April 2013: Should we be Investing at Record Highs?
Recently US stock market indices have reached record highs. The last two times a record was set was in October 2007 and March 2000 and significant downturns followed the “financial crisis” and the “dot com bubble”. We have heard from a handful of clients who are concerned about investing during/at the market “top”. The question is usually along the lines: “Should we really be investing in stocks now that we’re at a record high”? In cases where we are putting new money to work the concern is: “Aren’t we buying high”? The chart below is also the Dow for the same period of time but it...
Read MoreMarket Summary – Q1 2013
The year got off to a great start for equity investors with the US Stock Market at all time highs at quarter end. What’s not to like? The three legged stool of investor well being is on firm ground once again: housing appears to be recovering faster than expected; unemployment has continued to fall, and, as the US Stock market hits new all time highs, it finally feels safe for millions of workers to open their 401k statements again. As always, opinions differ. Ask a bull and he’ll tell you the market is cheap, citing rising corporate profits, below average price earnings ratios and...
Read MoreMarch 2013: Of Foxes and Hedgehogs
Predictions are tough, especially when they involve the future. Yogi Berra Philip Tetlock, professor of psychology at the University of Pennsylvania, is a rock star to statistics geeks but less well known by the general public. Newly tenured at UC Berkeley in 1984, Tetlock began a twenty-year study in which 284 experts in many fields – government officials, professors, journalists, and others, and with many opinions, from Marxists to free-marketeers, were asked to make 28,000 predictions[1][2] about the future. His major finding: they were only slightly more accurate than chance. ...
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