Weekend Reading #292

This is the two-hundred-and-ninety-second weekly edition of our newsletter, Weekend Reading, sent out on Saturday 16th November 2024

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What we're thinking.

Another week, another all time high notched intra-week by the markets at index level, followed by a pullback as the week ended. This week was the week for commodities to get the whip. After the election and the broad predictions of a weak dollar, the exact opposite happened and the dollar strengthened with reasons suggested after the fact, Trump’s tariffs, Elon’s cost cutting etc. It may still unfold that a weak dollar ensues, but it isn’t happening at present. And that’s generally bad news for commodities. The one that is bucking the trend is Aluminium which seems to be in a very specific situation with its key raw material, Alumina, in short supply at present. Gold is having its corrective moment as is Dr. Copper. In stocks, Nvidia is quietly extending its lead at the top of the standings too. Will it keep its lead? What if it does and they all fall together? Space and Quantum computing stocks are bubbling up. What kind of a market are we in? Does it matter to categorise it? Who knows?

We finally got our Bitcoin breakout and even Ether went up for a bit before once again being overtaken by the best and the brightest – Yes! Memecoins! This crypto breakout once again characterised mainly by Bitcoin and Memecoins! Dogs, cats, goats, squirrels and even cows this week. Finally crypto is fun again. Cue the takes from “experts” about how Dogecoin’s market cap is 2/3/4 x (insert favourite US value stock/nations equity market).

What we're doing.

I won’t pretend to be a participant in the “art scene”, though I’m trying to learn so I went along with my folks this past week to The National Portrait Gallery to see an exhibition on the work of Irish painter, Francis Bacon. There were hundreds of people in this small exhibition either really clued up on it, or curious about it or just pretending to be. It was really interesting but what always fascinates me about people who change the world to some degree is who they hang out with and how they often hang out in clusters – particularly in the creative arts. Inside Bacon’s group of friends were fellow artists, Frank Auerbach and Lucian Freud, each famous if not more famous in their own right. Worth a visit if you are in or around London. DC 

Being in Singapore for meetings offers up a reminder of how the attitudes of the business and investing community become significantly more open and generous with a backdrop of economic growth and stability. From meetings happening around iConnections to the FIX conference to simply catching up with friends, the willingness of everyone to generously share introductions and referrals without any expectation of getting anything back is a refreshing change. As a bonus, the weather is by no means as hot (though equally humid) than the summer – there are variations of temperature, but not London style, more like day highs of 31 degs rather than 37 degs in summer, and if lucky, a nice cool breeze in the evenings and early mornings.

A friend who was in town with us, visiting Singapore for the first time, also took the opportunity to try out some Japanese restaurant chains to compare them with the quality of food in Tokyo, where he’d lived for a couple of years. We joined him for dinner at Sushiro, which was reportedly an extremely good quality, good value for money chain in Japan. Unfortunately, gauged against that standard, Sushiro in Singapore clocked in at a 5/10 on his scale, though resetting the benchmark to London standards it gets closer to 7 or 8. I personally found it excellent – caveat being that I’ve unfortunately never been to Japan. EL 

What we're listening to.

This is a just critical conversation on the Talking Billions podcast with someone I remember from my earlier days in South Africa as a young analyst. His name is Nick van Rensburg and he is a former HF manager. The conversation is about something we focus a lot on here – passive flows and their impact on market structure. This is prescribed listening for anyone that trades markets. We saw a possible preview of what happens when the music stops in early 2020 when for a short period there were no bids in markets. This helps explain why and also helps understand what it means that passive is taking a larger and larger share of the market. Hint: It may not end well. 

I had debated in my head whether to share this one with the audience of this newsletter as it is really “out there” but the truth is why not. I would like to think readers of this newsletter have an open mind so here goes. This is actually fascinating research and probably the most thought provoking series of podcasts I’ve listened to maybe even ever. It covers the investigations by a woman named Ky Dickens into possible telepathy (yes, mind reading) in non-verbal, autistic children. What’s fascinating about this series is the level of experimentation and investigation performed not once but repeatedly with the same results. This outcome of these investigations brings questions and theories about the very nature of consciousness, spirituality and indeed reality itself. The implications are mind blowing. (Thanks once again to Tom Morgan for the discovery!) DC 

What we're reading.

It’s probably worrying that one can open the Apple news app in November and start wondering if it’s actually April and the papers are printing April fools’ joke articles. Case in point, this one that popped up today about some honestly ludicrous investigations done and recorded in the UK by the police. You’d need to read it to believe it, but if you want to avoid the cringe, the short summary is that kids were being investigated by the police for calling other kids names. Aside from this sounding like a snippet from a modern adaptation of 1984 (which I’m listening to on audiobook at the moment), it’s also a terrible waste of police resources when there are so many other issues that require their attention. If this is what the UK is raising taxes to fund, then the real crime is surely in their choice of priorities. EL

What we're watching.

I watched the second season of The Diplomat with Kerri Russell on Netflix. It’s a really good political thriller. The first season was great and this didn’t disappoint. An old favourite from The West Wing days, Allison Janney, who played CJ, made an appearance as the US vice president, which was quite cool. From one political series to another many decades later.  DC