Like many of us, Howard Marks has been at home for two months. It has given him plenty of extra time to be philosophical about markets, and it is reflected in a memo which poses more questions than answers.

He admits with some frustration that many economic forecasts vary significantly when presented with exactly the same facts and assumptions. He quotes economics consultant Neil Irwin:

“The world economy is an infinitely complicated web of interconnections. We each have a series of direct economic interrelationships we can see: the stores we buy from, the employer that pays our salary, the bank that gives us a home loan. But once you get two or three levels out, it’s really impossible to know with any confidence how those connections work.”

And Ian E Wilson, former Chairman of GE:

“No amount of sophistication is going to allay the fact that all of your knowledge is about the past and all your decisions are about the future.”

 

Read the full summary of his latest memo dated 11 May 2020, titled simply 'Uncertainty' on Firstlinks here.