investing etc. 0014

General Election edition. Also: Chilling in the fjord, Anpario, Churchill China, Dewhurst, Halma, Pets at Home, Porvair, RS, YouGov, calculating Return on Total Invested Capital (ROTIC), The Dropout

I am writing the 14th edition of investing etc. the afternoon after the general election. We have a new government, my head hurts, and so does the rest of me. 

Hope is where the party is

I went to bed at 5am, just after our former prime minister used his re-election speech to apologise for his party’s performance.

By that time I was the last person standing (actually, I was lying on a yoga mat covered in a blanket with my head propped on a foam roller. The crucial point though, is my eyes were open at least intermittently). 

An old school friend was lightly snoring in a seat behind me. Everybody else had quietly let themselves out or crawled off to a bedroom or makeshift bedrooms in the office and the spare room.

We must have been a curious sight, solitary figures in a room dressed in bunting made from political pamphlets of all colours and littered with half empty drinks, bowls of food, and the day’s papers.

The bunting’s come down, the beer cans are in the bin.

For the eighth consecutive election since 1997, we hosted a party. At the first one, only one of my three children was born and he would have been asleep in a cot. 

All three came last night. It was not compulsory, two of them had to travel some way. 

They came with partners and friends, and for the first time, they were all old enough to vote. There was an almost even split between the grey(ing) vote, a smattering of old friends, and youth.

There was no count, but I am confident 100% of our election party voted, a much better turnout than the 60% who voted in the general election or the 71% who voted in our constituency. 

Our house is near the end of our village, and many said they had voted en route. The notion that the act of voting might in some people’s minds be connected to a pilgrimage to our party, is a quiet source of satisfaction.

You might conclude that we are a political family, and so are our friends. Far from it.

Activists, I imagine, would have somewhere better to be than our house on election night.

As we watched politicians making speeches in victory and defeat, the words of a friend who did not come to the party came to mind. He was disinterested in the election, perhaps angered by it, comparing it to “sheep voting for their slaughterer”.

Similar opinions are available, politicians are, after all, “all the same”, and “in it for themselves”. 

The politicians I watched on TV did not look like slaughterers. Some were a bit sheepish. And I wondered if my friend had stayed up (nearly) all night to witness the last eight elections, he might not have been so disaffected. 

Maybe Jeremy Hunt is destined for political obscurity. He narrowly won his seat, but his party lost and he is no longer Chancellor of the Exchequer. I will remember his dignified words though.

The first election party was a one-off. It came about because it was a good excuse for a party and I reckoned if we invited enough people, some would stay and keep me company as the morning wore on. 

But it is now a mechanism that keeps me interested in politics even though some of the idealism of youth may have passed. It has helped to prevent the onset of cynicism. 

Maybe it has played a small part in encouraging some of the newest generation of voters to be occasionally interested in politics too. 

Some of them may be reprehensible, but while we have politicians to vote for and election parties to organise, I will hope. That is how I felt this morning, when I woke up three hours after going to sleep. 

I hope the new government will lead. Instead of promising impossibilities and failing, I hope it will explain the hard trade-offs it must make and achieve them. 

I hope progress will reduce the level of cynicism in voters and especially non-voters, and inspire more people to take an occasional interest in politics.

Our new prime minister did not inspire me to vote for his party this time. Labour does not get a look-in here anyway, so he had a mountain to climb. 

But I felt hopeful watching Sir Keir Starmer’s speech outside 10 Downing Street, when he talked of a government of public service. And I felt more hope as I read about his Cabinet appointments.

You may be wondering what the link to investing is, in this election edition of investing etc. 

I cannot tell you whether the new Government will be good or bad for shares.

My policy is to own shares in businesses that should do well through thick and thin. Whatever the future brings short of catastrophe, I expect them to prosper.

But a thriving democracy fosters a thriving and productive society. The degree to which our investments prosper is dependent in part upon the choices we made last night.

Northern light

If you came for the investing insights and got this far, thanks for persevering. There is investing to come, but first...

Since investing etc. 0013, we spent midsummer on the island of Møkster in Norway. It is about an hour and a half trip by speed ferry from Bergen and then a slower ferry from Hufthamer. Møkster is tranquil, crystal clear waters lapped against the rock beneath our Airbnb, and porpoises cruised the fjord.

The island has one shop, two rental properties and 33 permanent residents. Many of them took a keen interest in us, and our idiosyncratic habit of stripping down to shorts and a T shirt whenever the sun came out. 

The view from our Airbnb (which deserves its ***** rating) at 5.30am on the day we got up super-early to catch the ferry home.

Despite election parties and island holidays, I have been writing...

• A first look at Pets at Home, with apologies to London Security and Science

• Halma and RS show elephants can gallop, or at least trot. An appendix demonstrates how to calculate Return on Total Invested Capital, perhaps the most important financial statistic to judge acquisitive companies by

• YouGov and Porvair re-scored

• A double trade in the Share Sleuth portfolio: Churchill China and Dewhurst

• Natural animal feed additive manufacturer Anpario scored.

Thanks for reading

Browsing through iPlayer, we stumbled on The Dropout recently. 

There are lessons for investors and entrepreneurs in the dramatised story of Elizabeth Holmes and Theranos, the blood testing firm she led to fame and ignominy. We’re three episodes in, and it’s thumbs up for entertainment as well as educational value.