Yesterday’s idea – the somewhat controversial view from Nickolai Hubble that Brexit (even a hard one) could send certain UK stocks soaring – brought a predictably large response.
My inbox filled throughout the day with your replies.
One in particular caught my eye. It asked me to find a way of shutting Nick up. His work is “semi-political” and claimed “he’s clearly a young man who doesn’t know a lot about the real world”.
I think that’s wrong. Nick’s work isn’t “semi-political”. It’s 100% financial. Nick believes that political decisions move markets. If you interpret those moves correctly you can make better investment decisions.
That’s not political. It’s about politics. But it doesn’t seek to make a political point or persuade you of a party political idea. I don’t think Nick cares how, or if, you vote. I know I don’t. It’s none of my business.
As for the second comment? If you ask me, it’s a classic case of what I call the Lance Armstrong defence. It’s best summed up as “if you can’t play the ball, play the man”.
All I can offer as a defence is Nick’s credentials. He started his career at Goldman Sachs. He was there during the financial crisis. He’s worked for two extremely successful publishing businesses in Britain and Australia. He was also invited to tour Europe for two months as part of the Free Market Roadshow, giving speeches in more European capitals than I can name.
He’s a real internationalist – born in Germany, brought up in Britain, educated in Australia, with a Japanese wife. He’s also an unashamed anarchist.
He has the biggest following of investors of any single expert on our roster. More than 10,000 people pay to receive his work. Thousands more read his free emails each day. And he wrote one of the biggest selling books I’ve ever published, How the Euro Dies.
Oh, and in between all that he became a professional trapeze artist.
I don’t know why that all makes him not “real” enough, somehow. I’m not even really sure what that means.
I think this – as with 99% of the criticism Nick gets – can be summed up in nine words: “I don’t agree with you, so please shut up.”
Which is fine. You’re not supposed to agree with everything. If you don’t agree with him, ignore him. But plenty of people do agree. And I think that’s the real problem some people have. They want the world to agree with them. When it doesn’t, they get angry. And that anger is directed at people like Mr Hubble.
Who seems to enjoy it, frankly. I think people disagreeing with him tells him he’s on to something valuable. Universally accepted ideas often turn out to be worthless. Call it the first law of groupthink.
Here’s another note I spotted…
To Nick’s Fantasy Trouble Bubble:
“Britain freed from the EU would should could boom… Trade deals become easier after Brexit.”
The facts (from Wikipedia):
The European Union is the second largest economy in the world in nominal terms (after the United States) and according to purchasing power parity or PPP (after China). The European Union’s GDP was estimated to be $18.8 trillion (nominal) in 2018, representing ~22% of global economy (Nominal global GDP).
The euro, used by 19 of its 28 members, is the second largest reserve currency as well as the second most traded currency in the world after the United States dollar. The euro is the official currency in 25 countries, in the eurozone and in six other European countries, officially or de facto.
So, you recommend we shun a trading bloc representing nearly a quarter of the global economy? And how do you expect trade deal negotiations with the EU to commence? BoZo will vaguely refer to them as “our friends in Europe” before they raise their first two points: an Irish border backstop and the small matter of £39bn.
I’d have to disagree there. Mostly because it totally misrepresents Nick’s view, which can be summed up like this: Britain will, on average and over the long run, be better off running its own trade policy.
That’s it. No shunning. Just that negotiating for yourself is likely to be better in the long run than being a part of a bloc, which can be dysfunctional.
That doesn’t mean shunning Europe. That much is obvious. It means that in ten years’ time, when the UK has done a trade deal with the EU, the US and half of the rest of the world, the pound will be stronger than it is today.
You may think that Britain will never manage this. Fine. I think, in the end, most countries (and the EU) will recognise that trading with each other is better than not trading with each other and so reach a deal. You might disagree. But don’t misrepresent Nick’s views and claim he’s in support of some sort of “shun” policy.
Let’s dip into the rest of the mailbag. Tuesday’s essay – on what they teach, or don’t teach, you about money at school – brought some interesting replies. Like this:
I think I’m a practical person and after a lifetime in Engineering. My opinion is that educationalists believe young people need to be taught other things first i.e. responsibility, cultural skills, practical skills, communication skills.
Now at 87 years I’m using you and your team to belatedly learn even the basic things about wealth.
Many thanks for what you are doing for me!!
Great to hear. And I agree. Though I believe teaching young people about money management, risk and investment strategies would help too. No generation has had such a vast amount of opportunity available to them – nor such freedom to take it.
Teaching young people that you can grow your wealth alongside the very best and brightest innovators, engineers and entrepreneurs in the world. That is the beauty of the stockmarket. You are taking a risk. But you’re joining forces with people seeking to create wealth. If they succeed, you share in that wealth creation.
That idea alone is powerful enough to shape a young person’s life. Why? Because it leads to responsibility and prudent saving. How else can someone scrape together a little capital to get started? By saving, of course.
I think that’s a more powerful motivator than “saving for retirement”. I know this is important, but it doesn’t have any emotional resonance for a young person. Whereas sharing in the world’s biggest success stories and growing your money alongside the rich and the powerful… that’s more immediate.
And I’ll leave you with this one. It’s not about succeeding in the stockmarket. It’s more fundamental: how not to go broke!
Hi Nick, couldn’t resist replying to this one.
Money management is simple. Follow these basic rules and you will never be broke.
- Never spend more than you earn. Easy credit has blurred this rule and people don’t know how to gauge what effect credit (cards, mortgages, loans etc) have on their financial situation. Kids should be taught what credit really costs, and how to gauge what is a fair credit deal.
- Regular savings. There are two types. First, short term savings which are for life’s little bumps such as a new tyre for the car, the washing machine packing up, the holiday, that new sofa etc, etc. The second type is long term savings. This is for things such as the house deposit, or major house improvements such as extensions, conservatories, or start-up capital for that business you’ve always wanted to start, etc etc. Saving has to be a regular habit so it should be taught to kids by both their school and their parents.
- Keep track of your money, both incoming and outgoing. Again this is a habit that kids should learn early on so that it becomes an instinctive thing.
Remember, this all assumes that you have an income in the first place. But if you have that income and do these three things, you will never be broke. I know it seems obvious but if you look at personal debt problems it is always because that person has broken one or more of these simple rules.
Have a great weekend,
Publisher, Exponential Investor