Brave New World

Prices were added to Trade Smash last week. Now you can see all of your positions in one place along with the percentage of your account.

You might’ve read Aldous Huxley’s dystopian novel Brave New World.

Or is it?

Everyone is happy on the outside (and inside due to their conditioning and hypnopaedic learning), and soma is regularly consumed to remove negative feelings and escape (the parallels with alcohol here are clear).

That said, the government has total control, there is no individuality, and no room for free thought.

So a dystopian novel it is.

But we as a society are entering into our own brave new world.

Think back to 2019.

No Covid.

No lockdowns.

No war in Europe.

Money was cheap, the bull market went on.

Fuelled by cheap money in an age where interest rates were rock bottom, asset prices shot up, including property prices and stocks.

The world as we once knew it has now changed.

I’ve often said before that many market participants were not even born in the last period of high interest rates.

For a period of 40 years from 1980 to 2020 interest rates gradually fell.

And since 2009 they went to rock bottom and stayed there; a permagrease on the stock market due to unprecedented borrowing.

That is now gone. Borrowing is expensive. And credit is now a real consideration.

This isn’t helping to attract capital back into stocks - especially UK ones - and we have to accept that this is our new normal.

Sneaking out the back door