Every year December seems to come around more quickly than we expect!
Thanks for the support and engagement over 2022. It’s been pleasing to see Covid-19 move slightly into the rear view mirror, but it’s important to remember that it’s still out there, so stay safe over the Christmas holidays. As always, one challenge will pass, and others will emerge. Essentially that’s life and investing.
What did we learn in 2022?
Assets that have proven investible over the long term have continued to behave as expected, but risk is always a factor. Equities have shown they’ll be negative one in every four or five years over the long term. Bonds have shown they’ll be negative one in every nine or ten years over the long term. They aren’t usually negative at the same time, but interest rates haven’t moved from almost nothing before at such a sharp pace.
On the “new asset” side, eventually reality catches up to speculative hype. 2022 was a reckoning for crypto currency. Many coins have been wrecked and while bitcoin still remains above where it was pre pandemic. It now exists in a different reality where a significant number of people have gone from being interested in it, to having their pants pulled down by it.
There are two distinct groups of crypto investors: a small group of true believers who invested early, know the technology inside and out, and likely have custody of their own coins offline in a cold wallet. Then there’s a large group of everyone else who wants (or wanted to) speculate later and took the fact that platforms existed, meant that platforms were safe to put their money onto. They didn’t bother to investigate further, nor could be bothered to. The average person does not want to be their own banker or custodian. The first group likely won’t go away, but the second group likely will go away because they’ve been burned badly by massive price drops and fraud. The second group disappearing will ensure cryptocurrency now stays on the fringes of finance.
We learned how to publish a book. We’ve already told you the why of writing a book, but one of the more interesting parts was the publishing. Late last year Amazon’s Print-on-Demand service started in Australia. Essentially you do all the formatting and editing work (or pay someone else to do it) then upload your book to Amazon’s platform where it’s then listed in ebook and print formats. It’s available for sale without having to upfront cover the cost of hundreds or thousands of physical copies because Amazon only prints and delivers a copy when someone orders one. Importantly, the physical copies are high quality. Not only did we receive plenty of positive feedback about content of our book, but we also received many positive messages about the look and feel of the book.
If you ever think you have a book in you, we can recommend Amazon’s Print on Demand service. The platform also opens you up to a wider audience, as a third of our sales so far have come from overseas.
Awareness & Self Care
We’ve told this story for the past two years and we’ll recount it again. Important messages cannot be repeated enough. Having time on our hands over the Christmas break, it’s worth remembering before eyeing off a branch or gutter than needs attention.
On more than one occasion in recent client meetings, it has been relayed to us that one partner (we won’t mention the gender) decided to pull out the ladder and start chopping bushes or trees. On these occasions, the amateur arborists both had near misses. They took a tumble which thankfully only ended with very minor injuries and dented pride.
We raise this because we also help clients with their insurance. Last year we had a client who also took his chances up a ladder cleaning gutters. It didn’t end so well. Down he tumbled. Cracked vertebrae. Ongoing pain dulled with painkillers. Insurance claim. Still not back to full functionality. As advocates of insurance, we’re glad he was covered, but we wish he didn’t have to make the claim. And we know he thinks the same. Much better to not fall from a ladder in the first place!
The client, who lives in an east coast capital city, recently relayed more about his accident day to us. The thing that really stuck out was what he found when he arrived at the hospital. He wasn’t the only one who’d fallen from a ladder that day. There were four other men who’d also had big falls! All with serious neck or back injuries, some also had other bone breaks and bodily trauma. And we will note, it’s not always just middle aged or older men. The most badly injured person on this day was in his early 20’s. He had an unstable spine fracture and was extremely lucky not to be paralysed.
There might be a temptation to clean gutters or trim trees over the holidays, but maybe just wait, be safe, and hire the professionals to do it.
More than three years on, specialist after specialist, and the pain hasn’t subsided. Work? Can’t sit for long periods. Still relying on that now incredibly valuable insurance coverage that has continued provide for their family and looks like doing so into the future. And as valuable as their insurance has been, they’d definitely prefer not to be using it.
Our Best of 2022
Insights From Your Fellow Investors: What should you do in a rough market? Often the best advice comes from investors just like you.
Finfluencing Poses Age-Old Product Problem: Finfluencing took off during the pandemic as many young people became an instant finance experts. Too often it was product pushing under a different name.
Decisions in the Aftermath of Divorce: A celebrity divorce trial offers some lessons on how our behaviour and thinking may be affected during a stressful period.
Act As If with Aged Care: Decisions are often made in the here and now. Age and frailty can sneak up on us and financial decisions made with the best intentions can cause problems if we need aged care in the future.
Evolving From Perfection to Success: As strange as it seems, you won’t achieve success by trying to be perfect. Lessons from Andre Agassi and Serena Williams.
Down The Rabbit Hole: Large asset managers like Vanguard and Blackrock somehow got into the sights of conspiracy theorists. Is something dark and evil going on, or is it more mundane?
Other interesting stories to read over the holidays
The Crypto Geniuses Who Vaporized a Trillion Dollars: Everyone trusted the two guys at Three Arrows Capital. They knew what they were doing — right?
I Lived the VanLife. It Wasn’t Pretty: Youtube videos and Instagram posts make living in a van seem somewhat glamorous. For this writer it wasn’t the case.
Disaster at 18,200 feet: The story of what really happened when a mountaineer fell 1,000 feet while summiting North America’s tallest peak, Denali.
The Demon River: On the night of November 15, 2021, British Columbia’s Nicola River sounded like thunder. Boulders boomed beneath a raging current that was bursting its banks, taking out everything in its path.
The Nocturnals: While most people are fast asleep, some ultra-introverts are going about their lives, reveling in the quiet and solitude.
With that, the MFG office will be closed from Wednesday 21 December at 5pm and we will reopen on Monday 9 January 2023.
This represents general information only. Before making any financial or investment decisions, we recommend you consult a financial planner to take into account your personal investment objectives, financial situation and individual needs.
