Posts filed under “Really, really bad calls”
We have said a good deal in this space about the futility of trying to time short-term market moves (see e.g., this, this and this). No one has demonstrated the ability to do this consistently over time. While it is possible to avoid the very largest of collapses over long periods of time using a simply trend-following approach (see Meb Faber’s “A Quantitative Approach to Tactical Asset Allocation“), the shorter the time horizon, the more difficult this becomes.
Thus, forecasting near-term market moves is an exercise in futility.
I bring this up because after a pullback of less than 10 percent in September and October, markets have powered ahead. Despite all of the crash warnings, the Standard & Poor’s 500 Index has managed an 11 percent gain this year. Yes, I know, a 1987-like crash, is imminent; I have been hearing that for five years. Like the boy who cried wolf, should a crash finally occur — and that is always a possibility — you won’t get credit for it.
In trading, early equals wrong.
Jim O’Shaugnessy took a closer look at what I am now dubbing the Tony Robbin’s Recent Weather portfolio. It is akin to taking an umbrella today because it rained yesterday. Jim is a quant extraordinaire, and his analysis confirms what I wrote earlier this morning: This is a biased sample, form fitted to have done…Read More
Tony Robbins is a self-help genius. He has sold millions of books that many people believe helped them realize their full potential. He understands the human psyche. As a motivational speaker, he knows what a person must do to overcome everyday struggles to “self-actualize,” and awaken the giant within. People love his seminars (although I…Read More
How much compensation the folks at Pacific Investment Management Co., better known as Pimco, haul in each year has always been a topic of fascination on Wall Street. In 2012, news reports suggested that the firm’s top 30 partners “pulled down an average $33 million a year in compensation in recent years.” A subsequent column…Read More
On this day in 1993, the Wall Street Journal published a survey of 10 market pundits. They had been asked when the bull market that started in 1982 would end. Most of the forecasters predicted a 10 percent market decline — hardly a bold position because 10 percent declines occur fairly often, about once a…Read More
While midterm coverage is largely focused on the parts of Congress that do very little, vital (and bizarre) midterm elections are going unexamined. State legislators pass a lot of bills, and some of that efficiency is thanks to a group called ALEC that writes legislation for them. It’s as shady as it sounds!
via John Oliver, HBO
Forget August. The real silly season is upon us. As evidence I present the forecast of a 13 percent increase in holiday sales made by Forrester Research, as cited in the New York Times this morning. Color me skeptical. As we noted about this time last year, these sales projections are as much of an…Read More
Alan Greenspan discusses current trends in the global economy and his solutions for addressing the financial crisis.
The C. Peter McColough Series on International Economics is presented by the Corporate Program and the Maurice R. Greenberg Center for Geoeconomic Studies.