Corona & the Stock Market

Well, it’s been quite a week, hasn’t it?  Wherever you are in the world, it is fair to say that Corona is likely to have touched you in some way; it’s even reached the Faroe Islands!!

I, with my business travel, have been quite heavily impacted.  In March I was due to go to Taiwan and Australia.  The Taiwan leg was cancelled quite early on in the whole affair, while Australia as cancelled last week – 2 weeks before I was due to travel.  I was in Switzerland two weeks ago when the first case landed there and I am due to fly there again tomorrow.  I am not sure if this is a sensible thing or not, but it is a decision taken out of my hands. There is talk of Chris working from home rather than having to go into town every day and Dave barely gets out of bed anyway, so he should be fine…which is a bit of luck as he’s the only one who seems to know what he’s doing here.

Some context

The economic fall-out from this has to be massive.  9/11 impacted travel, but life mostly went on as normal in domestic economies, the (second) Iraq war which followed didn’t really do much to the world economy, swine flu, SARS, foot and mouth…all of these things had a local impact, but not global like this seems to be doing.  The ones doing well right now seem to be toilet paper and disinfectant manufacturers – there is always someone making money somewhere, after all!

TMM is taking a cautious but determined view to all this.  Nothing has stopped from our side.  Our business doing terribly before Corona, so there has been nothing to impact it to be honest.  Sports events are still going ahead and probably will throughout, even if they’re behind closed doors, so Matched Betting is still going to generate a few quid here and there.  Let’s not forget the rich pickings of Cheltenham started today! Surveys are still on-going – in keeping with the times, I’ve got a telephone survey on Monday which will put a few pennies in the pot.

Please keep spending

If we can use this website for any good at all, it would be to make an appeal to you, our dear reader, to keep spending as normal…and if you can, maybe a pound or two more than you usually would. For us all to get wealthier, money has to flow; there is no good in hoarding it all in savings and investments. Even if you’re just buying and selling on eBay for example you’re putting money in the pocket of someone selling and giving the postman a job. Simplistic maybe, but vital for all. It generates wealth. I’m personally taking this view right now and making a conscious effort to use independent traders while things get a little hairy.

That said, we can’t ignore the fact that TMM exists to grow our personal wealth AND that the chaos in the financial markets has created a great opportunity (yes, yes, yes…I know this completely contradicts what I said above, but right now, I’m quite happy to find a balance)!

The TMM Investment Club takes off

Chris, Dave and I had discussed the possibility of creating an Investment Club arm of The Money Mountain, but decided against it as all of us already invest in shares in some form or another, so it wasn’t really in keeping with the spirit of this particular financial car crash you all love reading about so much. The opportunity has now become too interesting to keep ignoring. We’re going to do it.

There are a number of reasons behind this decision:

• The buying opportunity created through buying when the market is low
• The need to diversify our portfolio and generate new growth and income
• The need to do something with the cash we’re generating
• The possibility that Matched Betting isn’t going to last forever (it’s demise has been written and spoken about by better men than us, but there seems to be a definite squeeze on right now)

As always, we are not giving this as financial advice. I hate that we have to say this every time, but we have to clear about it. We are not advocating ploughing your life savings or even the contents of your penny jar into the stock market right now…or at anytime for that matter. If you are considering it, please go and see someone who knows what they’re talking about, not three fools who clearly can’t make a penny.

Having listened to and read the words of those qualified to talk about these matters, all of us are fans of the message that it is time in the market rather than timing the market, let’s face it, things could get a whole lot worse before they get better. We could stick a grand in the market and lose a huge chunk of it over night the way things are going right now and as the Top Gear of the financial world, that is exactly what will happen, I am sure of it. Warren Buffet should change his famous phrase to “be brave when TMM is fearful, be fearful when TMM is brave.”

The plan is to keep plugging away with the Matched Betting this month and see how much we can get together by the end of March with a view to investing before the end of the tax year (5th April for any of our overseas readers). We’d like to put £1000 into something and while we haven’t finalised what as yet, it is fair to say that it will have to generate an income. If it’s one thing TMM LOVES, it’s income.

We’ll not reveal what we invested in exactly, but we’ll give you a some details once we’ve bought it and keep you updated on how it performs.

That’s all for this week. Keep washing your hands and don’t lick the hand rail.