2017 marks a number of financial anniversaries; the 1987 stockmarket crash, the 1997 Asian financial crisis, and the beginning of the global financial crisis. As we haven’t really experienced an extreme boom or crisis recently, looking back will be a refresher as to what could occur, but also provide a wider perspective on investment returns. Nothing is as evocative of the past as its music, so we accompany our look back with a soundtrack of those hits we think have withstood the test of time, and those hits that we would rather forget.
With Philippe Coutinho and Alexis Sanchez staying at their clubs, the most recent football transfer window offers a great example of the availability bias at work and a counter example to the common investment adage “buy the rumour, sell the fact”.
Just like cars, it costs more to maintain an older person than a younger one. Government borrowing could rise by 3% of GDP over the next 20 years as a result of ageing. To offset this, the UK government has squeezed the rest of the public sector in an attempt to balance the books. This seems politically unsustainable. Is the government about to reverse course by ending public sector pay caps?
A week is a long time in politics, as Harold Wilson famously said. So one can only imagine what he would have made of the past year in which the UK has voted for Brexit, changed Prime Minister, triggered Article 50 and held a general election. And while the political saga has been going on, the effects on the UK economy are only just starting to appear.