In War or Peace - Further Commentary

25 June 2025

To all Financial Friends

There has never been a more important time to make your money work for you and to be specific about the assets you hold.

Thank goodness there is always profit to be made in the markets whatever the circumstances are - especially if investors are careful and quite specific about their choice of assets. The world is unnervingly upside down and so is the world of money! In the Chancellors spending review on the 11th of June we are set to borrow an additional £200 billion of debt. Ostensibly this is for growth projects to stimulate our UK economy. Turns out that £80 billion of this figure is to cover the high interest payments on the increased borrowing! So we are left with just £120 billion to invest for growth to save our economy.

Now we are to spend millions on nuclear deterrent bombers from Donald Trump and see our defence costs to protect us rise to 5% of our Gross Domestic Product (GDP)

In my recent commentary I wrote of moving from a 'welfare economy' to a 'war ready economy' Tonight our Prime Minister talks openly about having to "actively prepare" for the potential of a "wartime scenario." I would encourage you, if you will, to read the last commentary again and consider where you want your money inside and outside of your pension funds  to be in today's world.

Strategies for today?

The defensive strategies of the profit taking' strategy and the accumulation strategy that some students have adopted may now appear even more appealing. I would be surprised if other commentators shortly fail to be highlighting assets we have  already supported for students who were of the more cautious viewpoint. Such assets carry the title of Gold, Infrastructure, Defence, Consumer Staples and Money Market Funds.

A little research into the second world war highlighted gold and (if they were available then), Inflation linked bonds, as assets that that did and would have performed well even during time of war. Of course war is very different now with technology playing a leading role but the inflationary effects of war and even now the threat of rising oil prices need consideration.

My appeal and comment to our students is to be aware that the welfare state may prove to be unable to support us in the way we feel it should. This, before the now awareness of potential wider war. The underlying message is to make your money grow as you will need it to take you through the next passage of time.

For those wanting to consider defence stocks  as a part of your current portfolio your research might contain funds available on A J Bell and other platforms. Such funds are found under the heading of Exchange Traded Funds with varying charging structures. Please ask for further details if this sector is of interest to you.

Ready to support you with information and guidance together with our growing team of expert professionals as outlined in the last commentary.