Good morning, it's Paul here with the SCVR for Wednesday.

Timing - I've started early again today, so should be mostly done by 1pm. Today's report is now finished.

Agenda -

Headlam (LON:HEAD) - operational update - business as usual

Topps Tiles (LON:TPT) - Q1 (13 wks to 26 Dec 2020) trading update

Clipper Logistics (LON:CLG) - slightly confusing trading update


US Senate Elections

I was up most of the night following the US Senate elections in Georgia, because that could be important for the US market, determining whether President Biden is able to push through massive stimulus & infrastructure programs, and tax rises for companies & the wealthy. Or whether a Republican Senate could block or tame his policies. Opinion seemed to be divided amongst US commentators, on which outcome would be good for the economy and stock markets, so I ended up retiring rather confused.

Monthly GDP - UK

Whilst browsing the ONS website last night, waiting for something to happen in America, I happened to come across an interesting graph (see below) re UK GDP, measured monthly. This runs from Jan 2007 to Oct 2020.

You can see the first dip for the financial crisis from mid-2008 to mid-2009. Compare that with the unprecedented stoppage of the economy due to covid/lockdown 1, in early 2020, with a massive plunge down in GDP, with about a quarter of GDP vanishing from high to low.



However, the graph then more recently clearly shows a V-shaped recovery in GDP. It wasn't all the way back up by end Oct 2020 (where the data runs out), but it had recovered most of the way.

I admit to being sceptical about the possibility of a V-shaped recovery, back in mid-2020, but I was wrong, and a V-shaped recovery is what has actually happened. That's what the stock market recovery told us would happen, and the market was right. I wish I'd looked more closely at GDP data last summer, as that might have stopped me continuing to fruitlessly short the indices over summer 2020, which was an expensive mistake (albeit funded by profits from earlier very effective hedging).

As mentioned yesterday, it's always better to focus on what is actually happening, rather than having a theory as to…

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