Are Public Markets Back? | Merryn Talks Money

Gold is best viewed as portfolio insurance — a meaningful allocation (circa 10%) makes a difference in stress scenarios; recent falls are a healthy momentum unwind while structural drivers (Asian buying, fragile debt/inflation backdrop) remain supportive. Meanwhile, a reversal of long-term de-equitization (large IPOs, companies raising equity) increases public-market supply/liquidity and re-establishes capital markets as a venue for funding growth — good for transparency and inclusion but may blunt aggregate returns. In the UK, inheritance-tax-free bonds could attract savers, be politically popular, and reduce government borrowing costs.

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Oil

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USD

public markets cautious up

Bloomberg 7.0
Financial Media
Merryn Somerset Webb 6.5

Are Public Markets Back? | Merryn Talks Money

Gold; UK bonds

metals

Both hosts agree gold's recent correction is healthy and structural drivers (Asian buying, debt/inflation) remain supportive; they advise sticking with gold positions, implying a cautiously bullish medium-term view.

ndx

The discussion focuses on increased equity supply (IPOs, secondary offerings) which could blunt returns; no explicit bullish or bearish call on Nasdaq, but the tone suggests a neutral-to-cautious view on broad equity indices.

rut

The hosts discuss increased IPO activity and public market listings, which could benefit small-cap indices like the Russell 2000; the tone is positive about capital markets reopening, implying a cautiously bullish view on RUT.

yields

The hosts discuss a new IHT-free bond that could reduce UK borrowing costs, implying yields could be lower than otherwise; however, the broader context of inflation and debt suggests yields may remain elevated.

Merryn Somerset Webb

Gold is impossible to value; the key is to have enough to make a difference when something goes wrong (circa 10%) but not so much that it drags performance in normal times.
John Stepek

5% gold is not enough insurance; 10% feels correct; 20% is too much because gold sits stagnant while other assets rise.
Merryn Somerset Webb

Gold's recent fall from above $5,000 to below $4,300 is a healthy correction; structural drivers (Asian central bank buying, debt/inflation backdrop) remain supportive.
John Stepek

Gold's momentum has faded but Asian money is still buying; the debt picture hasn't improved, especially in the US, so fundamentals haven't changed like in 2011-2012.
Merryn Somerset Webb

The equity market has experienced de-equitization (shrinking supply of shares/companies) for two decades, which has been a driver of the bull market via buybacks and private equity takeouts.
John Stepek

Fewer shares means higher prices, just like fewer apples at the supermarket; it's logical but abstract.
Merryn Somerset Webb

We are now seeing a reversal: huge IPOs (SpaceX, OpenAI, Anthropic), companies like Google raising $85B in debt, and private equity being forced to sell — increasing public market supply.
John Stepek

Higher interest rates make private capital expensive, closing the disparity with public markets; companies with changed risk profiles (e.g., hyperscalers facing AI competition) prefer equity over debt.
Merryn Somerset Webb

A new UK government bond whose proceeds are inheritance-tax-free could raise money for defense, be politically popular, and reduce the UK's borrowing costs.
John Stepek

Inheritance tax take is only ~£15B/year; even halving it would be offset by lower borrowing costs; the idea has almost no downside and could be called 'patriotic bonds'.
Merryn Somerset Webb

UK investors are so desperate to avoid inheritance tax they buy risky AIM stocks; they would readily accept a slightly lower yield on a safe IHT-free bond.

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