“The future is already here now, it’s just not evenly distributed yet.”
What scares me the most is the rising number of statistically-significant flash points in financial markets in recent months. This highlights to me that something is amiss: a 40% intraday move in the Swiss Franc, the collapse of oil and the breaking of the uptrend since 2002, the bund crash, the flash crash, China markets plummeting the most since the 1990s and then yesterday the NYSE seized up for 4 hours. What was this? What concerns me about the next financial market crisis is that liquidity occasionally dries up and things like this happen. If this happens after a very bad economic number or another plummet in a globally significant market like China, we could easily see another 1987 style meltdown in developed nations’ markets like the US. This NYSE event highlights the fragility of markets here and the presence of so many algo traders and “flash boys.”
Wednesday and Thursday, I sought refuge from the noise in the Central (Hong Kong) and the volatile China markets, by the beach on the south side of the Island. The views of the calm ocean, the many islands of the South China Sea and the big container ships in the distance, edging their way slowly across the vista, are always breathtaking. The other people on the beach seem to be students, an occasional tourist, and retirees. Once I do my morning qi gong I go and read and write from the adjacent al-fresco restaurants. Here one can see mainly housewives with children pushing prams whilst their husbands work in Central. I have been an entrepreneur and self-employed since 2008, apart from the folly of once going back to a bank for 12 months or so (that didn’t work out for either of us too well!). So I am used to being in the quieter spots of Hong Kong on weekdays. Often I get that inquisitive look – is he a tourist or just unemployed? Occasionally someone asks whether I am a writer – perhaps when I have a creative look on my face! Who knows. It’s fascinating how strong stereotypes are. I should be rushing to the office with the rest of the pack, apparently. But I have already done that, and earned my stripes in the world of investment banks and hedge funds. However it wasn’t my destiny forever, although I am grateful for the learnings and mentorship I received over the years. Now I need space in order to be most creative and effective. Space is one of the most underestimated requirements for business – or anything. In my precocious youth I remember boasting to a friend and his girlfriend how many books I consumed. Politely, but possibly unimpressed, my friend’s girlfriend (the astute daughter of a diplomat) quizzed me as to how much of my time I dedicated to digestion and reflection on all of these books. The answer was, of course, zero. I just moved from book to book with a voracious appetite for knowledge. But knowledge is not insight. In fact knowledge is arguably just someone else’s ideas. Now I take space quite seriously in both my role as a futurist and business man, but also as a human being. As Socrates said, the unexamined life is not worth living. In the midst of the current mayhem of markets, it would seem doubly important, even though it’s the last thing investors want! Find your beach, that place of silence and reflection, even if its just a metaphorical one! A quiet park or even a Church. I assure you, you’ll make better decisions.
[This Chronicles of a Futurist is an excerpt from my weekly editorial at Dow Theory Letters, where I am honoured to write alongside Wall St legend Richard Russell. You can do a free trial here – http://www.benjaminjbutler.com/dow-theory-letters.html]
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