Looking Back

I find it hard to believe it is now 4 months since my last post. Probably any readers (if there were any) have given up!
My original idea was to write down some investment ideas so that I could use the record to look back and so how those ideas turned out. Now seems to be a good time to do that.

In Between a Northern Rock and a Hard Place (19th November 2007) I suggested that Northern Rock shareholders would end up with very little. Following the subsequent nationalisation that seems very likely.

Renold Renewed (20th November 2007) was when I bought into Renold most heavily at around 86p. The price is currently still around that level or a bit below although the company continues to trade well and I'm happy with my position.

I've done well out of a few IT companies bought since the dot com crash and nCipher is one of them. See The Need for Data Security (22nd November 2007). I wasn't very happy about subsequent management changes but the company is currently in process of being bought at 300p a share giving me a nice profit.

Sold out of China (29th November 2007). This was an outstanding call. This was close to the top of the market and subsequently Chinese stock markets have fallen by almost two thirds and the particular funds I had invested in are down almost half from their peak. Note the funds I had money in were probably invested via Hong Kong and this market for Chinese shares didn't bubble up to the same extent as the local Chinese Stock Markets and hence hasn't fallen so far.

Royal Bank of Scotland (6th December 2007) didn't work out for me. RBS will survive, unlike the US investment banks, but I was shocked at just how hard the impact of the current crisis has been on financial institutions. But at least I recognised the weakness of Alliance & Leicester Business Model Broken (21st February 2008), which subsequently had to be rescued by Santander and the relative strength of Lloyds in Dull like a Bank is Supposed to be (22nd February 2008)

The Coming Oil Crisis (11th December 2007) however was spot on. Oil hit a peak of around $147 a barrel in 2008 causing a massive shock to the oil dependent economies and businesses. I wrote more about oil in 2008 and despite the recent pull back to below $90 a barrel I expect oil prices will rise again in the near future.

In The End of Disintermediation (29th January 2008) I had started to think about the impact on the banking model and investment banks in particular. I can't claim to have predicted their demise but made very clear my aversion and the fact that the investment banking model would need to be revised. A return to old fashioned relationship banking now seems ever more likely.

More to follow.