History, be kind
Icannot forecast to you the action of Russia. It is a riddle wrapped in a mystery inside an enigma. Not my words, of course, but those of Winston Churchill: a line from the first instalment of six massive volumes recording the history of World War 2, published in 1953.
Nearly 70 years later, the quote rings as true as ever.
On the first day that Russian missiles started raining down on strategic targets in Ukraine last month, I wrote a note to clients stating that I had nothing to offer in terms of how this war might play out. Will it be short or protracted? Will Russian President Vladimir Putin achieve his grand ambitions? How much damage will be done? How far might the market drop? I had no idea. I still don’t.
In that same piece, I also reminisced about some other events of historical proportions over the years.
First, there was the start of Operation Desert Storm in January 1991, marking the official retaliation of the West in response to the invasion of Kuwait by Iraqi forces. Even though the Gulf War actually started more than five months earlier when Iraq first sent troops across the border, it only became “real” for me when President George Bush made an address to Americans, informing them that the US was about to respond with force.
I have a vivid memory of this bit of history. I happened to be studying in the UK when all of this played out, and the Bush address was scheduled to take place around midnight my time. I stayed up, made popcorn, nestled in front of my small black and white television set and watched the whole speech live.
It felt like the world might end. But of course, it didn’t.
Then, 10 years later, there was the fall of the Twin Towers. I left my office early the day it happened and met a few colleagues for a drink. The mood was understandably glum.
More than ever, it felt like the world might end. But of course, it didn’t.
Seven years passed before I once again experienced emotions which compared at least to some extent to these momentous events. This time there was no act of war: it was a mere financial crisis. Lehman Brothers collapsed in September 2008 after being in business for 158 years. Merrill Lynch was rescued by Bank of America. Citigroup’s share price fell by 95%. The global banking system seemed to be closing down.
It felt like the financial world as we knew it was about to end. But of course, it didn’t.
I tried to draw inspiration from these memories as I watched on live television how the war in Ukraine broke out.
It helped that I saw a tweet by David Ingles, host of the China show on Bloomberg TV, who said the best investment strategy in response was to log off, go across the street, have a nice long meal, go for a quiet walk, head home, call or hug your loved ones, sleep for 10 hours, and be thankful for doing all that, because right now a lot of
people can’t.
I couldn’t have put it better. I have reread these wise words a number of times in the past four weeks.
It may feel like the end of the world to some people once more, but I keep my eye on the future and look forward to the end of this war and a return to normality. Just don’t ask me how long this may take; I’ve read everything I can about the situation but it’s all still a riddle to me.
Who really has an any idea what will happen next? It’s OK to say you don’t know. As Josh Brown from Ritholtz Wealth Management in the US asked rather cynically in a recent blog post: why on earth should your financial adviser “who works in the strip mall next to PetSmart” have any view on when this might all blow over?
In this context, there is another famous quote, often misattributed to Churchill, which deserves to be mentioned: “History will be kind to me for I intend to write it.”
Said differently: he who wins the war ends up writing the history books (as Churchill and his six-volume account eventually proved).
All of which leads to the question: who will end up documenting how the war in Ukraine eventually unfolds? Might history yet be kind to Ukrainian President Volodymyr Zelensky?
It felt like the financial world as we knew it was about to end. But of course, it didn’t