Introducing 'The Uncertain Investor'
“Restless and incalculable, the speculative market reflects the wild ambitions, the reckless imagination, the haunted mind and the ever-mutable outlook of the business world and of humanity at large” (G.L.S. Shackle (1982) Means and Meaning in Economic Theory).
Those characteristically prescient words of the English economist George Shackle are an apt opening for 'The Uncertain Investor' amidst the ongoing turmoil of post-Brexit politics and economics.
Who am I?
Inspired by the emerging Financial Independence movement, particularly the writings of Monevator, Simple Living in Suffolk, and fuelled a few years ago by a combination of a sudden inheritance and growing discomfort with full-time employment I plan to ‘retire’ in 2017 but thereafter work on refining the raw thoughts and ideas I will lay out here as a bridge between now and then.
My investment journey
From an unhealthily young age I’ve been intermittently engaged with the stock market. My father set up a Barclays Unicorn financial plan to part fund my university life in pre-student loan days and I gradually became aware of his portfolio: Grand Metropolitan, Smithkline Beecham, Ash and Lacy, Ault and Wiborg, Ocean Wilsons.
As I studied A-level Economics the privatisation of British utilities introduced my mother to the stock market and I became her informal financial ‘adviser’ [no commission…]. I bought my first share in 1984 (12 shares in Applied Computer Techniques, makers of the Apricot PC) adding a rather random collection of unit trusts and individual equities in the following years (e.g. Hays, National Express). The 1990s and early 2000s was dominated by career-building and deposit-saving until the ill-timed purchase of a flat in the mid-2000s, coupled with lack of time and at that point relative financial ignorance, meant I could do little other than watch my savings decline through the late 2000s financial crisis.
The death of both parents, becoming an executor twice, inheritance, and the discovery that extreme early retirement was possible find me here. Since becoming mortgage-free in 2012 I’ve targeted 2017 as the year I walk away from my office for the last time and have been rapidly accumulating capital and knowledge to reshape a still growing portfolio to that end.
What can I add to the many wise words already posted by others on these themes?
However sophisticated I might feel my investment philosophy is, in practice it’s less Warren Buffett or Benjamin Graham, more as Eric Morecambe might put it: ‘I make all the right investments, but not necessarily at the right time’...
So I will use 'The Uncertain Investor' to highlight my mistakes (currently too overweight in UK small caps, too many UK equity income funds, too many investments, why no passives, why no bonds?...I could go on…) and the occasional success (Caledonia Mining, dividend up 22% today!) I will document my dilemmas, share links, resources, reflections and hopefully contribute thoughts to help us all navigate through treacherous times.
Why ‘The Uncertain Investor’?
The reference to, and contrast with, Benjamin Graham’s classic The Intelligent Investor is deliberate. Instructive though Graham and many other investment texts are, I've been revisiting the economic thought I briefly encountered as part of my degree in the 1980s. Keynes's General Theory, particularly Chapter 12, is always worth re-reading, perhaps even more so his 1937 article in the Quarterly Journal of Economics.
Yet as the opening quotation suggests one of Keynes’s lesser-known interpreters, G.L.S. Shackle, is the thinker I’ve found most probing.
Shackle’s distinctive approach to the human condition, “a theory of intelligent conduct in a flowing, enigmatic and elusive world”, regards choice not as a cool calculation of cost and benefit but as an anticipation of an imagined future and a commitment to a course of action in a time-to-come:
“Choice is a resolve, a moral and not merely an intellectual act […] In the act of choice, the chooser in some degree stakes his own self-esteem”. (G. L. S. Shackle (1979) Imagination and the Nature of Choice).
In choosing where to invest, more is at stake than our money.
My current reading/listening list
You Have to Invest (A Wealth of Common Sense)
How Real are those post-Brexit Gains? (Simple Living in Suffolk) which reminds me of Harold Wilson, 1967, 'The Pound in Your Pocket'
Aswath Damadoran's Musings on Brexit
Where are the Best Global Values? (Meb Faber podcast)
