Points of Few – How to Invest Long & Prosper

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“Once you have eliminated the impossible, whatever remains, however improbable, must be the truth”

By Alan Steel

While I confess that I’m not much of a Trekkie, given the abundance of what is arguably extremely “illogical thinking” amongst the investor community over the last few years, maybe a Vulcan’s view of Wall Street this morning is in order.

Now, let me start by saying that 99% of the daily financial media speculation is about as useful to your investment decision-making process as a one-armed trapeze artist with an itchy arse.

The vast majority of those who sit behind the news desks and blogging screens simply do not have the tools to do that job.

And alongside the fact that the uber-complexity and interconnectedness of the global financial markets can break the drill bits off the most adept data mining operations aside, newsreaders playing market mediums by suggesting the future direction of a stock, sector or index are continually distracted by their overriding primary commercial imperative; to editorialise in pursuit of clicks and eyeballs.

What that leads to is a contrived future view; they make out we’re in a state of perpetual Armageddon because it sounds better to be negative, and the larger audiences which that noise tends to attract bring with it larger advertising revenue streams.

Meanwhile, there’s a highly illogical assumption that a news desk can assemble a credible daily market forecast (including downtime for hair and makeup), when top flight investors and research houses like Warren Buffett and Ned Davis Research, respectively, wouldn’t touch that effort with a barge pole.

Yet, still the investor herd listens and moves with the media; ending up more nervous than a long-tailed dog in a room full of rocking chairs.

We can see it in their behaviour – the trillions in cash, the dire market sentiment levels and the downright odd herd movement towards safety as major indexes breaking records, and the 30 (plus) year bond bull gets strangled in a dark corner by historically low interest rates.

More worrying still is a new report from the University of Cambridge that claims men who suffer from anxiety are more than twice as likely to die from cancer as men who don’t.

According to that study, General Anxiety Disorder (GAD), which is excessive and uncontrollable worry about many areas of life, establishes a strong statistical association between cancer and other forms of clinical anxiety.

Unless you’re a woman, that is.

Apparently, of the 16,000 Britons who took part, chronic anxiety only appears to affect males in this way.

So it would appear that (if you’re amongst the male population) the best way to combat poverty and mortal afflictions is to either; fill Wall Street with the fairer sex, and/or avoid that which ails you.

And if you want to live long and prosper, turn off the news and get some good advice instead.

Because after all, it’s your money.

Alan Steel, Chairman, Alan Steel Asset Management

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