Never before have I seen so many polar opposite forecasts as I am seeing now. I agree with people with whom I never agree (or respect, in some cases) and I disagree with people with whom I usually agree (and respect a lot). But then again, not all of them on both sides.
Some say healthcare is the way to go yet I panned hospitals a few weeks ago.
Some say tech will carry the bull but I panned it a few weeks ago.
Some say bear market to new uncharted (at least not in the past 50 years) territory and others say a new major bull market is underway.
The VIX at 27 is a good thing while some say it is not good at all.
Some say sell in May while others look for the summer rally
Some say inflation while others say deflation (funny, nobody talks about benign ole' disinflation).
Some say the consumer is coming back and others think he/she is still scared poop-less.
Some say the government is fixing things while other say they are making it worse.
You say tomato, someone else says tomatoe. You can keep your to-mah-to.
What the deal? Who knows? Nobody knows but that is no excuse for investment paralysis. I called it "retreating into an investment cocoon" on another website. Do your homework, follow some respected analyst's analysis (but make your own conclusions) and then control risk.
As was mentioned in a previous post, it really is all about money management - make your bed and lie in it and control the heck out of risk. A good trader can make money no matter what portfolio he is given because he will cut the crap out right away and let the correct decisions ride. Trite but true.
Steve Nison, aka Mr. Candlesticks, likes to push a trading triad - Eastern Technicals, Western Technicals and Money Management. Everyone knows how to buy but few really master the art of selling.
Tuesday, June 30, 2009
Monday, June 29, 2009
Still More Observations from the Advisor Conference
Just found this note I wrote to myself on the plane ride back from the Insite Advisor Conference in Ft' Lauderdale three weeks ago.
Michael Lewis, the Liar's Poker guy, spoke at the conference and his presentation was called "What Happened?" (more or less). He went through the events leading to the meltdown, CDOs, leverage, hubris and everything else as though he wrote it for one of his books. Bottom line - there were some really big Wall Street geniuses who were allowed to run amok. Scary, obvious in hindsight and proof that greed drives bubbles.
Another session had three advisor/trainer types talking about how to restore client trust. They made a lot of sense with strategies of simply talking to client saying "I am still here for you."
Then they starting in with asset allocation does not work and long-term investing is still the way to go. They scoffed at timing. (Their timing at realizing asset allocation bombed was pretty bad, wasn't it?)
Of course, I was seething but it was their show not mine. They can figure out how a 20-year time horizon in the stock market produced a return of zero. That's zero. A bagel. Goose egg. Squat.
T-bills outperformed, I think you get my drift. But then again, that is a secular bear market and asset allocators were out or greatly underweighted in long-term portfolios.
They went on to say that clients need advisors more than ever now and I totally agree. But not the guys that were blind to what was happening as they clung to old ways of doing business - ways that worked in secular bull markets.
But now that we are at the back end of a bear, at least a cyclical bear, buy and hold is going to work again. Just when these knuckleheads have capitulated to the idea that it is dead.
Michael Lewis, the Liar's Poker guy, spoke at the conference and his presentation was called "What Happened?" (more or less). He went through the events leading to the meltdown, CDOs, leverage, hubris and everything else as though he wrote it for one of his books. Bottom line - there were some really big Wall Street geniuses who were allowed to run amok. Scary, obvious in hindsight and proof that greed drives bubbles.
Another session had three advisor/trainer types talking about how to restore client trust. They made a lot of sense with strategies of simply talking to client saying "I am still here for you."
Then they starting in with asset allocation does not work and long-term investing is still the way to go. They scoffed at timing. (Their timing at realizing asset allocation bombed was pretty bad, wasn't it?)
Of course, I was seething but it was their show not mine. They can figure out how a 20-year time horizon in the stock market produced a return of zero. That's zero. A bagel. Goose egg. Squat.
T-bills outperformed, I think you get my drift. But then again, that is a secular bear market and asset allocators were out or greatly underweighted in long-term portfolios.
They went on to say that clients need advisors more than ever now and I totally agree. But not the guys that were blind to what was happening as they clung to old ways of doing business - ways that worked in secular bull markets.
But now that we are at the back end of a bear, at least a cyclical bear, buy and hold is going to work again. Just when these knuckleheads have capitulated to the idea that it is dead.
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