At university I studied Economics. It was a Bachelor of Science degree course, meaning it required studying mathematics and statistics. As a result, I have just enough knowledge of both, to be regarded dangerous!

To top it all off, my main focus was financial economics. I wrote my dissertation on comparative monetary policies between Germany (the good old days of sound money practised by the independent Bundesbank and the Deutsche Mark), Japan and the US . My tutor thought I put in a reasonable effort and did not screw up too badly!

The funny thing is that I only really understood what I was writing about after having worked as a commercial banker for about 5 years! It was not the theory as practised by central bankers around the world, but the practical application of monetary policy in the form of bank lending that led me to finally figure (some!) things out!

Some Financial History.

You could of course argue that I am particularly thick and slow on the uptake. And you may not be wrong. However, looking at my fellow students, I may not be that unique.

Yes, one of my fellow students made it to billionaire status investing in the stock markets. A few others got independently wealthy whilst employed by brand name financial institutions to flog the latest investment trend to other institutional investors. Many more, however, became nameless white collar worker bees just like me.

Since leaving secure employment nearly 20 years ago, I have started and failed at 4 different businesses. From the financial services industry to Asian real estate, and training physical security personnel to management consulting.

My heart, however, remains with finance. My experiences with lending money to retail and corporate customers, managing funds for wealthy individual clients, raising money for my start-up companies, and facing investors when the shit hit the fan, all form part of my experience and understanding of financial markets.

Stock Market Crash - 1987.

I experienced the stock market crash of the late 1980s as a student. Try finding a job straight out of university when your industry of choice is getting rid of staff, and nobody is looking to hire fresh graduates!

Asian Financial Crisis - 1997.

For the Asian Financial Crisis of the late 1990s, I had a frontline seat. The bank I worked for had a large Asian exposure and it was quite challenging to manage not only the investments but also the clients. If you think professional investment managers are cool under pressure, think again!

Dotcom Bubble - 2000.

The dotcom bubble bursting in early 2000 continued on with the same theme. Managing the imploding investments was one thing. Managing irate clients another. In many cases it was those exact same clients who forced us to invest in highly speculative investments in the first place. When it all went pear shaped, they blamed us for not protecting their rapidly depreciating assets!

A very human response when facing failure and losses is to look for someone, anyone, to blame but oneself.

Global Financial Crisis - 2007

The Global Financial Crisis hit me in a slightly different form. In 2006 I blew up my own private investments by not risk managing my exposure in a timely manner. I had a highly leveraged position on and had given limit orders to take me out entirely. Only half my order was filled though. The other half was enough to sink me. The challenges of trading US markets from Asia when telephone orders were the only way to get filled!

To get over this setback of becoming independently wealthy by trading my own portfolio, I partnered up with a couple of guys and we looked to raise funds through listing a niche Asian real estate fund on the London Stock Exchange.

It is challenging listing a company on a stock exchange during normal times. It takes a lot of time, and money, to get this done. We had done all the legwork and were about to start selling our company to potential investors in London when one of the first victims of the Global Financial Crisis went bankrupt. A large UK building society, Northern Rock, closed its doors.

Not a good sign. And it went downhill from there. When we were meeting with US investors, the headlines of the financial press were dominated by defaults in the mortgage backed securities market. Lehmann Brothers cast a long shadow.

The end result was a cancellation of our listing process, along with plenty others. If I recall correctly, no company listed on the London Stock Exchange for the remainder of the year.

Another lesson learnt!

Buy Panic. Sell Hysteria.

My point of telling you all this is simply this. The current bear market in, well nearly everything, is not unusual. There is a huge fundamental problem with bull markets. No matter what the underlying asset is.

Any bull market makes stupid people look smart.

Especially in something as new as crypto.

The crucial thing is to have an investment plan. Preferably one that you have back tested. And then stick to it. Let FOMO and FUD be the other guy’s problem!

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