Pride comes before a fall…

Peaks in UK consumer confidence

Both common sense and history would encourage us towards thinking equity investors have a greater chance of strong returns when confidence is low not high. Likewise, unemployment, car sales and house prices… People are still talking about stocks positioned for the recovery, but we are five years on from the last trough in the market. A lot of investors say it is about feel good factor, but in the UK the feel good factor is driven by house prices. There is very little evidence of a sustainable, non-volatile recovery and the more I hear people saying it is inevitable house prices will go up the more I think they look dangerously high. People have such short memories.

Paul Stephany, Newton 

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