By Al Emid  

Toronto – Canada

 

 

 

 

Al Emid has worked in communicating ideas and concepts since beginning his career at an educational television network in 1967.  He is the co-author and author of several financial books, most recently The Emid Report on Volatility 2019 available on all major book sites.

 

 

 

 

 

Chapter 22

The Market is Shifting and Confusing

 

 

 

An investor can be forgiven for listening to the investment news these days and feeling confused, worried, considering a retreat from the stock market, staying in cash or low risk investments, or all four.

 

And that is certainly understandable.  The feeling has several causes, among them the vast amount of financial information and analysis, much of it well-done and some of it not so well-done.

 

Yet, the greater villain is the constantly shifting and moving market conditions in which events turn out wildly different than anticipated.

 

The ongoing BREXIT saga one of the largest current examples.  At time of writing European Union officials have agreed to another extension beyond the formerly theoretically firm October 31 deadline although they have not set the length of the extension. (Some wags delight in saying that the ‘final-final’ divorce date which is now not final is Halloween.) The saga has driven down valuations of the Pound Sterling and domestic British companies.

 

Harsh geopolitical realities are not very far down the list.  The initial public offering (IPO) of Saudi Aramco was delayed from its October 20 launch date and may – or may not – launch by yearend.  The IPO was important for several reasons: it is considered the world’s most profitable oil company; it was emblematic of Saudi Arabia’s plans to reshape the economy and it would have given investors an infinitesimally small stake in a country that never would have allowed it ten years ago.  The obvious reason was the attack on Saudi Arabia’s pipelines, but some analysts believe that the company’s books need more clarification.

 

I could easily list another half dozen causes but one conclusion is clear: low interest rates on savings make investing in the stock market crucial for most individuals.  With some exceptions, retreat is not an option.

 

 

 

 

 





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