What We Think

Investment Views

We try to see the investment world as we think it should be seen – with a fundamental investment perspective.

Central bank monetary easing and government fiscal deficits have taken financial markets into uncharted territory.

Government debt growth to fund fiscal policy to stimulate economic growth, and corporate debt growth are unsustainable.

Deflationary pressures have been present for many years now, and present a problem when inflation is needed to erode the extraordinarily high levels of debt. Inflationary pressures and expectations, interestingly, are being seen for the first time in a long time. Oscillation between deflationary and inflationary views is increasing market volatility.

Medium-term, in our view, the most likely market environment will be economic growth that continues to be slow and sluggish at best, coupled with inflation.

For investors, unfortunately, this will be a very difficult environment in which to preserve and grow real wealth, particularly if inflation increases significantly.

Currently, US equity markets offer extremely poor value, and other equity and bond markets offer poor value relative to risk.

Investment with perspective is necessary to navigate uncharted waters.

Note that the investment views above were as at 31 December 2024 and are subject to ongoing review so may have changed since.

Investment Portfolio

Currently, our flagship core investment portfolio is more different than ever from conventional investment portfolios: our equities exposure is positioned to profit from a significant fall in equity markets, although we do have exposure to equity investments that we believe are at reasonable valuations and will appreciate; we have limited exposure to bonds; we have exposure to precious metals and producers; we have exposure to real estate opportunities with decent expected returns; and, we have a significant allocation to alternative investments.


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