Dread Chaos and Eternal Night

Victoria, November 2017.

Disruption is a word that only has negative connotations for me and I  expect digital disruption to be the prelude to war. Apparently now it means improvement. I snapped the sign above in Victoria this month.

Whatever your opinion on leaving the EU it seems inevitable that it will cause significant short-term disruption. If this is accompanied by a left wing labour government the UK really will be in trouble. Businesses that would have remained in the UK to benefit from low Corporation Tax will pack their bags to avoid Corbyn’s promised tax rises. Many rich individuals will make the same choice and the government, having promised increased spending, will have less tax revenue to pay for their policies. They will borrow more, the UK credit rating will suffer, interest payments on government debt rise leading to “dread chaos and eternal night”.

On a happier note, Caledonia Investments have sold The Sloane Club. At the end of September they valued it at £62.7 million, their fifth biggest investment. Earlier this month they sold it for £80.6 million giving some idea as to how much unrealised value there is in their unquoted holdings. The share price does not reflect this – it is trading at an 18% discount. This contrasts with RIT (Rothschild Investment Trust) that trades at a premium of more than 6%. It’s seldom sensible to pay a premium for an investment trust but I like the way Lord Rothschild’s mind is working. Here is an article from The Times published in August 2017.

The Times, 15th August 2017.

While RIT has under-performed more bullish fund managers, when the music stops it will not hit the floor with a bump. I am a pessimist, cheer me up, “one dim ray of light indulge”.