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Weekend reading: Far out

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What caught my eye this week.

With hundreds of investing blogs having published thousands of articles over the past decade, there’s a lot of repetition around.

(Indeed I’m getting déjà vu. Didn’t I say much the same the other week?)

Anyway, you have to admire a post that finds a new spin – such as combining astrophysics and economic upheaval, as Klement on Investing did this week.

Especially when it brings – ahem – gems such as this:

The chaos of the universe is needed to create new structures. And islands of order like a star and its planetary system eventually disintegrate into chaos out of which new structures are created.

A wonderful symbol for this order out of chaos is the fact that on Neptune, the atmosphere is so volatile and chaotic and the pressure is high enough, that scientists suspect it sometimes rains diamonds on it.

Wow. I wonder if Elon Musk is short Tiffany, the upmarket jewelry store?

Let there be… light entertainment in the interlude

Klement’s argument is that the confusion and misery of Covid-19 will similarly produce much of value in time.

But it seems a stretch to compare diamond showers on faraway worlds with people working in their pants and not shaving for a week, or with Starbucks staff serving coffee from behind a 2″-thick plexiglass screen.1

When it comes to our investing beat, the disruption is mostly just more oddness, which is at least on-brand with the times we’re living in.

CNBC veteran Jim Cramer, for example, is using his airtime to lambast the antics of the lockdown day-trading generations’ Pied Piper – the Internet entrepreneur Dave Portnoy.

There’s probably 50 years separating the demographics of their target audiences, but I’m sure they’re united in enjoying the spat.

Who knows what happens next. We seem to have run into an air pocket – in the markets, in the global Covid-19 narrative, and in the economy – where everything is neither getting better or worse, at least for a moment.

Normality returning? Or maybe we should hold on to our hats (and our diversifying safer assets…)

From Monevator

Opened your first trading account during lockdown? Here’s how to make money in shares – Monevator

From the archive-ator: How slow growth affects your investment goals – Monevator


Note: Some links are Google search results – in PC/desktop view you can click to read the piece without being a paid subscriber. Try privacy/incognito mode to avoid cookies. Consider subscribing if you read them a lot!2

UK economy shrinks by a record 20.4% in April due to lockdown – BBC

Britain will see the ‘worst’ economic contraction among developed nations, says OECD – Sky News

US Fed sees zero rates to 2022; recommits to bond buying – Bloomberg via MSN Money

Bankrupt Hertz seeks permission to raise $1 billion in ‘preposterous’ new stock sale – Forbes

UK dividends down £12bn so far, a 16% drop compared to 2019 – ThisIsMoney

Unilever to ditch Anglo-Dutch dual structure in favour of a single base in London – ThisIsMoney

[Click to enlarge the mania]

A graphic illustration of the explosion in trading I wrote about last week – Jon Krinsky via Josh Brown

Products and services

Hardy any mortgages available now for buyers in England with a 10% or smaller deposit – Guardian

Rare Kew Gardens 50p keeps growing in value; worth 2,733% more than a decade ago – ThisIsMoney

Home insurance premiums jump in cost; one in ten households consider cancelling – Which?

Sign-up to Freetrade via my link and we can both get a free share worth £3 to £200 – Freetrade

Homes with a garden are the new must-have for buyers – ThisIsMoney

US fund fees have been cut in half over the past 20 years – The Evidence-based Investor

Properties for sale with a lake or moat [Gallery]Guardian

Comment and opinion

The ETF industry’s Tower of Babel – ETF.com

Backtests versus real-life in the markets – A Wealth of Common Sense

My bad – Humble Dollar

Will you be bothered to pay £50 a month for the gym when they reopen? – Guardian

The stock market almost always seems disconnected from the economy – Bloomberg via Yahoo Finance

US fund managers failed to beat the market in the chaos of early 2020 – Institutional Investors

Wade Pfau: The annuity puzzle – Forbes

Bonds and the invisible thief of inflation – Factor Research

Larry Swedroe: [US] public pensions 98% certain to underperform benchmarks over ten years [Passive maths; also I don’t think you can be ‘98% certain’ but then I’m just a humble aggregator… 😉 ]The Evidence-Based Investor

Naughty corner: Active antics

The stock market as entertainment in the Covid-19 era – Net Interest

Investment in oil supply has collapsed. It may not roar back – The Economist

TINA + MMT = MAMU – Ed Yardeni

How to measure dividend growth and the factors that support it – UK Value Investor

A walk on the wild side – Simple Living in Somerset

Active investing ability declines markedly in those aged over-70 – Market Watch

Investment grade corporate bonds right now: the worst risk/reward in history? – Charlie Bilello

Covid-19, politics, and Brexit

London still the worst-hit UK region for excess deaths from Covid-19 – John Burn-Murdoch via Twitter

Deaths involving Covid-19 by local area and socioeconomic deprivation: March to May – ONS

New daily infections fall by half in a week, implies data from the symptom tracking app – Symptom Study

Coronavirus came to the UK at least 1,300 times, mostly from Europe; just 0.1% from China – BBC

Why it will be hard to introduce local lockdowns in the UK – Wired

Coronavirus bubbles: The great housemate sex dilemma – BBC

Growing calls for 2-metre social distancing rule to be halved to support the economy – BBC

America is giving up on the pandemic – The Atlantic

Could a vaccine be developed for Covid-19 in record time? [Experts discuss]New York Times

There’s a lot of confusion around about asymptomatic coronavirus cases – Stat News

How the pandemic might reshape the world’s cities – The Atlantic

Boris Johnson’s team is broken by the virus and losing faith – Bloomberg

Kindle book bargains

The Anti-Procrastination Mindset by Harry Heijligers – £0.99 on Kindle

The Perils of Perception: Why We’re Wrong About Nearly Everything by Bobby Duffy – £1.99 on Kindle

How To Day Trade For A Living by Andrew Aziz [Wealth warning!] – £0.99 on Kindle

The Spider Network: The Wild Story of a Maths Genius and One of the Greatest Scams in Financial History by David Enrich – £1.99 on Kindle

Off our beat

The Museum of Office Life, and other stories from the future [Funny, video]YouTube

Underworked but exhausted? That’s not burnout, that’s ‘boreout’ – Guardian

$1 billion to save the ocean [YouTube]The Economist

How to feel better when you don’t know what’s wrong – Raptitude

The depth of privilege – Of Dollars and Data

And finally…

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.”
– Charles Dickens, A Tale Of Two Cities

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  1. Who is making all these screens? There’s a Covid-19 winner for sure. []
  2. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. []

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{ 56 comments… add one }
  • 51 Vanguardfan June 19, 2020, 9:32 pm

    @sparschswein do you have a link to that Nature Medicine study? I can’t tell what the numeric proportions are from my anecdotes but there are certainly people who had symptoms (‘mild’) who have not converted. I hope we see some published results from the NHS antibody tests, as the sample would be pretty big and would include quite a lot of PCR trusted people.
    I agree with your final conclusion re likely infection prevalence. We shouldn’t be trying to invent explanations to fit our hunches. And I think people are underestimating the effectiveness of social distancing behaviours, whether voluntary or mandated, in slowing transmission. The infection has declined because we have changed our behaviour, not because it has stopped finding susceptible people.

  • 52 Sparschwein June 20, 2020, 12:55 am

    @Vanguardfan – I mean the paper that @TI has linked to in a previous post
    And this is the Lancet paper

    Yes it’s really the most straightforward explanation that social distancing has just worked as expected. There was a long-ish article in the FT with data series week by week, it showed that people started changing their behaviour in early March, weeks before the official lockdown.
    And the warmer weather may have helped because most transmission seems to happen in confined indoor spaces?

  • 53 vanguardfan June 20, 2020, 9:56 am

    Thanks for that. The Nature sample is quite small, but interesting. Notably 40% of the ‘asymptomatics’ became seronegative within 8 weeks of discharge. Since we’re now three months from our peak infection rate, quite a few of the HWC may have become seronegative. Of course, the million dollar question is what happens when they next meet the virus.

    Yes, I’ve always felt we would muddle through the summer without major surges – and of course remember we are still legally forbidden from social gatherings indoors. The change to cool damp weather and possibly lifting of indoor gathering restrictions are both likely to be significant challenges.

    All roads back to ‘normality’ or at least a semi-functioning society lead through the nexus of track, trace and isolate – until we know where infections are occurring in real time we will never be able to target distancing measures adequately. Unfortunately since pillar 2 (privatised) testing still seems unable to even identify how many individuals have tested positive, let alone where they live and work, we are very far from being able to abandon population level distancing. I cannot understand the government’s wilful reluctance to focus on the local information and feedback loops that are necessary for controlling the epidemic.

  • 54 Snowman June 20, 2020, 10:26 am


    Thanks for the explanation of why you thought the study result was unfortunate, I see where you are coming from now.

    As you realise I was looking at it on the basis that further evidence that a significant number of those who had had the virus had no detectable antibody response, would mean the serology tests understated the true percentage of people in the potential immunity pool. And that would be would be a good thing for community immunity hopes. But as I say I see where you are coming from.

    The study shows that 81.1% of the asymptomatic had detectable IgG antibodies in the acute phase. But that IgG antibodies waned and only 40% of the asymptomatic had detectable IgG antibodies in the convalescent phase (the diagram in figure 3e of the paper shows the results very clearly). It would be interesting to know if that 40% might reduce further after the covalescent phase.

    IgG antibodies are the long term antibodies that remain in the blood after an infection has passed.

    Is that where you get your quote Sparschwein that ‘The new Nature Medicine paper shows that >80% of asymptomatic infections result in detectable SARS-Cov-2 antibodies.’ based on the detectable antibodies in the acute phase?

    If so, given that most serology studies will be done in individuals where most are past the acute phase, then that does mean there are a significant group of asymptomatic people who would have tested positive (or have tested positive) for the antigen but who don’t have a detectable antibody response. Add in those who would never test positive for the antibody but have encountered the virus then that further increases the potential ‘immunity pool’. And further research urgently needed and all that.

    So I don’t understand the comment ‘So the serology results are conclusive’ based on the results of that paper.

    Interestingly the latest (week 25) English regional serology (antibody) prevalence levels seem to show reduced sero-prevalence in all areas apart from the North-East (see fig 29). They have explanations for this such as changes in locations of sampling, but it does look odd to me.


  • 55 Snowman June 20, 2020, 12:10 pm

    Another mistake! Should have said 60% of the asymptomatic had detectable IgG antibodies in the convalescent phase (not 40%)

  • 56 Sparschwein June 20, 2020, 3:44 pm

    @Snowman – good point about the observed decline in Ab levels. I don’t think it changes the serology results because of timing. The Nature Medicine study re-tested for IgG “8 weeks after they were discharged from the hospital” (they were quarantined). Hence 2-3 months after infection one might miss ~40% of asymptomatic positives; but the pandemic only started in Europe in Feb so there was not enough time for a significant decline.

    As always, one would want to see >1 study showing the same thing, and these results fit with the Lancet cruise ship study (8/8 asymptomatic IgG-positive) and Aguzzi’s Switzerland study, that I rate very highly, also found 4/4 asymptomatic IgG-positive.

    > “Add in those who would never test positive for the antibody but have encountered the virus”
    Exactly these people are *included* in the Lancet and Nature Medicine studies, and the data shows this group is <20% of all infected.

    Now the asymptomatic sample numbers are still rather small and we'd like bigger studies.
    But it's pretty strong, direct evidence from 3 independent papers.

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