Wealth update – 31/07/2021

The market has closed for this month and I have counted my beans. Here’s my update for July.

Deposit drama

It seems we are legit taking our previous landlord to court over their failure to protect our tenancy deposit in time. They never responded to our letter before action (other than acknowledging it).

I prepped all the forms and evidence etc and we posted that to the local county court more than a week ago. However, we haven’t heard back. I don’t really know whether we should give the courthouse a chaser? I’d rather avoid that. Let’s wait and see!


The month has been relatively quiet:

  • I’ve been to the office a few times but mostly work from home. I even met a client or two face-to-face.
  • The family (including the puppy) went to Dover and more recently to Broadstairs. Nice little day trips!

Counting my beans

July was a positive month and not too bad. My net worth as of 31/07/2021 was £249,793 (sadly it dipped below £250K) – it’s an increase of £17,203 (more or less my annual expenditure) or 7.4% from the end of June 2021. This is after me making a £1,600 GIA top-up and £411 pension top-up (deducted from salary + employer contribution).

All in all, a decent month!

The curse of the bearish case

Markets are at an all-time high. Everybody is making money and I just had my best month ever (see previous post). Now what?

A critic would say that this is not sustainable and the markets are in a bubble. They can’t possibly go any higher as the PE ratios are so high, earnings are too low, insane valuations, interest rates are about to increase, inflation is coming, governments will raise taxes to pay for their Covid-19 expenditure etc.

Bears strike downwards with their claws which is why it’s said that markets are bearish when they go down.

Yes, there’s lots to be concerned about.

A bull strikes upwards with his horns which is why it’s said that the market is bullish when it goes up.

The positive spin would be something like this: the world is re-opening, the pandemic will be over or we will all learn to live with Covid-19, mRNA and CRISPR will be used to treat countless other infections and diseases, a cancer cure will be found this decade, we will all transition to sustainable energy production and battery storage technology will make many breakthroughs, automation and AI will significantly improve our quality of life, the 4-day work week will be the norm, anybody anywhere on the planet will have access to 5G internet speeds (Starlink), the future will be spectacular and the stock market can only go up.

You are probably thinking that the bearish case sounds more reasonable than the bullish case. And that, my friend, is the curse of the bearish case – it always sounds smarter.

The bullish case sounds a bit like pie in the sky and is just too rosy. It doesn’t sound that smart and is harder to believe.

If you listened to the media and got out of the market whenever someone said a crash is coming, you’d most likely be broke. Or, at the very least, you’d be significantly worse off.

I remember reading an academic study into the profitability of the clients of a brokerage company. Collectively speaking the best performers were accounts of deceased people or people who forgot their logins and weren’t able to make any investment decisions. Most people don’t know what they’re doing and they are shooting themselves in the foot when they trade. Investing is like any other skill – you need somebody to teach you, otherwise you can make very expensive mistakes.

I’m a believer in passive investing (buying index-trackers) but know that there’s a place for active investing and hedge funds etc as well. You do you. There’s millions of ways to make a profit – find out what works for you and do that.