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Thread of random observations and forecasts for the coming decade - on markets and the world in general
Cycle lengths to b much shorter. Business cycle is being, and will continue being micro managed by central banks.
Economic Volatility will continue to be suppressed.
1/n
Cycle lengths to b much shorter. Business cycle is being, and will continue being micro managed by central banks.
Economic Volatility will continue to be suppressed.
1/n
Equity market vol will also be supressed as a feature- not a bug. as SIPs/ pension funds/ETF AUMs continue rising, it will smoothen the vol and add a steady uptrend that will last for perhaps decades.
2/n
2/n
Intra market divergence will widen due to the way money flows into equities, and mean reversion is never going to happen. In market share, the big will continue getting bigger, the also-rans will further lag behind.
3/n
3/n
Value investing is dead forever. (Famous last words?)
been dead for over a decade, for a good reason- there is no information arbitrage. Fund manager with $2000/mo bloomberg terminal in NYC has access to no more useful data than fresh grad in a village with a smartphone.
4/n
been dead for over a decade, for a good reason- there is no information arbitrage. Fund manager with $2000/mo bloomberg terminal in NYC has access to no more useful data than fresh grad in a village with a smartphone.
4/n
You can make money if the value the market gives it, is lower than the true value that you can calculate. With info arbitrage gone, the mkt is going to price it fairly, there is no value arb.
5/n
5/n
if you are a very good trader, you are better off trading for yourself + friends/family money than being in the money management industry. With widespread APIs, cheap data, as a small trader you have the edge over non hft hedge funds.
6/n
6/n
Everything is correlated now- there are only 2 states- risk on and risk off. diversification is dead. The only way to really diversify is to be in cash and not have a position.
7/n
7/n
Anything can fail- your broker, your bank, your currency, capital controls-etc. split your money- across brokers, banks, currencies and countries. among assets- gold, real estate, equities, bonds, etc
8/n
8/n
The global transition to electric vehicles is real, and its going to happen. as well as going driverless. Lot of white collar jobs- especially in banking, finance, retail and IT are going to get fully automated. Learn automation in your domain, or perish
9/n
9/n
The reversal of globalization is going to continue across all spheres of life- in trade, in culture, and even religion. backlash against multinational companies, capitalism, due to local issues, or even against religions/culture will likely continue
10/n
10/n
Widespread adoption of robotics will make labour less relevant to total cost, and onshoring will accelerate, most supply chains will relocate closer to end consumers. countries with large mkts and cheap energy will benefit greatly- US mostly. China, Germany to some extent.
11/n
11/n
There is no 'fake news'. There is just news. No one has credibility as an organization. Its shifted to individual reputation. With Patreon/Youtube etc, it will be feasible to be an 'independent' journalist with a large following and $$$
12/n
12/n
The traditional scheme of things- you save some salary, invest part of it, and a combination of that+ govt funds your retirement is broken.
The arranagement between labour and capital will need to be revisited from scratch. Almost all gains are now from capital
13/13
The arranagement between labour and capital will need to be revisited from scratch. Almost all gains are now from capital
13/13
