Hello 2019

After an explosive Dec where most investors sat silently on the sidelines while seeing their portfolio being decimated, we welcome the new year with timid trepidation.

Last month was a recipe for disaster in thin liquidity, the holiday-induced environment where everyone got whipped by multiple unexpected events going into the year-end. Not surprisingly, almost 90% of these events could be attributed to one man, the most powerful person in the world throwing a tantrum and spewing nonsense – the orange moron.

Economists generally agree that the first quarter of 2019 will likely be flawed by extreme volatility as the world grapple with conflicting signals on the direction of the world economy. Most of these events are man-made and avoidable as we face a new world that has turned onto itself. It has become every man for himself, a selfish screw-the-others type of attitude.

Major superpowers are jostling to maintain their self-interest while trying to navigate uncertain times. Conflicts are the norm and upping the ante is the name of the game. This playbook is getting to be a standard modus operandi for G10 countries in a bid to maintain a semblance of control.

The GOP and Democrats are in for a slugfest with the supposed moderator (ie. Trump) going apeshit most of the time. The only way to get some balance of sanity and calm into the US market is looking like an indictment or impeachment of the president when the Mueller report is out. Pence will take over for the remaining time till the 2020 fireworks happen again. You could really see in reality TV mode a cornered animal situation where it is fighting to stay alive. It is all downhill from here.

I do not see a recession in the near term as the markets have overreacted on the bearishness last month. Naysayers predicting doomsday is a bit too premature. The underlying economy is still relatively robust and inflation does not look to be running out of control yet, as technology advances help to suppress price rises.

I still aim to scoop up quality stocks if prices continue to drop. Apple comes to mind with their cash horde and premium product branding. Facebook and Google also have a huge cloud business that is not being valued correctly, plus the big data they have which has not even been fully analyzed and utilized yet. Flight to quality assets has caused US Treasury yields to dropped a fair bit. The interest rate cycle is up, so there is no reason for yields to stay low. I am looking for a way to short the 10 years US Treasuries as I believe that the yield would pick up again.

REITs are also coming into favour again. About 25% of my portfolio is already in this sector. I have been expanding it over the last few months with newer ones in the US markets which I like. Some are REITs fund of funds which is even better.

Resolutions of the year? Below will be a list I would want to embark on :

1. Create a new learning plan for 2019     –    I have completed most of my courses, time to do more to continue my learning path. Immediately, I will be committed to doing at least 10 more online courses for this year, mainly from Udemy and the like. I would want to sign up for more SkillsFuture courses which interest me. You die if you stop learning.
2.  Be more aggressive into new business investments     –     Over the last 24 months, I had explored a number of investment opportunities but they have not been able to reach the execution stage. As one of my friends said recently, like investment banking, closure is key. NATO (No Action Talk Only) is a waste of energy. One has to get his toes wet in order to experience the entrepreneurship side of a business. Be less conservative and take more risk – learn from failures and aim to start something. My Myanmar consultancy role is already 12 months old. Not sure if it will continue, but I should use that to my advantage and expand on it while I am still taking on the job.
3.  Learn new skills     –     Got a drone last year. I need to fly it more often and use that to improve my video editing skills. I did successfully grow hydroponics vegetables finally. Maybe I should try aquaponics next. Completed the Business Analytics Diploma in Aug, time to dive deeper into this subject. Big Data is the next new frontier and I have to create my new niche utilizing my past banking experience. I always believe that the one eye person is king in the country of the blind – I need to reinvent myself and find that edge.
4.  Give back to society     –    In a way, my Myanmar consultancy role is to indirectly help farmers out of their cycle of poverty. I have also started mentoring a uni undergrad, to share with him my experiences to better help him prepare for the real working world. There are more ways for anyone to give back to society. I should seek to do more now as I have time on my hands.
5.   Read more books     –     I do read a lot, but its mostly news and business magazines. My son started reading “Rich Dad Poor Dad” recently and I decided to join him too. I aim to read at least 10 books this year. They may be in various topics and area of interest. I must cultivate this good habit as it will enhance my learning curve.

2019 has arrived. Sitting on my butt and doing nothing is not an option for me. I want a more fruitful 2nd halftime. I will need to put in more effort to proactively create a game plan for this year.