April 29, 2018 Excerpted from a letter sent to clients on April 27, 2018: In our last quarterly update, we focused on the extreme stock market optimism that prevailed at that time in late January. At that point, the market was up almost 7% for the year and, as we discussed, investors were by …
What to do when everyone’s optimistic (plus: Bitcoin vs. the Tech Stock Bubble)
January 31, 2018 Excerpted from a letter sent to clients on January 30, 2018: The world economy has continued to strengthen. Growth in both emerging and advanced countries has been on the rise, with the latter showing a particularly rapid comeback: Source: Markit Economics, Capital …
How to Think About Market Risk
November 2, 2017 Renewed optimism about economies and markets has led to an unusual calm. Global stock markets have gone up in practically a straight line since the post-Brexit vote correction ended in mid-2016, and here in the US, markets are by many measures the calmest they've been in …
Valuation Thin Air
August 8, 2017 We discussed why we're leery of US stocks in the last article: they just aren't priced for very good long-term returns, especially when compared to much less expensive markets outside the US. Here's another way of looking at it, from AMP Capital: Source: Global Financial …
Thoughts on the San Diego Housing Market
June 19, 2017 The median price of a San Diego home recently surpassed its all-time peak, as noted by the San Diego Union-Tribune (with a cameo appearance from Rich). We thought this made for a good opportunity to share some thoughts on the local housing market, addressing common …
Prospects look far better for international than US stocks (but US investors are loaded to the gills with the latter)
May 13, 2017 With so much news and commentary these days focused on politics, some people might not realize that there's been a noticeable strengthening of the global economy. Below are a couple of charts to support this point. The first shows global manufacturing Purchasing Managers' …
A Good Year for Global Value Investors
January 26, 2017 We wanted to quickly highlight some cool research from StarCapital, a German investment firm, showing how well global value investing worked in 2016. What the folks at StarCapital did was to sort 40 countries by their beginning-of-2016 stock market valuation, and then to …
The futility of “headline investing”
January 18, 2017 Excerpted from a letter sent to clients on January 18, 2017 We've often argued that trying to invest based on economic and political current events what we call "headline investing" — is unlikely to work well. (The reasons are many; a good refresher can be …
Will Value Investing Rise Again?
September 19, 2016 Does value investing still work? It's a reasonable question, given the tough stretch that value-based asset allocators have faced over the past several years (at least up until this year, which has so far been quite a good one for Team Value). GMO's Ben Inker examined …
Presidential Elections and the Stock Market
July 29, 2016 Excerpted from a letter sent to clients on July 12, 2016. Our view on "headline" news events is that while they can certainly have an impact on markets, that impact is impossible to reliably predict, and is often short-lived in any case. Presidential elections seem to fit right …