts. The science is nowhere near settled and still very contentious. Appeals to authority of BMJ do not wash. Other studies have shown different results. Ferguson et. al. might be right but jury is still out. Yes impact on health service is correct but so far it has been no worse than a bad flu year. That shows the lack of investment in the NHS rather than unique effects of COVID. We knew 2nd wave was coming but did little to prepare for it - Nightingale hospitals have been closed down due to lack of staff. In terms of markets which is why we are here I see the picture improving once we are over this bleak period as long as vaccine works and is rolled out quickly.
The science is nowhere near settled and still very contentious. Appeals to authority of BMJ do not wash. Other studies have shown different results.
Which other studies?
But the one quoted is simply showing that the actual mortality rate has closely tracked the predictions of the Imperial model. It's not an appeal to authority, just a review of the data.
As to your other points, I'd agree. We also have to remember that flu cases are probably signficantly down because the measures taken to protect against CV-19 also reduce that - the Australian flu numbers were 90% down this year.
There's no simple truth, it's messy and complicated. It'll be years before we get any real understanding of what's happened.
timarr
The Imperial report specifically stated that it did not take into account any economic, social or financial consequences . It also said that whilst lockdowns work , as soon as the lockdown is lifted infections will rise again, nor did the Imperial report estimate the number of deaths caused by lockdown, cancer/pneumonia patients not being treated etc.
The economic cost may well cost us many, many more lives in the future. We may just have to learn to live with Covid 19, and probably Covid 20,21 and 24.
The economic cost may well cost us many, many more lives in the future. We may just have to learn to live with Covid 19, and probably Covid 20,21 and 24.
It may, and perhaps probably wiil. But the fact that there's a is strong correlation between those countries that contolled the virus well and those that have suffered least economic hit (and the reverse - where the UK comes out near the top in both categories), suggests that the notion that economic vs health costs is a trade off is a false one.
Not sure that is true.......look at Jersey. It had very few cases initially, tested everyone entering the country, very severe lockdown, but recently 3% of the population was infected at one time.
The scientists' projections for Covid were NOT forecasts, they were the results of modelling based on a set of assumptions about what could happen if nothing was done. The aim of such modelling and projections is to inform decision making and help ensure the right actions are taken to minimise the chance that such projections do happen. The fact that something was done automatically means the projections don't happen.
But I guess "Scientists identify actions required through modelling, government implements some of the recommended actions and therefore many potential infections/deaths avoided." doesn't make such good copy.
"The scientists' projections for Covid were NOT forecasts, they were the results of modelling based on a set of assumptions about what could happen if nothing was done."
Literally "Soothsayers" examining the entrails of dead organisms... and sacrificing the lives and welfare of others before their own created idols.
We are no different to 2,000 years ago, its just our Abacuses have been upgraded.
I think you need to check the definition of "literally" in a dictionary.
As time goes on we are hearing more about those whose survived getting Covid but are left with long lasting symptoms - so called long Covid. So, any analysis that focuses on deaths as the only health impact is rather narrowly focused in my view. (And of course there’s other impacts as treatment of other diseases is delayed). But I’m all for putting the risks in context (and perhaps a better understanding of risk will help those nervous about being vaccinated realise the relative risk is likely to be very low indeed and they take far more risk just by driving a car).
As far as the Brexit deal is concerned it sounds good for goods but unclear for services, so logically that suggests service companies who have significant business with the EU may underperform. However, sentiment may override that.
That’s a fair point but equally there are a lot of people in car crashes who don’t die but experience life changing injuries and long term effects.
I'm sorry to be downbeat when there is positive news about. I know we all need a break. But just before Christmas it was announced that a new mutation from South Africa had been imported to the UK. The new strain is far more transmissible (like our new strain) but more worrying is the fact that it appears to attack young/old/sick/healthy more equally.
https://www.bbc.co.uk/news/uk-...
When Hancock did his last press conference before Christmas he sounded extremely concerned about this new strain and said it was the head scientists' major focus. There was also a mention that it has a large number of mutations (suggesting there is a possibility that the virus might be less effective).
This isn't my area of expertise (do I have one?) and I'm not sure if this news has been discussed at length already - so apologies if it has.
I'd be interested to know what others more clued up think....
Every time the virus is passed on it has the potential to mutate. If we circulate it freely in an attempt to live with it or build herd immunity then there is much more opportunity for mutations to appear.
If one of those variants spreads widely before people are vaccinated or one of them is not caught by the vaccines then the cost of not suppressing the initial spread will be very high indeed.
How lucky do you all feel?
"Every time the virus is passed on it has the potential to mutate. If we circulate it freely in an attempt to live with it or build herd immunity then there is much more opportunity for mutations to appear. "
A naturally occurring phenomenon, Darwinistic, which has been going on for billions of years across The Universe.
Mutations are how organisms evolve. The same process shows how rabbits still exist after the widespread release of "myxomatosis". Eventually the organism adapts and gains immunity and new strength.
Its natural.
You might as well be arguing "save the dinosaurs", "more wolves in Surrey", "5 MPH Speed Limit" or go full "Extinction Rebellion" and turn off the economy.
You miss the point, UK_I. Of course mutations are a naturally occuring phenomenon. But we all know that a variery of things affects their frequency, one clearly is radiation - and not really relevant here, but the other is size of population and frequency of reproduction. The higher the population of a virus the more chance of a damaging mutation - more infective or more lethal. If those are "successful" as the current variuent clearly is - as it spreads more easily - then the mutation will spread and become dominant.
The more you control the baseline infection rate then the smaller the population and the fewer chances of a dangerous mutation taking place. If you keep infection rates to a minimum like Taiwan and NZ then there is far less likely to be a mutation than if you have 200 or so per 100000 like the UK
The more you control the baseline infection rate then the smaller the population and the fewer chances of a dangerous mutation taking place.
And, of course, natural selection dictates that if you squeeze down the resources available to the virus - say through lockdown denying it new victims - then any variant that has a small advantage - say in being more transmissable - will start to dominate the remaining population.
If you then suddenly resupply the virus with resources - say by encouraging everyone to go on holiday to Spain on planes and to get together in restaurants on Mondays, Tuesdays and Wednesdays - then you give the new variant rocket fuel.
Truly, we are led by donkeys.
timarr
So UK-I, are you saying we shouldn't do anything to ensure our own survival because the Universe doesn't care? Just let the virus run it's course? That could certainly be a contender for a Darwin award if there's anyone left to award it.
Completely agree. It’s almost as if people thought you had to have permission from the EU to do any trade.
I read analysis by a barrister last night who stated strongly that there are no hidden problems in the deal.
The deal has been out long enough for pundits and critics to make ‘bombshell’ revelations if there were any, instead the tumbleweeds roll on!
Completely agree. It’s almost as if people thought you had to have permission from the EU to do any trade.
Well clearly you do if you want to trade with the EU tariff free, just as you do with the UK. That's why we have trade deals
Just 388 people under the age of 60 with no underlying health conditions have died of coronavirus in England, NHS data has revealed....
We know this, it's not a secret. In fact the average age of people dying of CV-19 is slightly above the average lifespan.
What the Telegraph headline doesn't mention is that there are 20 million people in the UK either over 60 or with underlying health conditions who are at heightened risk from CV-19. I'd imagine most of the Telegraph's readers are in that group, which makes you wonder who they're writing for, really.
And, of course, you don't have to be vulnerable to be taking up a hospital bed with CV-19. In the words of the aforementioned Daily Telegraph, from two days ago:
There were 18,227 English hospital beds occupied by coronavirus patients, the highest figure since daily records started in August
Could the UK have done better? Damn right it could. Look at Taiwan, which has seen its economy grow this year. It didn't try to control the virus, it went for full suppression. Of course, Taiwan has the natural advantage of being an island, and able to contol its borders.
As for shares - absolutely agree. From here you'd expect an elasticated rebound as we get a twin boost from reopening the economy towards the end of Q1 and general relief at some certainty around Brexit. Added to the continued willingness of governments to pour money into the economy and near zero interest rates it's hard to imagine how markets won't rise.
Of course, we might have said something similar this time last year :-)
timarr
with record population on the curve between norwich, nottingham, oxford and bournemouth ie the south east is it really a suprise of record emergency call outs? no one is on holiday or has really moved out of the south east due to tier 4, say, 1-2 million people more than last year?
Excellent point David. The figure I heard was that 3m more people were in the UK over Christmas than normal.
That must be a boost for the UK economy of say £30bn assuming they spend a net £1000 per head in the UK more than last year ?
"We know this, it's not a secret."
I would be amazed if the average person knows this.
Much like when you ask the average person what proportion of the UK comprises people not born here: also not a secret, but widely misjudged.
The problem is many adults in the U.K. do have underlying health issues, around 26% of adults have hypertension and around 7% have diabetes. How many under 60s don’t have an underlying health condition?
It seems to be a classic case of using statistics to support an argument. 388 obviously isn't a large number in the context of the tens of thousands who have died, however, it ignores a number of important points.
Firstly, the nature of 'underlying health conditions' apparently include sleep disorders, arthritis, glaucoma, migraine, and broken right forearm. Clearly, nothing to do with the lungs or ability to deal with Covid. So what would the 388 number be if only the health conditions that made them vulnerable to Covid were considered?
Next, the question of 60. Why 60? It's not that old, I would imagine many readers here are over that age, and certainly, most of the population at that age are still working, productive members of society. I would suggest even 70 is not that old in this day and age. I wonder what the 388 number would be if this arbitrary age threshold was raised, even modestly?
Does separating those with underlying conditions from those without, and younger from older people suggest that some lives more valuable than others?
And then there's the simple observation that regardless of who is filling hospital beds, the hospitals are struggling. And that then starts to impact anyone who might need a bed, whatever their age and however unfortunate their accident or condition.
It seems to be a classic case of using statistics to support an argument. 388 obviously isn't a large number in the context of the tens of thousands who have died, however, it ignores a number of important points.
Hans Rosling's last book, Factfulness, talks about this in the context of something he calls the Size Instinct. There are a couple of relevant quotes from the chapter:
"It is pretty much a journalist's professional duty to make any given event, fact or number sound more important than it is".
"The most important thing you can do to avoid misjudging something's importance is to avoid lonely numbers. Never, ever, leave a number by itself. Never believe that one number on its own can be meaningful. If you are offered one number, always ask for at least one more. Something to compare it with".
Interestingly Rosling saw this usually in the context of exaggerating the importance of big numbers. I don't think he ever anticipated media outlets trying to minimise the impact of personal suffering in order to prioritise business interests.
timarr
Apart from Rosling’s excellent lonely number advice the other advice I have always valued is to change fractions to percentages and, whatever measurement you use, ALWAYS invert.
So if a breathless media pronouncement says that “1 in 5 people are at serious risk of ....” remember that it means that 80% of people are NOT at serious risk.
Agree entirely timarr but I'd just to point out that Great Britain is an island and is able to control its borders - just like Taiwan.
I assumed he was being sarcastic!
You're probably right and the thought did cross my mind :-)
It has not helped Jersey, which from hardly having any infections and strict testing on entry, a strict lockdown enforced by uniforms knocking on the door at any time of day and night recently had or has 3% of it's population infected.
"Could the UK have done better? Damn right it could. Look at Taiwan, which has seen its economy grow this year. It didn't try to control the virus, it went for full suppression. Of course, Taiwan has the natural advantage of being an island, and able to contol its borders."
With all due respect, Taiwan is a different culture, semi-militarised, not European.
The breadth of wide opinion shown on this board, wouldn't be possible there!
What would you have the authorities do? Have a Police shoot to kill policy, or ship lockdown transgressors to a hopeless penal colony such as Scotland?
Hi Paul
There also appears to be no conflict about the Brexit deal. Both U.K. and EU appear quite relaxed and even pleased about the deal.
The prospect of 2021 without constant threats of ‘cliff edges’ etc will make the investment environment far more positive for domestic and international investors. Even Bloomberg, who have thrived on Brexit apocalyptic negativity are struggling to keep it going....but they are still trying :-)
Martin
Good point Martin. Although how many people really believed that the EU would intentionally put up restrictions to selling stuff in its most important export market? It never passed the common sense test to me, hence why I wasn't worried about it.
I don't want to express an opinion on the EU/UK deal, because I haven't read the fine print yet. But the fact that nobody's kicking up a stink about it, suggests it's possibly a reasonable compromise? Also there seem a lot of loose ends yet to be agreed, so perhaps it's a first step, to keep physical goods flowing, whilst everything else gets negotiated in future?
Regards, Paul.
Yes, even on the fishing issue, our fishermen are complaining about it not being good enough, the French fishermen are demanding talks with their government about what they are giving up and the Irish are saying they will need to be compensated by the EU because the deal is so bad to them! It sound to me as if it could be a balanced deal!
Balanced in that everyone dislikes it equally? ;-)
Hi Paul
My impression and it could be wrong the deal only covers agriculture and manufacturing. Service and finance sectors are not in the agreement. No doubt it will be spun to teach financiers a lesson but there is more to financing then those pesky bankers.
My impression and it could be wrong the deal only covers agriculture and manufacturing. Service and finance sectors are not in the agreement.
That's correct. While there's understandable relief that a deal has been done and businesses now have some certainty we shouldn't get carried away - this is the first trade deal in history that's raised trade barriers rather than removed them.
timarr
Absolutely Paul, this deal is just the beginning. We will be negotiating trade related matters with the EU for decades. This deal mainly deals with physical goods and, as we know, the UK has a deficit in goods trade with the EU. The area where we have the surplus is in services, which are still up for negotiation.
It's a bit early for people to spot many problems with the deal but I think there will be quite a stink over fish.
This podcast from the Institute for Government gives an early view of what the deal looks like:
INSIDE BRIEFING with Institute for Government - IFG LIVE SPECIAL The Brexit deal: An IfG briefing (google.com)
My morning smallcap tweet: Atlas still looking for map out of merde
Atlas Mara (LON:ATMA) Remote Monitored Systems (LON:RMS) Abingdon Health (LON:ABDX) Shearwater (LON:SWG) Myhealthchecked (LON:MHC)
Atlas Mara (ATMA) new secured facility agreement and a standstill agreement with certain creditors. "While the Company has made significant progress in asset disposals as previously announced, and continues to explore other potential transactions, the economic challenges related to the COVID-19 pandemic resulted in delays in the strategic fundraising initiative, which was paused as a result of tightening global liquidity. Further compounding these challenges, the major currency depreciations across the African markets in which the Group operates resulted in a more than $150m reduction in assets." [SP=0.38 Cap=68m]
Remote Monitored Systems (RMS) delays in Pharm 2 Farm's new production line, mask certification. [SP=1.33 Cap=26m]
Abingdon Health (ABDX) still no approval for home use and self-test of its covid test. [SP=95.6 Cap=93m]
Shearwater (SWG) Oct & Nov rev up 39%. Guides FY profit in line. Two 3 year contract wins and two 1 year renewals worth £860k tot. [SP=140 Cap=33m]
MyHealthChecked (MHC) gets on gov't COVID-19 private testing providers list for General Testing, and the Test to Release for International Travel. [SP=1.57 Cap=8m]