Posts filed under “UnGuru”
When was the last time anyone got good investing advice from the front page of a newspaper or magazine or from a television pundit?
That is the question I have been pondering during this market cycle. Whether it is the price of equities or the state of the economy, I have grave reservations about relying on the usual suspects as a source of insight. This is especially the case when the usual suspects have been so wrong for so long about these issues.
Ask yourself the following questions:
• When has the mainstream media made a timely warning about an imminent recession?
• Has the punditocracy ever correctly identified a bubble in real time?
• When have the public’s perspectives on market valuation ever been right?
Give credit where credit is due: Faber admits his prior crash forecast(s) were wrong.
How wrong? Calculated Risk observes that the market is up 40% since his 2012 prediction.
Marc Faber: The asset bubble has begun to burst, here comes the bear market
via Jason Zweig: 1994: Remember Elaine Garzarelli, the “guru” at Shearson Lehman Brothers who “called” the Crash of 1987? Her Smith Barney Shearson Sector Analysis Fund, which sucked up $700 million in 1987 from investors dazzled by her forecasting ability, is shut down today as Smith Barney quietly merges Garzarelli’s fund into its Strategic Investor…Read More
I have spilled a great deal of pixels and time in these pages discussing the importance of not letting your biases get the best of you as an investor. (See this, this, this, this, this, this, this, this, and this). Further, when you are wrong, you must do more than merely acknowledge it: Embrace the…Read More
A reader writes in with this classic parable: The long list of reasons by pundits explaining the drop in Treasury yields reminded me of an old Wall Street joke: Over dinner following a hectic day in the market, the wife of this well-known pundit / stock-picker asks, “Darling, what’s wrong with the stock market?” His…Read More
“It’s tough to make predictions, especially about the future.” -Yogi Berra, or Neil Bohr Last week, I was in San Francisco speaking to 700 financial planners from northern California. The areas that seemed to generate the most feedback and questions were on expert commentary and on risk. People love forecasts. They shouldn’t…Read More
As per our earlier discussion, here is Carl Sagan. He argues having a finely honed bullshit detector isn’t merely a tool of science — rather, it contains invaluable tools of healthy skepticism that apply just as elegantly, and just as necessarily, to everyday life. By adopting the kit, we can all shield ourselves against clueless…Read More
Over the past few decades, I have watched the financial industry change. Some parts have evolved quite slowly, while others shift rapidly. But I am always amazed at how some business models manage to hang on despite overwhelming proof of their lack of purpose or value added. Some parts of the investment world exist simply…Read More
This week was the 19th annual Ira Sohn conference. It is an opportunity to raise money for a good cause (pediatric cancer research and treatment), and hobnob with rock star hedge-fund managers. It has become a must-attend event. Just remember one important thing: Ignore the stock tips. It is true that the picks and pans…Read More