January 28, 2021: Stock markets have been surging higher, and our favored areas (international and emerging value stocks) really outperformed last quarter. But looking at the whole of 2020, the real craziness took place in growth stocks. In fact, we believe that US growth stocks have become a …
The investment impact of the election
October 29, 2020 We’ve been getting a lot of questions about the election and its potential impact on the stock market, so we wanted to write some thoughts on the topic. To begin with, we should mention that we have very low exposure to US stocks. This has nothing to do with the election, and …
From fear to greed in four months
July 24, 2020 The world continues to grapple with the Covid-19 pandemic, but you wouldn’t know it by looking at financial markets. The recent cheerful market mood is a huge turnaround from the complete panic and despair that reigned just four months ago.During the panic, we were adding to our stock …
Feelings vs. reason: what’s in control?
May 25, 2020 Excerpted from a letter to clients sent on May 14, 2020. Anyone can sign up for our quarterly updates here. “When it comes time to buy, you won’t want to.” Doug Kass In mid-March, it was pretty clear to all that COVID-19 was going to be a disaster for many people …
Stock prices, values, and return forecasts (better than 2009, in some cases)
April 3, 2020 In our last letter, we explained why we think the pandemic seems unlikely to significantly alter the stock market’s fair value. To very briefly recap: Stocks represent ownership of a long-term stream of future earnings. The “fair value” of the stock market is the …
A bad economy doesn’t make stocks a bad investment (plus: government/Fed stimulus update)
March 26, 2020 Excerpted from a letter to clients sent on March 26, 2020. Anyone can sign up for our quarterly updates here. We hope you are staying healthy and safe. We have thoughts to share on several topics, but in the interest of not overwhelming you, we’ll break it up into a few …
Market update: our outlook, what we’re doing, and reflections on past panics
March 13, 2020 Excerpted from a letter to clients written the evening of March 12, 2020. Anyone can sign up for our quarterly updates here. We'd first like to express our concern for the health of our clients, families, and friends. The situation has escalated and we know that this is …
All time highs are nothing to fear (plus virus scares, and the importance of knowing where you stand)
February 5, 2020 After a year of sizable gains, the global stock market has dropped about 3.5% since news of the virus outbreak in China came to light.(1) We'll discuss the virus scare momentarily, but first we want to share some thoughts on another worry we had recently been hearing a …
The best opportunity for value investors in 20 years
October 25, 2019 Over the past decade, stock markets have drifted far from their typical behavior in several ways. There is a big opportunity at hand if markets should end up moving back towards normal as they generally have in the past. This idea is known as “mean reversion” in …
San Diego housing: measuring valuations, the role of rates, and whether to buy now
August 6, 2019 Excerpted from a letter to clients sent August 1, 2019. Anyone can sign up for our quarterly updates here. Measuring housing expensiveness We all know that buying a home in San Diego costs a lot more than in most cities. But that's always been the case, and …