There was a time when we could have earned some interest on any cash that we leave in the bank. That could have gone a little way to ease the damaging effects of inflation. But not any more.
There is a pretty good chance that gold could rise further, even though it has come off its all-time high. But – and here is the big but – I won’t be buying any.
John Maynard Keynes said that in an economic downturn, people should collectively spend more to avoid a deeper recession. But he also admitted that they, instinctively, tend to do the opposite and instead save more. We must avoid falling victim to the paradox of thrift.
Our job as investors is to try and identify those last-man-standing companies. To do that, we need to dig into their balance sheets and cash flow statements because cash is king.
A vaccine is not a fancy motorised scooter or a piece of operating software where a minimum viable product or MVP will do. This is not something that can be fixed on the fly after it has been injected into millions.
US Federal Reserve is aiming to boost average inflation above a 2% target, whilst keeping interest rates ultra-low for years to boost employment. The two key words are “average” and “target”.
