Hello, hello!
It’s the last day of March 2022.
PEACE TALK
There was some progress in the peace talk between Ukraine and Russia as Russia pleaded that it will "drastically reduce" military combat operations in Kyiv of Ukraine. Most of the western media still have some doubts over this positive progress and some believe this may be a "smokescreen" for the Russian forces to re-strategize in Ukraine.
YIELD CURVE INVERSION
Bloomberg on 28.03.2022 reported that the spread between five-year notes and 30-year bonds inverted for the first time since 2006 when five-year yields rose to 2.63%. Why is this pertinent?
The inverted curve has proven in the past few past major occasions to be relatively reliable lead indicator of a recession. Then,what is “inverted yield curve”?
Investopedia explains that “an inverted yield curve occurs when short-term debt instruments have higher yields than long-term instruments of the same credit risk profile”. It further explains that “an inverted yield curve is unusual; it reflects bond investors' expectations for a decline in longer-term interest rates, typically associated with recessions.”
It this a reference or sign of recession? I do not know.
On top of that, inflation is real even before the Ukraine Russia conflict. And we can feel the impact of inflation now. The cost is that our money is declining in true value over time.
MY INVESTMENT
Having said that, I am maintaining a long time-horizon buying dips in the assets and businesses that I want to hold for the next decade.
Quoting Benjamin Graham, "In the short run, the market is a voting machine but in the long run it is a weighing machine."
PORTFOLIO
These three (3) months have been a roller coaster riding. Current month for March 2022 our portfolio is up 4.19%. However the overall performance for this year is still down 5.18%.
Stay safe.
MNMLH
31.03.2022
