Good morning. I am Phil Rosen. Good to see you on a Saturday.
As you might guess for a journalist, I always seek to speak with fascinating people with unique insights. These conversations become all the more rewarding when I can share them here in this newsletter.
So who do I talk to next? Tweet me @philrosenn or write to me at prosen@insider.com with proposals.
It’s been a year since Russia launched its invasion of Ukraine, and today I’m sharing my conversation with a senior investment executive who, before his career in finance, worked as a journalist in Moscow.
He anticipates the war continues until 2024.
If this was forwarded to you, register here. Download the Insider app here.
Rhys Williams, chief investment officer of Spouting Rock Asset Management.
gushing rock
Rhys Williams is Chief Investment Officer at Spouting Rock Asset Management. He is also a former Moscow-based reporter for the London Sunday Times.
This conversation has been lightly edited for length and clarity.
Phil Rosen: What are the implications for financial markets of Russia’s war on Ukraine?
Rys Williams: A long war is priced, that’s what everyone expects.
We can all cheer for Ukraine, but if Ukraine starts to win, it increases the risk of tactical nukes and China is getting more involved.
If Ukraine really starts to win, it becomes risky for the market, but if Russia wins, it also makes the markets very nervous. I think both cases are unlikelyand that a dead end is the likely case, which has more or less been built into the price.
There will be a liquidation of stocks and probably a flight to bonds in a scenario where Russia either wins big or loses big.
Beyond the markets, how would you characterize this war?
RW: It’s an existential war for Vladimir Putin. It may not be in Russia’s interest to continuebut Putin is all for it.
It is absolutely impossible for Putin to appear on national television and say he made a mistake. He pledged to gain ground.
Now, with the stock market pushing back on the Fed to start the year, how do you see this year going for equities?
RW: The chances of another 2022 are very low. Things will really have to break terribly for that. But the chances of the market being up 30% are also, I think, low.
I think the market is quite valued and the type of companies that can grow and no need for a great economy should do relatively well.
Here is the full story of my conversation with Rhys Williams.
What do you think of Williams’ ideas on markets and the Russian-Ukrainian war? Tweet me @philrosennor write to me prosen@insider.com.
And here are the top stories from the markets this week:
Xinhua/Wang Ying/Getty Images
1. Retail investors are crowding into the riskiest parts of the market. Reddit-loving day traders are back in full force, racking up record amounts of cash in stocks to start the year. But strategists warn that the enthusiasm can be misconceived.
2. Insider’s Kathleen Elkins has interviewed countless college students about money over the past four years. Many of them have no idea how compound interest works or how to profit from it, she explained. Here are the most important personal finance concepts that should be part of everyone’s education.
3. Ray Dalio will secretly receive billions of dollars from Bridgewater for agreeing to retire without a fight. The New York Times reported this week that the hedge fund had arranged to pay Dalio to step down after six months of negotiations. The billionaire founder of the $150 billion company stepped down in October, but retained his place on the board.
4. In a recently resurfaced clip, Tim Ferriss asked Warren Buffett how he would invest $1 million if he did it again. The Berkshire legend Hathaway’s advice to the podcaster in 2008 was to put the amount of money in an index fund, “Forget it and get back to work.”
5. The stock market was turned upside down. Jerome Powell insisted that more rate hikes are on the way, but investors are taunting the Fed with high speculative bets. Here’s what you want to know.
6. Adidas has just had its debt rating reduced by S&P. The sportswear brand will have a harder time making payments now that it has severed ties with Kanye West, S&P said. The company warned it would lose $1.3 billion when the partnership ended.
7. JPMorgan has restricted the use of ChatGPT by merchants. According to a report by The Telegraph, the bank has restricted staff members of the viral language bot, as he fears the tool could share financial information that could lead to regulatory action.
8. The Mormon Church and its investment arm will pay $5 million to settle the SEC charges. The regulator said the Church’s investment manager “has gone to great lengths” to avoid the disclosures. Its most recent 13F filings show the Church has a $100 billion portfolio.
9. This fund manager outperformed 95% of its peers last year. He shared a list of 16 stocks that can help investors collect consistent cash payments while inflation remains high. See names.
10. Meet a real estate investor who owns 1,250 units and was able to retire at age 36. Dave Allred was able to stop working just 13 years after buying his first property. Here’s how he was able to “reverse” his financial freedom.
Organized by Phil Rosen in New York. Feedback or tips? Tweeter @philrosenn or email prosen@insider.com
Edited by Max Adams (@maxradams) in New York and Nathan Rennolds (@ncrennolds) in London.