August 2024 Update

Half of August was spent on holiday and I’m currently writing this in a cafe from the amazing south coast of the UK. Just after the July update, markets took a tumble and I was mentally prepping myself for some negative numbers. However, a month later and most people have both learnt and subsequently forgotten the details of the 3 day yen carry trade drama. Turns out it was the market doing what markets do - reacting to news that turned out not to be such a big deal. Or maybe it is a big deal and it just hasn’t fully unwound yet. Stay tuned to the infinite market adventure to find out.

Keen not to let an opportunity go to waste, a tranche of cash that I’d been sat on got invested into the usual global tracker strategy (FWRA this time). The timing wasn’t quite perfect, but purchased a month ago, it’s up 5.5%. Not that it really matters in the scheme of things, but it’s given me a temporary warm feeling inside.

Interesting Reads

Howard Marks covers the yen carry drama and the resulting investor mood swings in his newsletter and comes out with all kinds of truth bombs. Definitely worth a read in full to keep things in perspective.

Mood swings do a lot to alter investors’ perception of events, causing prices to fluctuate madly. When prices collapse as they did at the start of this month, it’s not because conditions have suddenly become bad. Rather, they become perceived as bad.

Finally, the investment world might be less unstable if there were immutable rules – like the one governing gravity – that could be counted on to always produce the same results. But there are no such rules, since markets aren’t built on natural laws, but rather the shifting sands of investor psychology.

https://www.oaktreecapital.com/insights/memo/mr-market-miscalculates

As for the slightly depressing rise of drama of all sorts around the world, but thinking specifically of the UK situation, this article summarises it well introducing a ’new to me’ phrase of ’neotoddlerism’. Indeed.

The ease with which dramatic behavior gets attention online has convinced many political activists that a better world doesn’t require years of patient work, only a sufficient quantity of drama. Many activists on both the Left and Right now hope to bring about their ideal world the same way a spoiled brat acquires a toy they’ve been denied: by being as loud and hysterical as possible. This is neotoddlerism: the view that utopia can be achieved by acting like a three-year old.

https://www.gurwinder.blog/p/the-outrageous-rise-of-neotoddlerism

Net Worth Comments

The beginning of the month drama doesn’t even show up in the monthly update. Overall the portfolio is mostly flat. Crypto has taken a bit of a hit which has dampened down performance. Savings rate was down due to the regular rent payment but still a respectable 43%